• by Richard Jalichandra , August 25, 2014

A recent op-ed asked the following question: After reading reports that “Procter & Gamble plans to buy 70-75% of its U.S. digital media using programmatic ad tech by the end of this year, I couldn't help but wonder: Is this a good way for the largest advertiser in the U.S. to spend a nearly $2 billion budget?”

My reaction to Proctor & Gamble’s announcement was, well, the exact opposite. It won’t happen overnight, to be sure, but the tides are changing. Slowly but surely, digital budgets are being automated.

But when it comes to RTB, I couldn’t agree more. Brands are going programmatic, but they won’t be relying just on open exchanges.

What We Talk About When We Talk About Programmatic

When RTB first came onto the scene, it was expected that brand dollars would shift entirely from manual direct media buying to audience-based RTB buying. So far that has failed to materialize, but it isn’t a matter of time, it’s a matter of method.

RTB was a powerful invention that dramatically changed how we think about buying and selling ads, but it was only the beginning of automation in digital advertising. Brand buyers need controls and guarantees for their biggest budgets, and RTB can’t offer that. But they still need automation, which they can get through newer forms of programmatic buying inspired by the success of RTB.

Under Control

Open RTB may not win brand budgets as predicted, but big spenders are looking for ways to automate the lengthy direct sales process that doesn’t sacrifice the control they need.

Fortunately, there are options for automation in addition to open RTB. An emerging space, dubbed automated guaranteed by the IAB but referred to sometimes as programmatic direct, is bringing automation to reserved inventory. This segment offers the same efficiency benefits as RTB, which is a major concern for brands and agencies alike, both of whom have struggled to streamline the costly media-buying process. At the same time, automated guaranteed doesn’t pose the same risks as open RTB.  Buyers are still choosing the specific publishers they want to work with, negotiating deals in a forward market, and selecting specific, well-defined ad units.

Premium Publishers’ Perspective

The best publishers on the Web, even those who do use RTB, still reserve their best quality inventory for direct, guaranteed sales. These publishers have their own brands to be concerned about, and many aren’t willing to take the risk of unsavory ads appearing on their pages.

But publishers face the exact same problems as media buyers when it comes to direct sales. Guaranteed media deals are just plain expensive to execute, even if they are a preferred method.  That’s why publishers have led the way when it comes to automation.

There’s a clear win for both sides, so agencies (and brands) are actually able to access that same high-quality inventory on the reputable sites they’ve been buying from all along.

The Future of Automation

Ultimately, we will see brands like Procter & Gamble and American Express and agencies like GroupM automate every transaction that can be automated. They just won’t be doing it the way we thought.