Programmatic trading may come with new technology, jargon and a multi-layered eco-system, said Caspar Schlickum, CEO of Xaxis EMEA, the WPP-owned real-time media trading arm, but the fundamentals of media haven’t changed. “It’s still about connecting the client to the audience,” he said.
Schlickum was speaking at the Agility strand of the IPA’s ADAPT agenda (7th May 2014). The session explored the role of programmatic – or automated, real-time, data-driven, trading and buying –in the changing advertising landscape. View photos from the session.
“We don’t define ourselves as a trading desk,” Schlickum said. “We prefer to think of ourselves as using data and technology to create audience products that we sell to clients.”
Schlickum contrasted programmatic trading of media with electricity trading. Neither power nor digital inventory could be stored – although both could be bought for future delivery – meaning the most efficient way to clear inventory was through the auction process.
Unlike electricity, however, not all digital inventory is the same. In the electricity market, neither buyer nor seller cares who they are dealing with, but in media buyers and sellers want to know who they are dealing with.
The ability of programmatic trading to serve the right message to the right audience at the right time was driving efficiency in the market, said Rohit Dhawan, director of project management for display at Google, and meant that clients were getting better results with less time.
Advertisers’ ability to use media in an agile fashion was enhanced by programmatic trading, said Nigel Gilbert, vice president sales, EMEA, for technology platform provider AppNexus. He cited an Oreos online ad – ‘You can still dunk in the dark’ – featured during a power outage in the 2013 SuperBowl as an example of agility.
But there were other ways real-time trading demonstrated agility, Gilbert added, such as real-time optimisation based on changes in the weather or, as in the Netherlands, where advertisers monitor TV-related second-screen brand conversations and serve up appropriate or relevant ads.
Gilbert quoted a Vodafone campaign to sell roaming packages to Vodafone customers in the Netherlands. Identifying only Vodafone users thinking of going on holiday or already abroad, dynamic creative served in real time to mobile devices improved CPA by 315pc.
Steve Hobbs, managing director of Amnet UK, Aegis Group’s trading desk, said that by embedding programmatic trading within the agency, it had improved media performance. “If you do this, you can put a bridge between the planning and the buying in order to target a specific audience. The data can help you learn more about the way consumers are interacting with a client or its online assets – where they are in the conversion process and so on. Then you can target them appropriately and with relevant ads.”
The ability to behave in an agile fashion was one reason the value of display or brand advertising traded programmatically was now around £500m a year in the UK, Gilbert said.
Winning over brand budgets
Historically the preserve of performance-related campaigns such as CPA, more brand advertising was going via programmatic trading, said Dhawan. There were three reasons for this: one, trading desks had more access to premium inventory; two, more engaging ad formats were available; and three, more brand-oriented metrics were able to measure the effect.
In part this was driven by the rise of mobile. Web access via mobile overtook desk-top access last year, and 80pc of time spent on mobile was via apps. For brand advertisers seeking awareness and timeliness, mobile was a relevant channel, Dhawan said.
But there were issues still to be resolved, he added, including fraudulent or ‘bot’-driven traffic, and the question of viewability [ads registering an impression but typically served below the fold and thus not seen].
Privacy or intrusion was also an ongoing issue, and Google was cautious about over-stepping the mark, especially cross-tracking device usage, Dhawan noted.
But this was where agencies had to take a long-term view, said Hobbs. “It’s about being responsible and relevant. If we serve up irrelevant ads,” he said, “we’ll kill the system. It has to be sustainable, and if we’re reckless about placing ads we’ll fuel privacy concerns on the client’s behalf.
The massive complexity of the programmatic eco-system was also an issue, panellists agreed. “There are many third-party players [demonstrated by the LUMAscape charts] – that there is value leakage and data leakage,” said Schlickum. “It’s a problem.”
The rise of programmatic trading did not mean, however, that the role of creativity was diminished. Multiple executions were needed and, said Schlickum, “programmatic can help creative tell the story by putting the right ad in the right place.
“There’s also a role for creativity to start consumers thinking in the wider sense about the product, “ Schlickum said, “or make them aware, and then programmatic can help take them through the funnel process.”
Nor did it mean, he added, “that there would be a time when everything would be traded programmatically. It’s about a balance with set-piece media, carefully bought and creatively planned.”
Learn more about IPA President Ian Priest's ADAPT agenda. The next Adaptathon will focus on Performance and will be held on 8th July 2014.
Last updated 09/05/2014