With programmatic buying gaining huge traction in the marketplace over the past two years, many marketers are taking the practice in house because of concerns about transparency and fraud, according to a new study from the Association of National Advertisers and Forrester.
The survey found that the number of marketers using programmatic ad buying has exploded since a previous survey in 2014, with 79% of respondents saying they have made programmatic buys in the past year — more than twice as many as in the 2014 survey (35 percent).
At the same time, 31% of respondents said they have expanded their in-house capabilities to manage programmatic ad buying. In addition, marketers indicated they have taken other steps in response to transparency concerns including:
• Requested detailed campaign guidelines and reporting from agency partners (62%)
• Aggressively updated so-called “blacklists” (51%)
• Targeted “whitelists” (45%)
• Purchased inventory through private marketplaces that media companies have created (42%)
• Added language in insertion orders to increase transparency (40%).
Respondents to both the new survey and the one conducted two years ago indicated that the leading benefits of programmatic buying were better targeting and real-time optimization.
However, despite the significant growth, respondents to the new survey indicated that they still consider digital ad fraud and a lack of transparency in programmatic ad buying to be serious obstacles to the effective use of programmatic advertising.
Almost 70% of respondents cited higher bot fraud in programmatic buys as a concern. At the same time, varying numbers of respondents said a lack of transparency regarding the costs associated within the programmatic supply chain, a lack of inventory and data transparency, and a dearth of information about whether an agency reaps financial gains from the media seller by using the client’s funds all posed challenges to the overall programmatic experience.
“While programmatic buying indeed offers benefits, it suffers from complexity and a lack of transparency,” said Bob Liodice, president and CEO of the ANA. “And that is wasteful. The industry — and marketers in particular — would greatly benefit from a rethink of the entire digital supply chain.”
The ANA and American Association of Advertising Agencies have been at odds over how to deal with transparency issues. Last year the groups had agreed to jointly come up with a set of guidelines. But earlier this year they found they couldn’t come to agreement on specifics and the 4As announced a set of principles that the ANA strongly objected to.
Meanwhile full details of the new ANA study will be presented later this week by Forrester’s Jim Nail at the ANA’s Masters of Media Conference in Hollywood, FL.
The survey was conducted in February 2016 and included responses from 128 ANA members.