Why is programmatic still daunting to so many?

MediaMath VP partnerships and country manager ANZ Yun Yip
By MediaMath VP partnerships and country manager ANZ Yun Yip | 13 November 2019

The programmatic ad buying space has experienced exponential growth over the last few years, alongside many a complex twist and turn.

It’s now deeply embedded into media plans and tech players are continuing to find new and increasingly efficient ways of creating and offering different innovations in this space.

Whether that’s implementing custom algorithms to drive better buying decisions, permitting greater personalisation or creating solutions in emerging channels such as connected TV, the programmatic tendrils are everywhere.

If one needs convincing that the programmatic age is well and truly here, a recent Programmatic Ad Spending Forecast from eMarketer revealed that in the US alone, advertisers will spend nearly US$60 billion on programmatic display this year. By 2021, it estimates almost 88%, or US$81 billion, of all US digital display ad dollars will transact programmatically.

According to Zenith’s Programmatic Marketing Forecasts, in 2020 advertisers will spend US$98bn on programmatic advertising, representing 68% of their expenditure on digital media advertising. In Australia, it predicts that by 2020, programmatic spend will rise to $2.92bn, a 67% jump over figures from 2018.

However, despite these huge and healthy figures, marketers’ eyes often still glaze over at the uttering of the word programmatic.

But why the hangover with programmatic? Why can such a good thing leave such a bad feeling? What have we got wrong that still, in 2019 - despite the proof in the pudding on the success of programmatic - do we still stumble upon these moments of disconnect with clients?

It could be that we have done a collectively bad job at explaining it, and have been too focused on the ‘how’ and and not enough on the ‘why’ (the outcome).

Or perhaps in those rudimentary earlier days when programmatic was associated more with transparency concerns and later the murky supply chains, people simply switched off from wanting to understand more due to the negative associations?

Either way, most of the issues can be boiled down to a general wariness due to fear of the unknown. Let’s look at what we can do as an industry to help brands move past this.

Programmatic reserved for a special few

Looking back to the early days, rhetoric around programmatic was reserved for those in trading and specialist programmatic teams, but today not only are chief marketing officers in the weeds of it, but conversations have seeped through to chief investment officers and increasingly the CEO. Which effectively cements its role in the media and marketing world.

Previously programmatic was also thought to be about remnant inventory and the desire to “get cheap inventory online”. Today, however, it's about how automation can deliver improved team efficiency and stronger return on investment into the business.

Yet while the association with remnant inventory may have dissipated and the transparency issues don’t rear up as much, programmatic is still confusing to many clients thanks to its correlation with other, at times confusing, elements.

While it’s becoming rarer for clients to ask ‘what programmatic means’, questions around whether they need a DMP, why they would want a DSP or whether it is better to in-house are increasingly prevalent.

It’s one of the reasons in our office when speaking with clients, that we sometimes swap out the word ‘programmatic’ for ‘automation’, as this makes it a very different and far easier conversation from the get-go.

How to get over the hump?

The upshot is programmatic is not standing still. It’s here to stay as the innovation and the benefits that come with it are too big to not be taken seriously.

Media efficiency, business efficiency, as well as in many cases, sales and acquisition, are all hard to argue with.

Data driven automated buying, selling and optimisation of digital advertising is only going to speed up and not just in display and TV, as digital out of home, radio and podcast channels all delve deeper into automation.

While education and reluctance to learn due to fear may be identified as reasons for still finding programmatic daunting, that doesn’t solve the answer as to whose job it is to help address the issue.

Should it be media agencies or ad tech vendors? Or is leading the horse to water not the answer? Shouldn’t the onus be on clients to skill up, break new ground and push partners to do more in programmatic?

It’s likely no one will agree on whose role it is, with most, like myself, agreeing that we all have a role to play. However, the danger with this is that if no one owns it, that lack of responsibility means a lack of focus on solving the problem.

While we offer clients training and are on hand with any questions, it takes a collective effort to make programmatic and all its nuts and bolts seem warm and friendly.

It’s also important to stop and remember that while some of these terms and functions seem basic to you, that actually you, like myself, are in a minority in the knowledge stakes in the wider scheme of it all.

Forging ahead

For those still considering programmatic I can suggest that if automation is appealing or if you are seeking a multichannel pipeline then you should be forging ahead now.

But don’t just take the marketing spiel of various ad tech partners or even agencies at face value – conduct your own research and keep asking questions of them as you continue to engage.

Read and share with your team resources such as the ‘WTF’ guides and glossaries IAB Australia creates so you are clued up with the ad tech jargon; attend events and meetups (such as the quarterly Sydney Ad Tech Meetup) and work hard to get familiar with the language, trends and challenges in the space.

Finally, and perhaps most importantly, keep trialling and testing new ways of working with the technology until you get the results you want.

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