Buzzword Of The Day: Programmatic Direct

by , Nov 27, 2013, 9:53 AM
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There’s a hot topic getting tossed around quite a bit as of late: programmatic direct, which furthers the notion of all online advertising headed toward an automated, dashboard-driven future.

It’s a very simple concept if you think about it, the “Buy Now” button from eBay applied to media.  Rather than having to wait and go through an auction for buying inventory, you can simply “Buy Now” and get guaranteed, premium inventory direct from the publishers you want to work with.  Immediate gratification and buy certainty all rolled up into one.

Some fear that programmatic direct signals the end of the direct sales team, but I disagree. It’s short-sighted to think that dashboards and robots will ever 100% replace the power of brands, because people are at the core of this business. Consumers like brands and this is proven time and time again, so premium sites will always wield some power in marketplace. These brands will always have direct salespeople speaking to buyers. 

What programmatic direct does replace is the antiquated insertion order and billing process “enjoyed” by the advertising industry over the last 50+ years (and yes, I put quotes around “enjoyed” on purpose, to demonstrate the sarcasm associated with loving this process).

Programmatic direct is inevitable.  It will increase efficiencies in the business and it will eventually become the backbone of the upfronts across all media, not just online.  I have written about this in the past in a more hypothetical manner, but this technology is going to be integrated everywhere.  As John Battelle recently wrote, the technology behind online advertising has global implications across all aspects of business. The stepping-stone to get there is the expansion beyond “adtech” and into all advertising in general. 

But is there a clear winner in this space, or is access a commodity that every platform will enjoy?  I doubt any single platform will gain exclusive access to the top 50 premium content publishers.   If I were one of them, I would make access available everywhere because it’s all about reach.  That means every DSP and exchange in the LumaScape will have access to the same inventory, further leveling the playing field.  As someone joked recently, if a DSP tells you they have access to over 200 million users, that means they have access to the same exchange inventory as everyone else.  Differentiation comes in more subtle ways, like customer service, algorithms and analytics. 

I could even foresee a world where the large publishing groups offer their own core DSPs, enabling programmatic direct through their very own portals, and syndicated out to every DSP. Programmatic direct is important enough for publishers to make the investment in technology to manage the systems.   It’s even more important as we start to consider mobile and video content as premium.  These two areas are going to increase in value over the coming months, and publishers are going to offer increased avails of audience segmentation against this inventory, which will be coupled with a desire to monetize them in a more efficient manner – i.e., no IOs.

So is programmatic direct a buzzword with teeth or not?  I say yes – and I would immediately elevate that from buzzword to actual term of value.  The industry is headed toward efficiency in all aspects.

1 comment on "Buzzword Of The Day: Programmatic Direct".

  1. paul debraccio from Sonobi
    commented on: November 27, 2013 at 11:03 a.m.
    Right on target as usual.I am sure there will be many secret sauces along the way, but overall it appears that this is where we are heading.

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