• by Barry Lowenthal , Op-Ed Contributor, October 2, 2013

In 2009, when Varick Media Management was spun out of The Media Kitchen and became a stand-alone business managed by its own president and management team, our vision for how programmatic buying would change both the sell side and the buy side was validated.

As we started getting experience with automated buying, it became very apparent to us that automation through programmatic technologies just made great sense. Programmatic enabled us to hire fewer people, scale campaigns quickly, buy more efficiently and effectively, and reach only those consumers we cared about. Programmatic buying, driven by algorithms and data, also made our campaign reporting much more robust and insightful. But more importantly it allowed our Chefs (people who work at The Media Kitchen) to focus on tasks much more suited to their strengths.

Historically, the kinds of people who have gravitated to the media business have always been a nice combination of analytical and creative. I think digital media has allowed the creative media folks to become even more creative because they’re helping shape how the brand experiences are coming alive, and the analytical folks are becoming even more analytical because of all the new data we need to manage.

The rise of the trading desks, the groups that typically manage programmatic implementation, have created a place for people who excel at analytics, while the agencies are becoming great places for staffers who lean towards strategic comms planning and creative endeavors. The combination is a powerful one and the way we believe the media business needs to be organized. AOL talked about their barbell strategy for the publishing world should be go to market. The same approach holds true for media agencies. But we argue that the programmatic side needs to be even more central.

We believe The Media Kitchen’s role is changing as programmatic buying becomes more and more common. We want our Chefs helping clients make sense of all the new channels and buying approaches. We want them to provide strategic media counsel by focusing on communications planning, developing creative media and content programs, and experimenting in emerging media and new technologies. We want them forging relationships with new startups and strengthening relationships with existing media companies so we ensure first look opportunities. The trading desk should buy anything that can be bought programmatically. Our Chefs should be buying only those programs that aren’t automated and spearheading the total media conversation for the client, and that includes programmatic.

Currently, approximately 60% of The Media Kitchen’s billings are in digital media. 20% of the non-search digital investments are bought programmatically. According to recent reports, for most of our competitors that number is in the single digits. But we’re more digital than most of our competitors and everyone, regardless of their skew, is talking about how programmatic buying will become more important. As more inventory is available programmatically, budgets will flow even quicker to that channel, which will accelerate programmatic’s importance as a channel and buying strategy.

At The Media Kitchen, we’ve seen is how programmatic buying will change the face of the media agency and how the trading desk will become even more central to clients. As agencies manage less and less budget and trading desks manage more, agencies will take on even more of a consultative role, helping clients make sense of all the chaos, while the trading desks will become the primary way media is bought.