A look back at programmatic – how far we’ve come
This article was first published on MediaPost on 1/9/14
Redefining RTB For The New Year
Scale was never a problem with programmatic media; as FBX and Twitter add more inventory to ecosystem, they join the ranks of exchanges everywhere who pool together billions of impressions each day to give buyers flexibility in how they reach the right user in the right place at the right time. But the available scale just doesn’t seem to be the right mix for branding campaigns, and thus the argument of RFP vs. RTB continues.
However, change is in the air. And that change will be the central theme of 2014: the year in which RTB comes to mean real-time branding. Market forces are aligning and technology is evolving to allow for both sellers and buyers to create real-time marketplaces for branding campaigns. And these forces will create another year of hyper-growth in programmatic media. Let’s look at these forces and how they are converging/intersecting to allow for the coming wave of real-time branding innovation:
- Initiatives like Traffic Of Good Intent at the IAB and a focus on transparency & quality over the last two years have created a “flight to quality” from aggregators committed to ensuring that marketplaces are clean and well-lit. Just because an impression isn’t from a comScore top 250 site doesn’t mean it’s unsafe for a brand. In fact, niche enthusiast sites are often more engaging for their audiences than large traffic sites with short site visitation patterns.
- Agencies see margin growth & protection from the efficiency & precision of RTB. This will inevitably cause them to look for any opportunity to turn lower-margin media dollars into higher-margin media dollars, and that means running them via RTB. But since the performance campaigns are already running through trading desks, the next kinds of campaigns to run will be branding campaigns.
- Brands continue to build their own trading operations, if not as a traditional brand trading desk, then as specialized, in-house division of their own marketing department.
- The availability of branding campaigns will continue to draw more and more inventory into private exchanges. Old-guard publishers like the New York Times and Gannett are hiring programmatic specialists (Matt Prohaska and Ross Geier, respectively) in order to help them understand how to package inventory and manage yield across direct and programmatic channels. But these publishers are packaging up premium inventory & custom solutions at higher CPMs, not just RON impressions.
- Aggregators are looking to build custom solutions in RTB to allow for brands to achieve scale efficiently.
- Brand dollars often seek users higher up in the funnel, which means they seek users before a cookie is set, increasing the scale of available inventory but also reinforcing the importance of environmental data (context, category, page-level data).
- DSPs are building workflow tools and are increasingly using signals like DealID to facilitate direct buyer/seller relationships.
Real-time branding means the influx of ad dollars that will force publishers to place premium impressions in programmatic platforms — large ad sizes, customized units, higher CPMs — and therefore the chicken/egg, prisoners’ dilemma problem becomes a virtuous circle of programmatic growth and continued accelerated adoption.