Programmatic advertising may have dramatically changed the way creative is delivered on websites, but have tech suppliers really reached the summit with its development?
A version of this question was posed by Amit Kotecha, Quantcast’s head of marketing for EMEA, who ran the rule over the industry’s favourite new buzzword as part of a digital innovation panel at Performance Marketing Insights: London.
In a combined effort with two other major ad players in DigitasLBi’s media innovations director Andrew Girdwood and Adobe’s ex-director of new product innovation for EMEA, Jonathan Beeston, the group summarised that ad trading desks have a long way to go before they tick all the programmatic boxes.
“Programmatic by nature is designed to be something of a commodity. It moves away from the network model by opening up the platform to as many people as possible. But at the same time, I don’t think it’s complete,” chimed Girdwood, who cited an inability to reach the right people at the right time for his reasoning.
The idea of buying and selling ads programmatically has gained a huge amount of traction in recent years, spearheaded by tech providers including Criteo and Rocket Fuel as well as publishers such as AOL putting an immense amount of their inventory up for programmatic sale.
By 2017, Magna Global estimates that programmatic will grow to a $32.5 billion industry but one with plenty of room for improvement, according to Girdwood.
“I think we’re really good at showing the right ads to the right people now. I don’t think we’ve finished the journey in terms of showing the right message to the right person and at the right time.
“So, if I fly from Edinburgh to London for business, you should be prompting me – with the right offer – just before I make my trip. If you show me that banner after I’ve come back from London, you are wasting your money. That’s the part of the puzzle that’s still missing.”
Issues at hand
Veering away from the timing of ads, Beeston lauded programmatic buying for the way it has tackled some of the known issues with buying and selling ad space within the online arena. The ‘back-end’ of ad selling, as such, has undergone a sea of change in recent years as publishers and advertisers piggybacked on the programmatic craze.
Marissa Meyer, president and CEO of Yahoo!, famously stated ‘the opposite of programmatic is manual’, and Beeston claimed the automated nature of distributing creative has only been of benefit to the wider ad industry.
“Trying to build those efficiencies into the buying and selling of advertising is a good thing, and I actually think there’s a long way to go there, because there are plenty of inefficiencies that need to be rooted out – in terms of the way advertising is traded.
However, Beeston believes there is a deeper problem – of monetary worth to its websites – that programmatic is yet to address.
“Efficiencies only get you so far in terms of making the business better; you can only cut costs down so far. Whereas what you should be doing is growing revenue.
“I think what programmatic still hasn’t done is substantially grown revenue for publishers. And we still see publishers slashing away, trying to find a business model to make advertising work for them.”