Commentary

Can Programmatic Ad Buying Truly Deliver?

When I read the latest industry headlines, I feel like going up to every major brand and asking this: “Do you truly know what you’re buying and how it is impacting your brands?” Major brands and corporations, like CPG giant Mondelez International, are shifting strategies, allocating the majority of spending towards automated delivery mechanisms like ad exchanges, DSPs and Agency Trading Desks.

But as ad tech companies attempt to drive television budgets into digital video and brand marketers’ increase their spending, programmatic ad buying seems like both a blessing and a curse. I get why many find it appealing. It offers very low rates, data targeting and efficiency. And if executed through private exchanges with premium inventory and effective audience targeting, it can add value. If the long-term vision of digital media is to be evaluated as a direct response vehicle, then the industry has found its solution. However, there is nothing to prove that it can deliver on essential digital brand marketers’ objectives.

Technology has forced advertising to evolve, but I’m not sure it is for the better. In the old days, marketers would blast one message to many people. Enter in the Internet and then mobile, which has dramatically altered media consumption, forcing marketers to target smaller niches across unique device types. Oftentimes, due to creative specifications or technological compatibility issues, brand marketers are turning to automated delivery mechanisms, thinking that data and “revolutionary” ad technology bought through programmatic methods is the best way to ensure that they can get their ad in front of the right person at the right time.

The trouble with this approach is that it puts brand marketers in a compromising position, because while technology has evolved their KPIs have remained the same.

According to a recent Millward Brown Digital survey that polled over 300 digital marketers in the U.S., nearly half of respondents said that making emotional connections with people through digital ads is a key branding objective. Seventy percent said that they want to make emotional connections to build brand recognition, loyalty and trust. They believe that doing so will help build their brand, which has been the point of advertising from the onset.

Even still, the industry is heading in the wrong direction. Research shows that many marketers and decision makers have negative opinions about programmatic ad buys. For instance, only 12% of U.S. senior ad agency executives polled in a recent survey said that they trusted programmatic ad buying to properly or accurately execute their ad orders, says eMarketer data, while over 60% of respondents didn’t feel that the ad industry had an accurate and unified definition for the term. Thirty-seven percent of the Millward Brown Digital study respondents said that “banner blindness” concerns them most when buying branding ads through programmatic methods, while a significant portion said that programmatic methods produce negative customer experiences, which would negate their branding objectives.

What’s more, programmatic ad buying predominately delivers standard ads that users don’t see or respond to, including standard banners and pre-roll video ads. These formats certainly don’t give brand marketers a way to make powerful connections with users or inspire viewers to appreciate brands’ messages. And if it can’t do that, what’s the point of running digital branding ads at all?

In this scenario, digital brand marketers are likely compromising creativity for efficiency and scale, because they don’t know what else to do. But they don’t have to settle for second-rate inventory, creative or targeting with a one-size-fits-all solution. They still can overcome the hurdles that digital is posing on them. To do so, they can’t lose sight of how important creative and relevant messages are to their target audience or forget about their core objectives. They must find innovative technology platforms that will deliver contextually relevant, high-impact formats in premium inventory, offer full share of voice and meet their branding objectives—whatever they may be, such as making true people-to-brand connections and beyond.

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4 comments about "Can Programmatic Ad Buying Truly Deliver?".
  1. David Reinbach from Zenith Direct , July 1, 2014 at 10:02 a.m.
    You're missing the point...programmatic is primarily about automating buying/selling to reduce head count at agencies and publishers. Everything else is collateral damage.
  2. Ari Brandt from MediaBrix , July 1, 2014 at 11:09 a.m.
    David - I don't think I'm missing the point. I'm all for automation. What I'm saying is we're CURRENTLY automating recs, leaderboards and pre-roll. All forms of advertising that have been proven to be ineffective for branding. The current iteration of programmatic is "potentially" great and effective for bottom funnel KPIs, but if your clients care about what people think about their brands, we're not executing correctly as an industry.
  3. David Reinbach from Zenith Direct , July 1, 2014 at 11:39 a.m.
    I'll agree with that. Speaking about "bottom funnel KPIs", add this... it's the consensus of DR advertisers the digital video does not, "pay out" compared to TV or search.
  4. Doug Garnett from Atomic Direct , July 1, 2014 at 5:40 p.m.
    Digital video doesn't "pay out" like others. I always observe it's really easy to make & post online video. it's extraordinarily difficult to get it seen. Even worse, to get it seen at a point in time when the consumer is receptive to hearing what you have to say (if it's meaningful to them)... The Ad Contrarian had a great post this week about how strange the process is for automated placement online. My thought is...it automates mediocrity. And now we're moving the same mediocrity to TV. What a great advance in advertising.