Everyone is talking about programmatic buying and selling as the future of advertising – online at least – but is it? Vumani Ncube explains from a media agency perspective.
The concept of programmatic buying needs to be demystified. In its simplest form, it is automated media buying where, once the target market and budgets are input into a central console, it will automatically buy online media space accordingly. It’s about efficiency and relevancy – those are the two most important ideas to bear in mind when thinking about programmatic buying.
Traditionally, media may be bought by a planner seeking rates, and making a booking with the publisher or media owner directly. With programmatic, we plug budgets into a central console and buy advertising space on digital media sites at scale. By that I mean that we have literally millions of websites available to us through the exchanges with which we deal. Google Ad Exchange is just one example. By buying space this way we get access to many more websites than we’d normally have access to. So, we are able to cherry-pick our preferred sites and even blacklist certain sites we don’t want to see again.
Before panic sets in, it must be said that human beings are not being replaced by robots or computers. The fundamentals of a campaign’s big idea, the strategies, objectives, insights that need to be applied, and budgets and target markets that need to be defined, are all processes run by people and will continue to be so.
Another big misconception about programmatic is that it is the same as Real Time Bidding (RTB). That’s not the case at all – in fact RTB is just one aspect of programmatic. RTB means that we bid in real time on the right impression, to target the right person, at the right price at the right time. This is also where real-time market prices come into play. You can bid on an impression based on your target market – if the tech platform believes that it’s the most valuable to the advertiser, that’s what will be bought.
RTB was borne out of a publisher’s need to monetise remnant inventory. In other words, all the ad space that is less popular because a lot of it is found ‘below the fold’ – the point at which you physically need to scroll down to view more of a webpage.
Programmatic is essentially artificial intelligence married with big data. The ‘machine’ also learns as it goes. During this buying process, many things take place in the background, and over time the system gets to know an individual’s online profile and will develop suggested banners that are based on their demographic and marry that with the advertiser’s target market and objectives. For example, it might send the mother of a toddler an ad for nappies.
These profile templates become very cost effective to agencies and clients. Another example is if a consumer is browsing Vodacom’s website and halfway through signing up to a deal, he or she decides to visit an unrelated web page. While on that site, an ad could appear on his or her screen saying, “If you still want the Samsung Galaxy S6 Edge, go and buy it in the next 30 minutes and get one free gig of data a month on your contract.”
The way programmatic buying is done on an automated platform provides us with huge scale. If one person had to try and replicate what programmatic does, they would find it takes them more man hours than is reasonably possible. Try booking ad space on 100 websites manually – it’s not going to happen. But programmatically, it can be done in in minutes, and accurately.
From a marketing perspective, the challenge with programmatic is that many marketers are reluctant to try something new. It can be difficult to persuade someone that ‘new’ can be better. For some, the notion of programmatic is a bit like learning an entire new language – it’s daunting.
Conversely our overseas counterparts have already had some time dealing with programmatic and have been able to iron out any concerns and kinks. As an agency, our main strength is having an already established, trusting relationship with clients, and that forms the foundation for new experiences. But as with anything new, the proof is in the pudding: programmatic becomes the hero when clients receive meaningful results.
Programmatic buying provides a lot of detail about one’s customer. Thankfully, most of our clients are behind the concept even though there is still a big disparity between agency know-how and marketer’s adoption. Having said that, we’re also seeing a shift of agency people going over to the client side and taking their expertise with them. This is advantageous in that they know how effective programmatic can be and this move will play a large role in convincing other marketers that it’s the right way to go.
Currently we only have programmatic for digital platforms. Other media types such as television, radio, out of home and activations will come on board in the long term. I do believe, however, that once the move from terrestrial to digital TV broadcasting takes place, TV will come on board too. Streaming audio facilities like Deezer and Spotify will also start adopting programmatic once the shift from FM to digital takes place. Once that becomes available, there will be a merging of skill sets in that ‘digital’ planners who may not know too much about TV will become specialists in that field and vice versa as new platforms come on board.
In the past, digital has always been an add-on to a media plan and, while there’s still a lot of work to do in consolidating skill sets to create a complementary media plan, a unified media approach will give clients more bang for their buck. And whatever’s best for the client will be implemented.
Programmatic is the new kid on the block and eventually all media will affect one another in some form or another. The bottom line is that digital produces incremental reach much faster, and is much cheaper, than any other media type. It’s time to climb aboard!
Vumani Ncube is head of performance at Lighthouse Digital, part of the Starcom MediaVest Group. Ncube specialises in paid search and programmatic media buying.
