Programmatic, Not Automatic: Why Agencies Still Matter

Programmatic ad buying is becoming a firm part of the ad landscape. Procter & Gamble, Netflix and Kellogg’s are among major brands that have announced a focus on programmatic, and a recent AOL surveyof 177 U.S. brands, agencies, and publishers noted that 84% of those queried use programmatic buying in display advertising, followed by 60% in the mobile arena and 58% for video. More than half of those interviewed by AOL plan to increase their programmatic ad buying over the next year across all categories.

But does automated ad buying mean cutting out all human interaction in the process? With the perceived economic benefits of programmatic buying, more marketers are certainly seeking to purchase digital ads directly, rather than relying on agencies to do the work for them, according to a report in the Wall Street Journal.



But just as automated trading systems don’t make financial traders superfluous, neither does programmatic ad buying eliminate the human element. There is still a lot of human capital involved in setting up, running, managing and executing programmatic ad campaigns. Each brand will need to decide for itself how much of a role it wants to play, and what the functions of agencies will be.

There is a strong argument for letting agencies continue to serve as the creative juice behind these programmatic campaigns. Even the best technology does not substitute for good creative that reaches targeted audiences. Since programmatic advertising frees companies up from the time-consuming elements of setting up digital ad campaigns, such as planning and buying, that leaves agencies more time to focus on creating a compelling creative strategy.

Beyond creative, even if brands decide to take charge of their own programmatic campaigns, they may decide to outsource particular elements to their agencies. For example, agencies could be responsible for follow-up on campaign execution and analytics. In other cases, a company may decide that its agency already has certain close relationships with key media in the offline world, so will decide to keep its role as a prime media buyer in those instances. Agencies can also help brands manage their automated campaigns if need be, for example by helping them pick out the right automated platform to suit their needs. They can also help determine how programmatic fits into the brand’s overall media mix.

Lastly, savvy agencies are realizing they also need to branch out into new areas to keep their value-add on behalf of brands. That can include offering services such as digital consulting, interactive Web development or generating leads.

With that in mind, here’s my advice to companies: whether you decide to bring in in-house experts or outsource this function of your business, remember to stay true to the core fundamentals of your business. Don't veer away from your long-term business goals for what appears to be a short-term cost-cutting opportunity.

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