Commentary

About Half Of Agencies 'Unsure' They Trust Programmatic

Programmatic advertising is obviously top of mind for many in the digital ad industry, but not all ad agencies are convinced the technology properly executes ad buys.

About half (46%) of agencies are “unsure” if they trust programmatic to execute ad buys, according to Strata’s latest agency survey, taken during Q2 2015. That’s a significant increase from the roughly one-third of agencies that said they weren’t sure if they trusted the tech at the beginning of the year. And 11% said they do not trust it, a drop of 32% quarter-over-quarter.

But when looking at previous Strata agency polls, it appears that agency trust in programmatic has plateaued. During Q3 2014, for example, 20% of agencies said they trusted programmatic — the exact same number reported in Q2 2015. That's actually a drop from Q4 2014, about one in four (24%) of agencies said they trust programmatic.

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In other words, for about a year now, the number of agencies that fully trust programmatic has been hovering somewhere between one in four and one in five. That’s about the same number of agencies (23%) that reported in Strata’s most recent survey they don’t use programmatic.

Still, these trust issues haven’t stopped some agencies from using more and more programmatic to carry out their business.

Strata notes 17% of agencies (an increase of 244% from one year ago) say they use programmatic to carry out between 20% and 40% of their business. Another 39% of agencies (up 18% from one year ago) use programmatic for 10% to 20% of their business.

This increased spending also comes at a time when agencies are still wary of quality issues. Per the survey results, 30% of agencies say “inventory transparency” is the top concern associated with programmatic buying, followed by quality of inventory (28%) and the lack of education in the space (18%).

The benefits of programmatic, per the agencies surveyed, are improved audience targeting (27%), improved buying efficiency (26%) and improved campaign insights (20%).

Data from the Q2 2015 Strata agency survey can be found here.

10 comments about "About Half Of Agencies 'Unsure' They Trust Programmatic".
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  1. Augustine Fou from Marketing Science Consulting Group, Inc., September 3, 2015 at 11:52 a.m.

    And for good reason...  

    Most often, they don't know where their ads ran, their anti-fraud and viewability tracking tags only sample a tiny fraction of the inventory and extrapolate cleanliness from that, and they only get rolled up numbers to tell them how many ad impressions were served (not even whether those impressions arrived in the browser). 

    But programmatic spending still goes up because the low cost inventory is like crack cocaine -- and can be mixed in to overall buys to show clients MORE ad impressions for LOWER average cost. 

    Until advertisers and their agencies focus more on actions, goals, conversions, etc. that only real people take on their websites, this problem is sure to continue, despite the decrease in "trust" in programmatic. 

  2. Michael Lynn from Storandt Pann Margolis, September 3, 2015 at 11:52 a.m.

    The agencies that "trust" propgrammatic don't understand it!

  3. Michael Hubbard from Media Two Interactive, September 3, 2015 at 11:57 a.m.

    I only read this article, and maybe I should read the full Strata study, but I'd be interested to know if the agencies that had concerns of programmatic are simply using a DSP with no knowledge of running things directly through a trade desk or self-serve model.  With top three concerns being "inventory transparency, quality of inventory and lack of education" - I think it's very clear that they have just dipped their toes in, but have no idea what's under the hood.  The number 1 reason we got into programmatic was for the transparency, and being able to white list sites so we didn't have inventory quality concerns...  That all said - I live and breathe media, and media only - so my guess is the study hits a lot of full service shops that maybe don't have all of the resources we do, so they place some ads with RocketFuel and say they're doing programmatic.  No slam on Rocketfuel, we use them too - but to me that's executing a media buy and not executing a programmatic buy.

  4. Michael Hubbard from Media Two Interactive replied, September 3, 2015 at 11:59 a.m.

    Do you truly trust any ads you purchase whether it's direct or programmatic?  There's a reason DoubleVerify and a lot of other fraud protection units exist.  Trusting it and understanding how to leverage it are two different things - and I trust that I understand it enough to make it extremely effective.  

  5. Eric Schmidt from Winfield & Associates Marketing & Advertising, September 3, 2015 at 12:18 p.m.

    We've done some limited testing with a direct response client and the programmatic did not produce leads. When we placed directly with websites targeting our demo we've had some success. Creative was consistent across the platforms. Interestingly, transparency wasn't one of the issues. Just speculating, but because the inventory is spread across so many properties frequency, or lack of, may be a contributing factor to our lack of success.     

  6. Augustine Fou from Marketing Science Consulting Group, Inc., September 3, 2015 at 1:01 p.m.

    Programmatic display is meant for awareness, not necessarily leads.  Search would be a much better option if your goal is leasds. 

  7. Augustine Fou from Marketing Science Consulting Group, Inc., September 3, 2015 at 1:03 p.m.

    There is HUGE potential in programmatic -- including unprecedented levels of transparency and detailed knowledge of where EVERY SINGLE ad impression was run, whether it was viewable, and whether it was seen by a human. 

    It is simply that at this (early) stage of adoption, it is not being used to its full potential. Advertisers and their agencies should be more vocal and forceful in DEMANDING more data and transparency. 

  8. Doug Garnett from Protonik, LLC, September 3, 2015 at 10:45 p.m.

    From what I see, programmatic opens the door in TV for the same kind of fraud that is rampant I'm digital. They are right not to trust it.

    I'm fascinated by claims like Augustine's that it brings "unprecedented levels of transparency". When you are buying 30 million impressions, you won't know all that detail. And that's why I observe it opens the door to fraud - especially since it's run by "trust us it works" black boxes.

  9. Romain Job from Smart AdServer, September 8, 2015 at 10:13 a.m.

    Interesting: 46% is probably a good estimation of the junk traffic running on the mainstream exchange. 

    There is a clear move toward quality today: buyers mostly don't trust blind inventory anymore, PMP and deal ID trading has grown massively and already represents most the the programmatic buys in term of spendings on our SSP  for instance.

    Agencies who have experienced programmatic have learned already and they now take a lot of care of where they source their inventory!

  10. Doug Garnett from Protonik, LLC, September 8, 2015 at 7:05 p.m.

    Don't trust "blind inventory"? You mean...like the programmatic TV buying I've experienced?
    Not to be snarky here. Just quite confused. The sales pitch for programmatic acts as if it's this amazing new thing without blindness. But there's no evidence that's true and I've worked with some programmatic buyers. What am I missing?

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