Programmatic Is Strong, Not Fat

A few weeks ago, RTB Insider ran a post on a topic referred to as the programmatic industry’s “obesity problem.” The column pointed to five ways that ad-tech companies are jeopardizing the health of the industry. The gist of the article: More is not always better.

But here's the way I see it: The availability of more data and more inventory is a positive indicator of an industry on the rise. Programmatic capabilities driven by technology are a catalyst for positive change. Technology gives us the power to scale, prioritize and optimize programmatic excess to the benefit of both supply and demand.

No Question, No Answer

It’s easier than ever to store data inexpensively, either temporarily or indefinitely, so many companies are doing just that.

Extracting insights from data is all about asking the right questions. The amount of data becomes arbitrary, or perhaps detrimental, if you don’t know what you are looking for. But if you’re asking the right questions, if you know the problem you are trying to solve, it becomes easier to parse the data and deliver meaningful insights. Many data-heads out there will argue that when you are doing it right, more is usually better.



More On the Menu

Going to a restaurant with a massive menu can be more exhausting than enticing. Less to choose from means easier decision-making and higher satisfaction. Much the same, some critics are exasperated with the exponential amount of inventory available through the programmatic channel. Inventory won’t be declining any time soon. In fact, the Internet just surpassed one billion websites and continues to pick up the pace of growth each day.

Having lots of inventory choices can be a good problem: It means more options for advertisers. The pressure lies on ad-tech companies, particularly DSPs and SSPs, to continue to improve segmentation and targeting for efficient consumption of inventory that meets campaign KPIs.

Which brings us back to data, the crux of programmatic buying. Continued innovation in data collection, storage and access will allow the industry to gracefully scale with inventory growth, while improving results for advertisers and publishers alike. Optimize your understanding of the menu, and the right choice becomes much more obvious.

Fighting For Transparency

As for the article’s view on “technology tax,” or the current cash hemorrhage between money invested in brand media and the cash that actually makes it into the hands of publishers, I am in full agreement. The old quote “if you aren’t mad, then you aren’t paying attention” comes to mind, though many publishers can’t or don’t know just how much they are being shorted.

We can pin most of the blame for this inequity on a glaring lack of transparency in the programmatic industry. Publishers deserve the same insights that the demand side of the industry is all but guaranteed. The odds have been stacked against publishers in the programmatic industry, though not for long. Data (audience) and media bundling is one approach that garners significantly higher CPMs for publishers, and therefore more of the revenue share. Bundling options, the emergence of new analytics platforms and increased standards for transparency in the market will eventually even the scales and trim down technology tax as the industry matures.

The need for transparency applies not only to technology tax, but also to network and traffic quality. With so much money on the table in programmatic, several ad-tech companies have chosen to take a stand against fraud in the industry, but it’s not enough. We as an industry must come together to take it a step further than just cutting fraud out of our own networks. To really make an impact, we need transparent and sustainable industrywide standards that ensure clean traffic for advertisers and publishers alike.

One such sweeping initiative aimed at tackling fraud in programmatic is IAB’s Quality Assurance Guidelines Initiative. The list of QAG compliant companies is growing every day, though it only scratches the surface of the entire pool of ad-tech industry players.

Strong, Not Fat

The massive size and rapid growth of the programmatic industry is overwhelming. Mountains of data, scores of inventory, fraud: these could be reasons to panic. But if we should be overwhelmed by anything, it’s opportunity.

2 comments about "Programmatic Is Strong, Not Fat".
Check to receive email when comments are posted.
  1. Skip Brand from bbd (branding big data), October 26, 2014 at 6 p.m.


    Very good points and I like your idea that we have no "FAT" and it is a strong market space. I can 100% agree with losing some weight and getting strong for this big opportunity. I am a glass 1/2 full person.

    Strong not fat questions, smaller menus or low fat, thin transparency, remove the fat tech tax and hard to argue against lots of choices. All good points.


  2. keith fagan from sovrn, October 28, 2014 at 6 p.m.

    Skip, thanks for reading. Appreciate your commentary and healthy feedback.

Next story loading loading..