Commentary

Study Suggests Reallocating 6% of Marketing Spend to Programmatic Will Increase Marketing ROI 22%

by Richard Whitman , Columnist, December 4, 2016

Ad network Rubicon is out with a new study which found marketers that increase their programmatic spend can realize up to a 6 percent increase in sales and a 22 percent increase in marketing ROI. The study was conducted in partnership with The Female Quotient Strategy and took a look at $20 billion in spending by the top 200 U.S. brands. Each of the brands spends over $100 million.

Of the findings, Rubicon Chief Revenue Officer Harry Patz said, “This study of some of the largest brands in the world very clearly showcases that advertisers who are underinvested in programmatic will miss out on significant revenue opportunities. By reallocating advertising budgets to double investment in programmatic, our data shows that brands will see a significant uptick in increased sales and marketing ROI, compared to those who do not.”

The study suggests the increase in programmatic spend can come from a reallocation of overall marketing funds rather than a net increase allocated to programmatic. It's further suggested that the increase in programmatic spend come from a 1 percent decrease in spend in radio, print and digital and 3 percent from TV for a total spending shift of 6 percent resulting in an optimum 10% of total media spend.

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3 comments about "Study Suggests Reallocating 6% of Marketing Spend to Programmatic Will Increase Marketing ROI 22%".

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Ed Papazian from Media Dynamics, December 5, 2016 at 9:22 a.m.
When a "study" like this starts "suggesting" that avdertisers drop TV (-3% ), radio, print and digital ( -1% each) to fund what appears to be a new digital medium called "programmatic" and this will greatly omprove their ROI, one must ask how, exactly, was this magical result determined?
Reply

Michael Hubbard from Media Two Interactive, December 5, 2016 at 11:18 a.m.

Programmatic is not a channel, it is a method of buying - specifically it is the automation of buying. So how can one allocate from a channel to a method - unless, if what you are saying is that your traditional methods of buying the media directly should now be moved to an automated method? In which case - why not move the full budget to an automated process if the results were so promising? What were the drawbacks of the automation? People continue to not understand what "programmatic" is, rather, they just continue to throw out buzz words.

hank cohen from windstarmedia.com, December 5, 2016 at 12:10 p.m.

Michael, you are spot on with your comments