Programmatic is here to stay and now that advertisers like Procter & Gamble are throwing their weight – and hefty slices of their budgets – behind automated buying, others are sure to follow.
Raymond Reid, President of Acuity’s recently formed AdScience division, says certain categories like automotive and financial were early adopters of programmatic , whereas traditionally less targeted categories like consumer packaged goods lagged behind, but he expects momentum to build quickly now that leaders such as P&G are making bold moves in that direction.
“We have to keep in mind that advertisers have gone from four or five primary media choices to a universe of infinite choices through digital,” Reid explains. “Their attitudes have changed primarily in terms of having better understanding of how to use digital but they are still grappling with all the data and the different platforms – and which platforms will deliver the best ROI. The CPG companies long ago figured out the methodology of reaching consumers at scale through TV, which for their products is all about sight, sound and emotion. Digital was a little slow in being able to deliver that, despite the efficiencies that can be gained.”
In June, announcements from major international brands added steam to the programmatic momentum. P&G plans to buy from 70% to 75% of its US digital media programmatically by the end of this year. Mondelez International, parent of Cadbury, Nabisco and Tassimo brands, signed a global deal to handle all of its online video buys via TubeMogul’s programmatic platform. Buying, done on a GRP-basis, will be controlled out of a separate unit set up by MediaVest, Mondelez’ North American media AOR.
Brock Bradley, VP of Business Development for TC Media’s Canadian Programmatic Marketplace, says it’s all driven by where the money goes. “With big brand dollars moving to programmatic, there’s going to be a frenzy of followers all wanting to take the leap. Now that advertisers are really seeing the benefits of programmatic spending, the efficiency that it brings, we’re seeing the successes now being part of the conversation – and leading it.”
Bradley hopes that it will also provide the impetus for more publishers to get creative with the ad inventory they offer. “There’s definitely room to think outside the box. Buyers want anything that is non-standard, anything different. It’s something they can take to their brands to say ‘look at this cool thing I’m doing for you – and I’m buying it programmatically’. It creates a better story for the agency and the brand to embrace.”
Advertisers that were early adopters of programmatic were initially drawn to its targeting abilities and the transparency of both price and ad delivery. Now that platforms are adding many more targeting variables as well as brand safety, viewability and fraud-prevention tools, the barriers to programmatic have been eliminated for many marketers.
Grant Le Riche, Managing Director of TubeMogul Canada, says by providing advanced tools, programmatic platforms enable advertisers to target their audiences with greater accuracy and with contextually relevant ads, which is becoming increasingly important as TV audiences continue to fragment and brands need to adapt their strategies to find those audiences across other media platforms.
Le Riche says that in terms of targeting there are a variety of ways to use data-driven insights to improve campaign delivery, but cautions that it’s important to note that the more targeting parameters planners add in, the more difficult it can be to deliver that campaign. “As you layer on targeting parameters, you decrease the amount of inventory your campaign can deliver, so it can be a real art to get the balance right.”
The new tools and metrics such as conversion, brand lift and viewability are not only helping advertisers understand the performance of campaigns, they are also helping to strengthen the point that clickthrough rates are not a measure of success. Katie Wolf, Acuity director of product and partnerships, says that programmatic will also show advertisers that they need to break down budget silos and stop allocating spend based on display, video or social. “People are increasingly using different screens to watch TV programs so it’s time for advertisers to take a closer look at their dollars from a more customer-centric point of view rather than just a media-centric point of view.”
As for what’s next for programmatic, its expansion to other media has already begun. A number of tech companies are working on programmatic TV buying platforms, including Turn, a California-based demand-side platform, which launched its offering in May. Earlier this year, AOL’s Adap.tv service introduced programmatic TV ad buying and the platform reaches 90 million US TV households.
As per Reid, with programmatic moving not only further into digital but beyond digital to all platforms and advertising, “it’s going to have a substantial impact on how advertisers engage consumers going forward – whether for direct response or for brand advertising across multiple platforms.”