Programmatic: The state of it

With 2015 coming to a close, one key buzzword in the digital space has been “programmatic buying”. I would like to take this opportunity to give my thoughts.

A recent Ad Exchanger survey showed that there has been some evolution from one of two players to more adopters across various industries.

The main industries seen investing in programmatic have been Retail, Financial services, Media and CPG.

Based on the survey, there have been both a cautious and bullish opinion on marketers adopting programmatic. This is expected to change as we see the overall market maturing with expanded pool and type of inventory. This would eventually lead to a more increase in investments on programmatic.

There three main areas of programmatic that will see an increase. These are.

Desktop display, which still dominates and is the most mature of the programmatic channel.

Programmatic video remains popular, however the challenge remains in getting premium inventory. YouTube still remains the most popular destination for most marketers.

Programmatic mobile, which is growing & expected to grow with industry maturity and ad unit prices remaining low.

All said and keeping a high hope for the year ahead, the main challenge still remains with the key issue of “ transparency”

This is not a surprise considering agency-trading desks and kickback concerns. Added to this the complexity of having layers and layers in the value chain.

As a result we are seeing many agencies having direct involvement by investing in technology or engaging in more oversight into agency and partner management.

Agencies continue to point fingers at “ inventory quality” as the biggest problem. This obviously leads to a lot of trust issue between the agency and the clients on roles, responsibilities and expectations.

The key benefit still remains the low CPM, which is very visible in the CPG industry who view programmatic as a mechanism to drive cost saving and reduce non-working media dollars. This is complete contrast to ROI driven clients who go to the extent of matching impression purchase price to the expected ROI.

Another interesting trend developing off late is the use of multiple DSPs- Turn, Double click Bid Manager, MediaMath etc.- to execute full scope of the programmatic media efforts. This does provide its own challenges in terms of data overlap, poor frequency management- this trend is likely to increase as marketers try to maximise reach and use channel specific DSPs.

The Next big wave?

The next big thing to look out for is programmatic TV, though in infancy the excitement among the buyers are increasing- granular targeting, flexibility and measurement in the television media space.

On thing is for sure, programmatic will be an interesting space to watch out for. Programmatic media has moved from “ tip of the iceberg” to mainstream.

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1 Comment

  1. Well written and absolutely agree that programmatic TV is the next big thing to watch out for. In fact making TV buying programmatic would save a lot of the marketing spends that are wasted via the inefficient traditional models.

    I write a lot on digital media blogs, do have a look https://themarketingscientist.wordpress.com/

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