The SIX things you NEED to know about programmatic today

Some very quick thoughts on what we think are the six things anyone working with programmatic today needs to know.

1 – Campaign optimisation isn’t only ad ops

  • Campaign optimisation is one of the biggest levers for effective delivery of media and therefore one of the biggest levers for business performance
  • A DSP is easy to use, as is Microsoft word, gmail and other commonly adopted pieces of software, but to think that makes campaign optimisation easy misses the point entirely
  • Automation won’t replace the role of true campaign optimization, it will sit beside it
  • Advertisers need to better assess those who run their programmatic campaigns

2 – The drive towards single buying platforms will continue

  • Buyers don’t want multiple platforms to trade their media across – we’ve written on the setbacks of this approach before
  • This means that specialist platforms either get made redundant or get absorbed into bigger platforms (so long as they can find a way to integrate)
  • The % of ad spend going through managed service IO businesses will only continue to decrease, putting pressure on bottom line business performance for these companies
    • Caveat is that some will weather the storm through differentiation and delivering performance (as some advertisers will rely on their capabilities) but growth will likely be slow

3 – Rebates from ad exchanges is the worst financial practice in media

  • In the supply chain you have; advertiser, advertiser tech, sell side tech and publisher
  • Big buyers are looking to strike deals with all the major parts with which their money flows through – this includes ad exchanges (sell side technology)
  • Big buyers are trying to prioritise PMPs through these exchanges so that they can get a greater share of this new revenue stream
  • This practice is very difficult to audit (and complex due to the buying mechanisms in place) unless a brand has a direct relationship with the SSP which very few do today
  • It’s made even more complex when the buy side tech (such as a DSP) also has a deal in place with an ad exchange!
  • This practice is really poor, it flies in the face of the transparent world the industry is moving towards and exchanges should be setup to pass-through costs and act as a facilitator, not as a non-transparent middleman

4 – Header bidding isn’t adopted in the way you might think

  • The unified auction where all demand competes equally to drive up publisher yield and deliver better performance for advertisers (by being able to reach audiences they wouldn’t normally access) isn’t in place the way you might think
  • So few publishers have implemented this as their only monetization strategy
  • There’s still huge opportunities for advertisers/agencies to work directly with publishers on audience guaranteed, direct or PMP basis which sits above the header bidding mechanics

5 – Brands will (and should) continue to directly own ad tech relationships

  • Brands are increasingly using data and technology within their business to make product, supply chain, logistics, personalisation and many more business critical decisions
  • It’s only natural that insight derived through media buying gets closer to a brand
  • To do this they need to own the technology contracts themselves as the technologies become so important – on the flip side if they outsource the contracts and then decide to change the third party owner of the technology they may lose the associated data

6 – All media will be bought programmatically

  • No-one is quite sure the guise or how quickly some of the traditional channels become programmatic, but all channels will be available programmatically
  • The notion of ‘if it ain’t broke don’t fix it’ simply doesn’t stand in a fast moving industry. It’s more “you fix your roof whilst it’s sunny”
  • The major barriers are technology (quickly this is being overcome), commercials (some legacy practices which need to change) and talent (some decision makers who don’t understand or don’t care enough about it)

I’m sure you’ll have different thoughts (creative, data sharing and impact of GDPR all came close) but hopefully this list has been of use.

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