Brands are becoming more focused on the use of data and analytics and the idea of programmatic to better understand and engage consumers says DataXu co-founder and CEO Mike Baker.
Efficiency is, and has been, programmatic’ s biggest selling feature, but in 2014, we’ve seen brands become more focused on effectiveness, that is, the use of data and analytics to better understand and engage consumers.
There’s also been a realisation that programmatic is strategic – it’s not just about lowering costs. It’s about creating a better customer experience using data and analytics. Clients are now talking about the value of the consumer behaviour data generated by their digital marketing investments. About controlling the data themselves. As clients become more educated, we’ve also seen a greater desire for transparency across pricing, media placement, tactics, all aspects of the media ecosystem.
Programmatic adoption
Adoption is now pan-industry. Look at auto, which is a huge user of programmatic. It’s a high consideration, expensive item, and manufacturers are capturing rich intender data from online research. This data is being activated through a DSP that can turn it into better ROI. On the opposite extreme, we’ve seen just as much adoption by FMCGs, even though their digital data assets are less developed, because programmatic efficiencies are incredibly appealing to intensely competitive industries like FMCG.
2015 will see virtually all brands deploying programmatic advertising at some level. If you don’t have a programmatic plan in place in 2015, you will lose share to your competitors. And we’ll see the leaders scale up multi-country, cross-device programs where audience data is pooled and re-deployed at the speed of life to create highly engaging connected consumer experiences. Fact is, the reach of programmatic has dramatically expanded from low value banner exchanges to private exchanges with premium inventory and ‘programmatic direct’ buying across mobile apps, video, social – even addressable TV. All of this goes towards the strategic objective of more effective marketing, which requires a scalable way to predict consumer behaviour and influence it with proven creative communication.
The US has historically seen the earliest and greater activity, but looking forward Asia and Europe, especially Eastern Europe, will grow most quickly. Soon the majority of programmatic buying will be outside the US. In terms of programmatic strategies, I think we’ll continue to see some of the most thoughtful, well designed work emanating from the UK!
Quality guarantee
Fraud is certainly an issue. When there’s low quality media in play, it devalues the ecosystem. We’re seeing some tentative moves by the supply side, but until there’s wholesale action, marketers are going to have to rely on their buy side partners to protect them with quality guarantees like the one we recently announced. Trust is just so important in these new, fast moving, hard-to-understand areas of the ad economy.
Clients increasingly view programmatic platform providers like any other licensed enterprise software solution. Procurement and IT are often involved in the purchase decision. Agencies are in a great position to expand their role into being an expert service layer, not just the platform operator, and can renew their media expertise in a data-driven world.
Programmatic consolidation
We are seeing a lot of activity from Global 1000 companies standardising on a single platform across countries: the Center of Excellence with Local Execution model. It provides unity and scale, tailored to local needs, but with the data and analytics normalized and rolling up in one system, it also provides unprecedented insight and effectiveness. Cross-device marketing and addressable TV will also be big themes in 2015.
For much more analysis of the biggest trends shaping global media and marketing, order your FREE copy of M&M Global presents: International Media 2015 here.
