“What do we mean when we say, programmatic?” asked Michael Morrow, marketing director for advertising intelligence, Kantar Media SRDS, in a Connectiv webinar last week titled Media Boot Camp on Programmatic Buying Part 1. “Historically, people have said open auctions, real-time bidding. It’s important to know that the programmatic eco-system is much broader than all that. At its essence, programmatic is an umbrella term for automated and data-driven ways that you can offer your inventory to buyers.
“It’s crucial to remember that programmatic is no longer just a buzzword and it’s no longer just a buzzword for consumer media.”
Morrow and Steven Davis, president of Kantar Media SRDS, delivered 50 information-packed minutes to the Connectiv audience, emphasizing that if you’re not at least asking the right questions of your marketers and customers on programmatic, then you’re falling way behind.
(A video and recording of the presentation is available here. A part 2 will be held Sept. 20 at 2 pm. You can register here.)
Morrow described the three “big buckets of programmatic” used in the industry.
1. The Open Ad Exchange/Real Time Bidding/Open Auctions is basically offering your inventory into a real-time bidding environment. “It’s where programmatic began,” said Morrow. “It’s the simplest way for publishers like us to monetize the inventory that’s going unsold. We might as well put it up for sale.”
The SRDS database has a collection of ad networks and ad tech vendors, Davis added. This part is an automation of those ad networks… You’re not seeing your high-quality advertisers taking advantage of that space.”
“Over time, this has evolved as well,” said Morrow. “Publishers have tried to improve their yield.” But even with something like header bidding, there are positives and negatives in this form.
2. Private exchanges are used by publishers to more carefully control who can buy their inventory and at what price. Instead of throwing ad impressions into an open exchange and letting anyone have access to them, you can open an auction environment to a handful of your favorite advertiser clients or to an agency that you have a close relationship with. You might want to set up a private marketplace to exclude or cut off access to other networks that might be reselling your ad impressions on the open market.
There’s also something called an unreserved fixed rate where publishers can negotiate a deal with advertisers for non-guaranteed inventory. The buyers can still access your inventory programmatically but you get more control of your price and what’s available.
“It still gives the marketer the right to buy at the impression level,” said Davis, and to target that level based on the audience criteria, or whatever specific criteria they have to serve that ad against that target audience.
3. Automated guaranteed, programatic guaranteed is the closest you get to a direct sale with your client. It’s a one-on-one transaction where you have guaranteed inventory on your site, you’re making it available for a fixed price. “What makes it programmatic is the injection of technology into automating the RFP—autiomating the campaign tracking and the actual execution of the buy,” said Morrow. “It gives buyers control and reassurance of the safety of where their buy is going and it gives you maximum control over who’s buying what and at what cost—a fixed model with one seller and one buyer. These are resulting in the highest CPMs for you and the strongest assurances to the buyers. They want that quality.
Davis (pictured) pointed out the three biggest insights from the study that Connectiv and Kantar undertook together. B2B advertisers are already spending significant sums programmatically. Spending is shifting from conventional digital budgets. And B2B marketers, through these programmatic asks, on audience and inventory quality which includes not just ad positioning but also in the right context against content that is relevant.
“Clients have specifically requested that their display advertising be bought programmatically,” Davis said. Almost 47% said that these dollars are coming from a shift in budget from non-programmatic means—25% shifting from the print budget. Most everyone is now familiar with programmatic, and 55% are extremely or very familiar with buying programmatically.
He added that B2B isn’t that far behind consumer now. “It’s further advanced than we were giving buyers credit for,” Davis said. The majority of B2B still use open ad exchanges with 60% using private marketplace and automated guaranteed channels. Almost 90% want to buy audience targeting. “But if you can layer that with context, or particular content, that would be ideal.”
Just over ¾ of the buyers surveyed buyers are using audience and/or site/content targeting. “As content producers that’s still your game to win,” Davis said. “They recognize it’s an important criteria.” Getting the right audience with the right editorial is still crucial. In the next session, Davis will be telling how to operationalize all this.
Lastly, Davis was asked, What do you suggest publishers look at for their own programmatic opportunities? “It’s wrong to suggest that it’s always a numbers game,” he said. “You have to start with what are the marketers asking for? We’ve had a fair amount of conversations with B2B publishers. ‘I’m sold out, inventory is sold out; the yield is good. The revenue through direct buys is still good, why bother?’
“In your market is there more of a demand from your key agencies or key marketers to buy this way? My guess is that those questions are being asked. To simply say we’re not enabled is a risk. The way to operationalize is there. The key question in this study is not how much can I make but how much can I lose if I don’t make the investment. If you’re not able to provide marketers with the inventory they need, they might be able to buy it through other channels. You have to talk to clients.”
Most of your traditional competitors are not programmatic enabled, Davis said. “Very few are leading the charge in programmatic. Those who are leading the charge on consumer sites—Bloomberg, Business Insider—those are the publishers that more and more are becoming your competitor. Are you tracking their advertising gains? My guess is most of us are keeping an eye on traditional competitors and not those who are further afield.”