Solbright: Over Time, Display Market Still Hurting

Average CPMs for premium display advertising have rebounded in 2010 after a difficult 2009. But prices are still far below where they were four years ago, according to new report issued by Solbright, a company which provide forecasting and inventory management tools for more than 3,000 Web publishers.

According to the Solbright Digital Media Index, the company’s new macro price-tracking service for online advertising, CPMs climbed 9 percent during the first six months of this year compared to the same period in 2009. Second quarter was particularly strong, as CPMs jumped 17 percent over last year.

However over time, CPMs have consistently declined as the Web has become saturated with inventory, according to Solbright. Data presented to Mediaweek showed that while CPMs have spiked with regularity during each fourth quarter over the past four years, overall display CPMs have slipped from a $16 average in 2006 versus a $10 average this year.

According to Solbright president and CEO Thomas Pace, the company’s index data is more representative of top-level premium inventory than similar indexes published by companies such as Pubmatic, which he believes represent the Web’s longtail. Solbright works with many top Web publishers from media companies such as Yahoo, Discovery, Turner, MTV Networks and the Washington Post.

While Solbright does not plan on revealing any CPM data for specific clients, the company’s hope is that the new Digital Media Index will become a relied-upon resource to gauge pricing trends in the industry. It plans to release the report on a quarterly basis. Among the current index’s findings are that health care and education sites are commanding the highest average prices. Also, sites within the entertainment, travel and sports markets have enjoyed revenue spikes in 2010.