Is programmatic advertising all it's cracked up to be?

Programmatic advertising burst onto the scene promising more efficient and data-driven digital campaigns, but has it lived up to that promise? We investigate


Tweaking creative

One area of investment for many brands and agencies is in using data to not just better target audiences, but to tweak the creative message to actually achieve a better response from those audiences. This has created an opportunity for the people-based creative optimization and data activation platform, Sizmek.

“You don’t get personalisation by just being able to target audiences,” says Sizmek’s general manager for EMEA, Andrew Bloom. “You get personalisation by being able to deliver differentiated messages and stories to people as you touch them on their journey. And that is the promise of marrying optimised creative to an optimised audience.”

The integration of creative processes is finding favour across the board, and plays well for integrated agencies such as integrated Melbourne-based player, Spinach Advertising.

“As a media agency, you can do a certain amount of optimisation,” says Spinach’s general manager and media director, Ben Willee. “But if you don’t have the opportunity to sit down with a creative person and say what’s happening, you can’t get the real benefits.

“The impact of creative is three to four times the impact of media optimisation on campaign results. That is where we think the really exciting game is.”

This in turn, has altered the creative process in the agency, due to the ability to use programmatic to rapidly test alterations to the campaign creative.

“There was a time when a creative director was a god in an agency and the arbiter of what was good and what wasn’t,” Willee says. “Well not necessarily any more – now we can say, ‘let’s test that’.

“The problem we are finding is we get a bit excited and want to test too much.”

But as long as an agency is planning, buying and executing programmatic campaigns on behalf of clients, there will always be a question of the margin it can charge for doing so.

This question, and the desire for some advertisers to maintain greater control over the process, has seen many brands decide to take their programmatic activity back in-house, including the Australian operations of technology maker, Lenovo, which has opted for TubeMogul as its technology supplier.

“It is the best decision that I have ever made,” says Lenovo’s head of digital and social, Danielle Uskovic. “Back then, agencies didn’t really want to tell you everything that was going on. So when I bought it in-house, what I was really surprised by was how willing publishers were to give you a lot more inventory, a lot more bonuses, access to first-party data, access to events, native pieces, and creating your own pages on their sites.

“It was just amazing to me that all of this stuff you could get, instead of just a simple ad buy. You don’t know what you don’t know until you actually go and do something like this.”

Uskovic is adamant any brand’s success today relies on the technology it uses, and this definitely has to be owned by the brand, not the agency.

“Because the agencies for too long have profited from owning the data and on-selling it, and using it across multiple customers,” she says. “From a brand’s perspective, these are the things we should be owning, and having that full transparency.”

Challenging the agency status quo

Statements such as these have forced a rethink from the agencies in terms of how they price and communicate their activities. In May for instance, Havas Media announced it has delivered a fully-transparent client-facing programmatic solution, dubbed Client Trading Solution (CTS), which it described as a ‘client facing, fully transparent control tower displaying all programmatic trading, allowing clients to track and monitor their programmatic buying in one place’.

Spinach chose to buy its own tool – a universal data hub from Tealium – delivering the ability to identify individuals, match those individuals to their devices, and then match that device and individual to behaviour.

“We estimate in the digital space it will save 30 percent where you’ve got waste age of crossover across device and across channel,” Willee says.

At OMD, Betts says his agency has always been clear with its clients about how much it charges to manage activity.

“Our clients can come to us and look at how much money we have spent programmatically though the channels of video and social and mobile and display, and they understand exactly how much has gone to the media partner and exactly who much has gone to any technology partners required to run that advertising, and exactly what they have paid us to run that advertising for them,” Betts says.

As a result, Betts sees both McDonalds’ and OMD’s overall spending through programmatic continuing to increase. The agency is starting to buy TV in a programmatic way of targeting audiences, rather than just buying inventory on an age and gender basis or picking spots in programs

“There will always be some of it that is more integration or idea-led – that will require that people-based piece,” Betts says. “But we are working on a brand that has 1.5 million customer every day. For any of our advertising – digital or traditional – to have an impact on their business, it has to be seen by millions of people.

“And so we require opportunities that enable us to buy our advertising in that way.”

Follow CMO on Twitter: @CMOAustralia, take part in the CMO conversation on LinkedIn: CMO ANZ, join us on Facebook: https://www.facebook.com/CMOAustralia, or check us out on Google+:google.com/+CmoAu

 

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