While efficiency has been the promise of programmatic buying, many factors are holding it back. A new report by MagnaGlobal is highlighting the biggest trends in the programmatic ecosystem.
“Programmatic trading has not simplified buying and selling of digital media. Quite the opposite: there has been an exponential increase in the amount of data, devices, media formats, transaction methods and campaign goals available, which requires a corresponding increase in manpower and support services,” said a note in the report.
The programmatic process needs to streamline and simplify the report to gain traction over traditional purchase methods.
Here’s three ways the processes need to be simplified, according to researchers:
1)Reducing the number of programmatic ad tech partners, and focusing on providers that can cover multiple aspects of the programmatic service offering spectrum.
2)Using comprehensive targeting methods that allow an all-inclusive approach to impression selection as opposed to leveraging multiple and separate data sets for different functions, media and devices.
3)Prioritising services that can bridge a greater number of formats and devices, in preparation for programmatic TV.
“We also expect more of a barbell structure to the ad tech landscape in years to come, with expansion of multi-service conglomerates on one end and a proliferation of small new service startups on the other. The middle of the spectrum – large companies with limited scope – will flounder,” predicts the report.
“The days of a dominant single-service offering ad tech company are in the past,” it added.
The report has detailed players in the programmatic ecosystem globally – major programmatic tech hubs, exchanges, DSPs and SSPs, and all the ancillary services that accompany programmatic campaigns – and the services these offer.
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Programmatic TV: Will it really take off?
Programmatic ecosystem participants are focusing on ways in which digital and programmatic TV efforts can be managed through the same platforms, and compared apples-to-apples. These comparisons include cross-screen reach and frequency management, cross-device planning, targeting & measurement, universal frequency caps, measuring digital in terms of GRP, and TV in terms of CPM, among others, said the report.
“However programmatic TV will remain far below that of digital even five years from now due to several advantages that digital had during its growth phase,” said MagnaGlobal researchers, listing these five reasons:
1)Search advertising was already 100% RTB and provided a blueprint for the magnitude of potential RTB efficiencies, justifying aggressive ad spend .
2)Digital tech infrastructure was already set up for individual impression delivery and a 1:1 user:publisher experience. Much of TV is linear in nature and not receptive to dynamic insertion .
3)Digital advertising had far fewer incumbent purchase methods and long-term deals compared to TV .
4)TV suffers from the same headwinds that exist in digital video: there is far less unsold inventory than exists in banner display and social, and therefore less incentive for media owners to transition to a new transaction method Because of these differences, it is safe to assume that programmatic TV will not penetrate the TV market at the pace that was seen in digital, but even these lower penetration levels result in significant spend.
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