Why First Price Auction's Time Has Come, Magna's Take

In light of Google Ad Manager's shift to a "unified first price auction" model for programmatic media-buying, we are republishing the findings of the Spring 2018 "Programmatic Report" from IPG Mediabrands' Magna unit, which does an excellent job of explaining the evolution of programmatic auctions, and why "first …

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3 comments about "Why First Price Auction's Time Has Come, Magna's Take".
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  1. Jack Wakshlag from Media Strategy, Research & Analytics, March 7, 2019 at 10:11 a.m.

    Astounding to read a report stating that 60-70% of spend is on tech and only 30-40% on the actual media. Add in fraud and everything else and your really seem to be wasting a lot of money. 

  2. Joe Mandese from MediaPost Inc. replied, March 7, 2019 at 11:15 a.m.

    Interesting POV, Jack, that it's a waste of money. The marketplace only supports it if it works, and much of the programmatic marketplace is based on explicit ROI models, not indirect ones like GRPs and CPMs.

    Also, traditional media allocate a lot to technology, data, proof-of-performance, etc., but we just don't normally look at it that way.

    Not sure what makes programmatic digital that different in terms of a lot of money being wasted.

    Both are used only if they work and both could improve their margins of efficiency.

  3. Jack Wakshlag from Media Strategy, Research & Analytics replied, March 7, 2019 at 12:24 p.m.

    Easy to tell if it works for online products. Not so much for anything else. When you target most likely customers you often see good ROI, but that’s not the same as maximizing profit. If ROI is that great, advertiser should be spending even more. 

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