• by Lori Dekker , June 16, 2014

A few months back, the IAB and Winterberry Group made a splash when it released a report stating (among other things) that 85% of advertisers use programmatic strategies. By this light, one could assume that programmatic has reached prime time, with brands using it close to, if not exactly at, its full potential.

Not so fast. Every day we work with marketers to launch their programmatic campaigns, and our experiences tell another story. Though programmatic clearly provides tangible insights, too many marketers are settling for mere reporting of campaign data. The two are hardly the same animals.

Reporting is simply compiling all the campaign data that a DSP generates, along with third-party data into colorful dashboards and skew charts. But what does that really tell you about your customers?

For instance, what does banner CTR tell you about the context of a consumer’s experience? Can you discern how  creative influenced a consumer, and the extent to which it contributed to a conversion? Does time of day and number of ads seen add to that influence? And how can you use the data to find new customers?

The answers to these questions are true insights, and they can be used to make your next campaign stronger in terms of goals achieved and additional insights gained.

Marketers can’t even begin to answer these questions until they adopt a programmatic mindset. What’s that, exactly? It’s a willingness to second-guess your assumptions going into a campaign, and let the programmatic software discover new markets without prejudice. And it’s about crafting your campaign so that gleaning insights is as important as achieving your stated goals.

Trust me, as an industry we’re not there yet. Most marketers have a fixed idea of who their customer is, and disabusing them of that notion can be an uphill battle. Now, those marketers have probably collected data on their top-performing customers, and they’ve used it to model prospects to target. A sound tactic, to be sure, but one that can be rather self-perpetuating. Who’s to say stay-at-home moms won’t be just as interested? Without a programmatic mindset, you simply can’t explore additional markets.

As a programmatic provider, I find this frustrating. Typically, we’re assigned rather old-school goals, such as: target teens, spend money efficiently to drive RoAS, and optimize CTR to win new business.

Which of these goals is paramount? If the top goal is to target teens, as a buy-side platform we can purchase eXelate demographic data and message teens all day. But that doesn’t mean they’ll convert, which makes the tactic a surefire way to miss the RoAS goal. I can optimize my programmatic algorithms to drive banner clicks so I deliver a high CTR, but we all know that there’s no significant correlation between clicks and conversions. (Let’s be honest here.)

If winning new business is top priority, I’d really prefer to implement a true programmatic solution, beginning with optimizing on the view-through. I’d pixel every consumer exposed to ads, as well as consumers who clicked on the banner. And I’d pixel the places where true conversions occur (e.g., Thank You For Order page). Only then will I have the ability to understand which ads, ad frequency, and other attributes have the greatest impact on sales.

I’d also set aside a portion of the budget to prospect non-teens, just to see where there’s interest. That’s the great thing about programmatic: it will focus on additional markets if you let it.

Unfortunately, too many marketers and their agencies won’t agree to this approach because they’re stuck in a pre-programmatic mindset. They want metrics their CFOs understand and attribution models that make for easy story-telling. Unfortunately, the old-school approach makes for some pretty mediocre marketing.