Commentary

Is The Novelty Of Programmatic Wearing Off?

Is the novelty of programmatic wearing off? The topic still piques the interest of buyers, sellers and everyone in between -- but some of that rose-colored tint could be fading.

A recent report from the Winterberry Group and Direct Marketing Association (DMA) notes that enthusiasm about the future of data-driven marketing is at its lowest point in two years.

One a scale of 1-to-5, with 5 indicating a “strong” level of confidence in the future of data-driven marketing, the average response gathered by Winterberry was 3.87. This is still high, but it is the lowest average response number that Winterberry has recorded since first-quarter 2013 (3.76).

This diminished confidence has not impacted data-driven spending -- quite the contrary -- but it’s worth noting nonetheless. Could it be the start of a trend? 

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Perhaps it’s because viewability rates are floundering, or because fraud concerns have persisted. It could be because murky definitions on central terms such as “premium” and “programmatic” linger. Maybe it’s simply because programmatic is not the new kid on the block anymore.

Winterberry theorizes that it could reflect “broader anxieties about the economy amidst lackluster early-year growth forecasts.”

Marketers are also starting to encounter the difficulties of juggling technology. Winterberry notes that “a majority of panelists agreed that it’s been difficult to prove value from new platforms and integrating new and existing tools has been a challenge.”

In any event, we’ll have to wait for the next Winterberry-DMA report to see if this confidence slip indicates a trend, or whether it will simply be an outlier. After all, according to Winterberry’s chart, enthusiasm surrounding data-driven marketing tends to dip during the first quarter before rising in the second.

Winterberry conducted an online survey of 239 DMA members for the report in April 2015. Respondents included 166 marketers and 127 marketing services (including agency services) and technology providers.

1 comment about "Is The Novelty Of Programmatic Wearing Off?".
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  1. Ed Papazian from Media Dynamics Inc, May 28, 2015 at 10:22 a.m.

    An interesting piece, Tyler. While "programmatic" was designed primarily for digital media and focused on cost efficient targeting tonnage, it's application to "legacy media", which is widely touted, has not been the easy transition that the dreamy- eyed pundits have forecasted. As more people are actually thinking about such applications and the limitations of the supporting data as well as the presumed "benefits", many problems and shortcomings are becoming evident. Such "reality checks" will temper enthusiasm considerably.

    This is not to say that the "programmatic" approach is not a plus for digital buying and, especially, sellling. It clearlly is. Moreover, the enthisiasm of people who have staked their careers on the "programmatic" concept, is perfectably understandable and I get why they would like to take over "legacy" media---by which they really mean TV. That's the "biggie" in media, so why not expand automated  buying/selling to include TV? "Today, digital---tomorrow the world". I would probably feel the same way were I a "programmatic" desciple and eager for advancement.

    The problem is that "programmatic", as constituted, doesn't fit the needs of many branding advertisers and it certainly runs counter to the interests of most TV time sellers. Sure, a few very low rated channels may get some buys via a programmatic system from CPM fixated "trading desks", but it's most unlikely that any of the major sellers will buy into a system that allows the buyers to cherry pick whatever they want from their program schedules---whenever they need it--at the lowest possible CPM. That's not the way to optimize your ad revenue yield.

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