Adform’s chief strategy officer Anthony Rhind explains what must be done to ensure programmatic is no longer seen simply as a means of accessing low priced inventory.
What have been the most significant developments in ad tech and programmatic trading over the past year?
“That’s a big question! The broad trend is that more and more display activity is being traded programmatically. The recent IAB figures suggest 60% of UK display is now programmatic. So generally, automation has already replaced a significant volume of IO trading for display, which compliments the pervasive automation of search, YouTube and Facebook buying.
“In the last year an increasing volume of rich media, video and other premium inventory is being traded programmatically albeit mostly via private marketplaces rather than open exchanges. This is a positive trend as it will attract the brand advertisers to more broadly adopt automation – a shift that is essential to ensure programmatic is no longer seen as a means of accessing low priced inventory and more as an improved means of managing all digital media buying.
“The adoption of the brand advertisers cannot happen without suitable, high-impact ad formats. This is an area we have been very active; Adform is not alone in offering high-impact formats that can be traded programmatically, but we do offer a free creative development toolkit and our certification team are a powerful support to advertisers and publishers seeking to create outstanding ads that can be traded at scale.
“In addition to evolving to better quality inventory, the KPIs associated with reporting & optimisation need to become more sophisticated. This is an area I don’t feel has moved as much as it could have done – viewability as a trading metric has been much discussed, but regardless of buying metrics, viewable CPM should be a core metric when managing campaigns. Moving further, the reporting and optimising brand awareness uplift and affinity KPIs is also essential for programmatic to climb beyond the ‘bottom of the media plan’.
“I believe this will establish a more discerning trading community, which will more actively distinguish between DSPs feature strengths and weaknesses”
“Decisions I would highlight in the last year as very significant include the restriction by Google to only allow DBM to access YouTube programmatically. Also, the decision of Facebook to shutter FBX and its announcement that it won’t develop a Facebook/Atlas DSP.
“Google’s decision means the majority of advertisers need to have DBM as an option, heralding the end of solus DSP strategies – unless it’s Google’s! The silver lining to this decision to erect a walled garden is that it means every team of trading specialists must build deeper DSP expertise. I believe this will establish a more discerning trading community, which will more actively distinguish between DSPs feature strengths and weaknesses.
“I feel this will help Adform as I do believe we offer many features superior to those of other DSPs. Regarding Facebook, I don’t believe it made rash decisions, so I assume both announcements link to a bigger ad tech strategy. I hope it indicates a decision to enable third party ad tech to operate with Facebook inventory and data. As Adform is a pure technology company, with no media or data assets, I hope Facebook will see us as an ideal partner to enable their advertisers to do this – we are available to Palo Alto to discuss this anytime!”
How are advertisers and publishers evolving their internal operations to embrace ad tech, and how can they improve?
“Digital advertising and digital publishing have always relied on technology but the programmatic evolution is highlighting the friction created by the variety of providers, as so many have not been developed to interoperate with other technology.
“Consumer behaviour and evolving digital marketing strategy is also exposing systemic weaknesses with many of the technology providers, for example, the support of mobile OS devices and how they (often fail to) enable high-impact formats. ‘Mobile best’ and ‘interoperability’ need to be mantras for both the advertiser and the publisher solutions, then corporate strategy, rather than technology, can define which partners and functionality to advertisers and publishers choose to enable.
“We all need to act now to convince the legislators to develop the draft EU Data Protection Regulation so as not to kill data-driven marketing”
“In addition to the technology friction areas, the data needs to be enabled to improve digital in terms of both advertising and site/application user-experience. DMPs have been highlighted as critical enablers of data but the realisation of the DMP promise is being slowed because there are too few experts in DMP implementation and use. This knowledge gap must be addressed within all client, agency, publisher and, of course, ad tech providers.
“It is exciting for all involved in the industry because as we all start to better harness data, the marketing ROI will improve. However, we must not ever forget the human element, without a more enfranchised site/application end-user, gaining the permission to market will continue to be a problem. Ad blocking is an obvious manifestation of the current end-user disenfranchisement, but we ignore the EU legislative process at our peril. We all need to act now to convince the legislators to develop the draft EU Data Protection Regulation so as not to kill data-driven marketing.”
How close are advertisers to being able to buy ‘traditional’ media inventory (TV, OOH etc) programmatically?
“The opportunities outside of the PC, tablet and smartphone remain limited. Ad serving to DOOH is an exciting area where we are investing a lot in innovation, with live data feeds and consumer interaction enabling some really exciting creative relevance and consumer-affinity. But the trading piece remains extremely nascent. Specialist screen networks, in particular within retail estates and travel terminals will likely evolve most quickly, but I don’t see large format street/road-side billboards adopting line-by-line trading anytime soon. I will be delighted to be proved wrong!
“Turning to TV, programmes that have been ‘device-shifted’ should be a great testing bed for ‘programmatic TV’, but anything on the TV remains limited by both the TV advertising technology and the legislation associated with TV advertising.
“Another factor delaying programmatic TV is that the networks enjoy significant audience premiums based on delivering mass audience; an addressable or optimised audience-buying model would compromise that, so I don’t see ‘programmatic TV’ taking a majority share of TV budget anytime soon.
“My hope is that, as the technology and legislation evolve, we can establish ‘programmatic creative optimisation’ to validate the commercial uplift associated with a more addressable approach – and then programmatic TV trading may follow.”