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SpotXchange Launches the First Auto-Optimization Solution for Video Advertising


February 22, 2011 - DENVER, CO

SpotXchange, the largest global marketplace of video ad inventory, announced today the launch of Otto™, the company's machine learning auto-optimization technology for video advertising. Building on SpotXchange's advanced audience targeting capabilities, it is the first video ad network to automatically optimize campaigns to achieve the best performance possible at scale. It is able to improve campaign results immediately, without the delays and limitations of human evaluation, and continues to get smarter over time.

For advertisers, early testing showed campaigns deploying Otto experienced a steady rise in click-through rates (CTR) -- jumping from 0.75 percent to 1.48 percent in just five days, well above industry average. For publishers, Otto finds the best-performing publisher placements and audiences for each video ad campaign, and rewards those publishers with higher CPMs.

The development of Otto was led by Mike Griffiths, an online advertising pioneer in behavioral targeting, privacy and optimization and SpotXchange's vice president of data analytics. "Auto-optimization technology is nothing new in the offline and online world. What SpotXchange has done before anyone else is to make this auto-optimization technology scale, operate in real-time and actually work in an online video context."

Otto finds the best placements for a video ad by continually monitoring and evaluating various performance and audience data inputs. It processes millions of data points related to video ad creative and placement information -- such as site, context, demographic and historical performance -- to find the best solution for every campaign. To do this, it deploys multiple layers of ad campaign performance data within the SpotXchange system to increase the frequency of impressions that get the best results while automatically eliminating placements that are not achieving specific performance metrics.

In addition to ensuring better campaign performance instantaneously, Otto reduces costs for advertisers by proactively determining each impression's relative value based on how it will perform against the specific campaign's goals. This ability to select the right ad for the right opportunity helps an advertiser get the most value out of their ad spend while rewarding publishers for better performance.

"Otto is the first fully automated optimization solution to be offered in the video advertising space, which is important given the number of advertisers who are now targeting by audience across thousands of sites," said Michael Shehan, founder and CEO of SpotXchange. "We understand that not all impressions are created equal, and it's not possible for a human to evaluate millions of potential video ad placements in order to determine the optimal value for each impression opportunity. Otto optimizes a campaign in real-time at the impression level in order to fully maximize performance and campaign spend."

SpotXchange's first implementation of Otto has been focused on performance-based video ad campaigns in the marketplace, such as automatically optimizing cost-per-click (CPC) campaigns. The company will soon deploy the technology against cost-per-completed view (CPCV) and cost-per-engagement (CPE) campaigns.

Furthermore, the offering also develops detailed analytics about a campaign's audience, giving advertisers unique insights and a better understanding of campaign performance across a number of metrics. Rather than simply relying on generic demographics, Otto helps challenge and validate assumptions that might exist going into a campaign, giving marketers a better understanding of their audiences and who responds positively to their campaign. This continuously monitored data will help steer current and future campaigns in the right direction.

About SpotXchange
SpotXchange is the largest global marketplace of video ad inventory, reaching more than 80 million unique visitors each month in more than 15 countries. SpotXchange offers brand advertisers a scalable, efficient and measurable way to attract new customers with high-quality online video ads on premium websites around the world. Focused on performance, SpotXchange is a one-stop shop for advertisers, ad networks, DSPs, trading desks and publishers, offering a simple, automated way to increase the effectiveness of their video ad campaigns. Each month, more than 200 major brand advertisers take advantage of SpotXchange's offering of automated video ad optimization, advanced targeting tools, real-time bidding and flexible pricing models (cost per: thousand, click, completed view, engagement and acquisition) in a verified, brand-safe marketplace. Currently, SpotXchange is the #3 online video ad network in the United States, and #1 in the UK and Canada according to comScore's VideoMetrix service.

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