The World Federation of Advertisers (WFA) and Infectious Media have compiled a unique study into the level of local programmatic maturity around the world, breaking down 13 of the world’s biggest ad markets into four clusters depending on their sophistication.
- Programmatic first markets: US, UK, France and Australia.
- Maturing markets: Germany, Japan and Brazil.
- Mobile first markets: China, Indonesia and India.
- Emerging markets: Russia, South Africa and Malaysia.
Emerging programmatic markets, which Malaysia falls under, says the report, are not as digitised as the others included in this report. However, the economic potential of large population sizes makes markets such as these a compelling advertising opportunity. The universe of internet users in Russia, for example, is almost 80% larger than the UK (a programmatic first market), but programmatic spend per capita is a fraction of the UK’s. Suppliers in these markets are often entering programmatic from traditional trading, meaning legacy trading practices persist.
Transparency can be a problem and focused attention on scope and contracting is recommended.
To be successful in emerging markets, advertisers need to aim for a rich understanding of the nuances of each market, with a view to tailoring strategies accordingly. However, learnings from the development of more familiar markets can be used to inform the approach.
For advertisers to uncover opportunities within emerging markets, inventory sources such as messaging apps, search engines and ad networks should be investigated alongside programmatic. US messaging apps are often not available in emerging markets, so marketers need to look for the most used local or regional messaging apps that feature advertising.
Mobile first markets
Meanwhile, as more of the media landscape moves to mobile, it could be argued that most markets will end up in the mobile first bracket. But as more local media companies begin in app environments in markets such as China, Indonesia and India, they need to be considered distinct from other countries included in this study. This is not a migration to mobile, but a continued evolution in the way the device has been used by consumers and advertisers. A solid solution for capturing and reporting on device IDs in these markets is critical.
The mix of partners required by advertisers in the mobile first ecosystem tends to be different to the programmatic first category where brand safety partners, data providers and DSPs generally take a web first approach. As app usage is more far reaching than in other markets, a solid solution for capturing and reporting on device IDs is critical in the mobile first category.
- Ensure you are capturing mobile advertising IDs for first party retargeting. Investigate working with mobile data specialists for second and third party targeting strategies.
- As attention spans are shorter and loading times are limited by data usage, reduced video length assets are necessary to maximise engagement on mobile devices.
- Focus on creating native assets and non-intrusive mobile display formats like inter-scrollers for mobile web.
- An in-app attribution partner is needed to measure both brand and performance campaigns.
- For bricks and mortar brands, speak to regional location experts who can help measure online-to-offline footfall.
- Consider working with app sources or partners that have implemented the Open Measurement SDK (OMSDK) to ensure consistency of measurement across your media buys.
- In-app fraud is still very high in programmatic due to the prevalence of 3rd party supply and difficulties in measurement.
- Consider working with in-app fraud specialists and prioritise exchanges/networks that allow 3rd party fraud measurement.
- Pursue reimbursements for wasted media impressions on invalid traffic sources.
The classification is based on data from both the demand and supply sides of the ecosystem and takes into account programmatic video availability, the level of implementation of ads.txt and the volume of direct publisher to supply-side platform (SSP) relationships.
Programmatic first and maturing markets
The report identifies that programmatic first markets, such as the US, UK, France and Australia are chiefly characterised by the fact that most inventory sources are accessible programmatically, providing scaled access to premium video inventory, often in a flexible and transparent commercial model. It’s recommended that advertisers demand high viewability, fully disclosed trading and a high level of data access.
PMPs, a symptom of more sophisticated trading, represent around 40% of all inventory in programmatic first markets, around double that of emerging or mobile first markets. While PMPs may be associated with higher CPMs, they represent access to higher quality inventory and unique publisher second-party data, both of which are core areas of focus for WFA members.
In contrast to programmatic first markets, most inventory and formats in maturing markets (such as Germany, Japan and Brazil), will be available via programmatic, but access will be less automated. In these markets, factors such as legacy trading relationships and/or technological separation from the global ad tech ecosystem, have suppressed maturity. It’s recommended that advertisers consider visiting these markets to establish direct relationships with publishers.
“Media buying is, ultimately, a local business and demands a local approach. But there are considerable opportunities to consolidate and simplify this, avoiding the need for a unique programmatic stack per market. ‘Media transformation’ is the focus for many WFA members and this report supports that ambition, helping marketers to define their global programmatic strategy with local executional tactics,” said Matt Green, global media lead, WFA.
It’s become increasingly common for WFA members to develop their own tech stacks, contracting directly with Demands Side Platform partners, Data Management Platform partners, Ad Serving partners, and others. The Global Programmatic Market Maturity Report gives global marketers the insight they need to adopt a technology approach that can be underpinned by a global framework while also having scope for local adjustment.
According to WFA, these classifications are vitally important because they affect how brands should approach their digital media strategy in each type of market, the best way to access inventory, the level of transparency that’s likely be on offer and how to avoid excessive exposure to ad fraud.
“We didn’t know of any subjective programmatic maturity research based on a consistent framework across markets. So saw the opportunity to use the data from billions of auctions that take place globally to fill this gap. The resulting report has produced many surprises, even considering our good understanding of these markets through our buying for clients. This has led to important insights into how advertisers need to tailor their programmatic strategy across countries,” said Dan Larden, global partnerships director, Infectious Media.