Programmatic’s history as a solution for monetizing remnant, or long-tail inventory on the publisher side and for buying direct response (DR) campaigns on the advertiser side is no secret. Luckily for us, programmatic has come a long way since it was first introduced a little over ten years ago, steadily moving up the funnel and evolving to provide publishers and advertisers alike with more efficient, effective ways to buy and sell even the most premium inventory and brand campaigns.
A driving force behind at least some recent advancements in programmatic technology is the influx of brand spend being shifted to this channel as major global brands—perhaps the most vocal being P&G, whose Chief Brand Officer, Marc Pritchard, recently demanded higher standards of transparency and quality in digital media and advertising. But how do these comments translate to brand dollars driving programmatic innovation?
Pritchard’s comments at the IAB Annual Leadership Meeting (ALM) in Hollywood, Fla. and other recent industry events Illustrate the “strings” attached to brands’ increased programmatic spend—in the case of P&G specifically, these include higher standards around agency fee transparency and more stringent viewability standards designed to lead to better consumer experiences. As Pritchard put it, global brands like P&G expect “a transparent, clean and productive media supply chain” in place of the “crappy advertising accompanied by even crappier viewing experiences.” Brands like P&G command massive advertising budgets—budgets that can be leveraged to encourage agencies and other digital media players to “clean up their act” or risk losing out on significant opportunities.
In this series of posts, we will examine three key areas of innovation being affected by the continued (and accelerating?) shift in programmatic brand spend: first, data and analytics; second, ad decisioning and ad serving; and third, the future of programmatic that we like to call the “Biddable IO.” At PubMatic, we believe that the combination of technology advancements in these three areas in particular ultimately will lead to the higher degrees of transparency and quality called for by brands like P&G.
Part I: Data & Analytics
As these programmatic ad spending shifts continue, areas that are key to determining campaign success and return on investment (ROI), such as data and analytics, are receiving more focus than they did previously. In fact, a recent survey conducted by the IAB and Winterberry Group found that the majority of those surveyed (73.7%) cited “Better reporting, measurement or attribution” as the general topics or industry developments they anticipated to command their attention the most during 2017, compared to less than half (48.9%) the previous year.
Several studies from eMarketer showed similar results as well. An October 2016 survey of U.S. publishers, for example, found that nearly twice as many publishers believe that a “Lack of analytics resources” (19.3%) contributes more to the price difference between direct and programmatic inventory as “Advertiser behavior that is out of [their] control” (10.5%) does. Another survey of US and UK media analytics professionals found that the three greatest challenges associated with their existing analytics reporting tools included:
- Large amounts of data (60%)
- Disparate data platforms (59%)
- An inability to get a single view of multiple data sources (56%)
The ability to access real-time data and robust reporting is critical for publishers and advertisers if they are going to continue to leverage the benefits of the dynamic pricing available with programmatic technology like RTB (real-time bidding). Almost half of all large and small US and UK media companies surveyed by Forrester Consulting in a study commissioned by PubMatic listed “Pricing of inventory across these channels,” “Prioritization of deals,” and “Optimization of inventory” as business decisions being made based on analytics. A November 2016 survey of marketing technology professionals listed “Data science, analytics, statistics, modeling” as the second most important technology skill for future marketing success.
As of May 2015 (more than six months after we first launched our real-time Analytics solution), only 27% of media analytics professionals surveyed in the US and UK reported that the exchange and/or SSP platforms they used updated data in real-time, with 22% reporting that their data was being updated only every few hours and 17% reporting that their data was updated only daily. As technology continues to accelerate media and advertising, these kinds of delays become not just problematic, but can ultimately have a negative impact on publishers’ ability to optimize and run their business successfully.
Clearly, as publishers and advertisers (not to mention major brands) shift more of their budgets to programmatic, they are no longer able to rely on the kinds of data and analytics tools they used in the direct-sold ecosystem of old. That’s why we developed our own data and analytics solution here at PubMatic, with an eye towards the specific needs surrounding programmatic transactions, such as the ability for publishers to optimize in order to achieve the best monetization possible and the ability for advertisers to determine the ROI of their campaigns accurately.
Check back for the next installation of “The Impact of Programmatic Brand Spend” blog series, which will address some of the innovation happening around ad decisioning and ad serving as brands continue to raise the bar in terms of transparency and quality. Find out more about PubMatic’s data and analytics solutions, visit www.pubmatic.com/solutions/data-analytics.