From a technology that was once considered “niche,” automated advertising has come a long way. A total of 98% of US sellers now have a well established strategy around it according to the IAB. Meanwhile, according to the IAB UK, almost half of the UK’s digital ad spend will be transacted through automation this year.
But what about the buyers? And should we still have to ask that question?
According to a recent report from Forrester and the ANA, the answer is clearly yes. The research found that less than a quarter of marketers had used the technology, and 29% had heard the term “programmatic,” but didn’t understand it.
Perhaps this is commentary on an industry keen to talk about the dizzying numbers behind the data and speed of real-time bidding, but lacking on clear and simple explanations of the benefits for buyers.
Understanding the automation of the buying and selling of advertising needn’t be like studying rocket science. Anthony Rhind, global chief digital officer at Carat has compared it aptly to an ‘operating system’ for advertising. And just as your Mac or PC has various applications, so does an automated advertising ecosystem. Just like Windows or iOS, it also crosses various screens, devices and media – from desktop to mobile, video, native and more.
And for those of you reading this and still wishing for a more basic explanation, we have Advertising Age to thank for it’s feature ‘Explain it Like I’m 8: Programmatic.’ The article offers an eight year-old’s explanation, noting that the difference between conventional media buying and automated media buying is like the difference between writing to Santa vs. ordering your present online.
While we’re on the subject of defining automation in the simplest terms, it’s worth talking through the four major trends going on in our industry. These ‘four pillars’ will add a little colour and wrap more context around the combined benefits of automation
1. Data-Driven Deals
From its humble origins in monetising unsold inventory via machine-driven auctions, automated advertising has shot up the sales funnel. And from its early use case in the performance-based media sales channel, automated advertising is now supporting brand campaigns via the Real-Time Bidding (RTB) protocol.
Two and a half years back, when we pioneered private marketplaces (facilitating 1:1 agreements between individual buyers and sellers) we saw higher quality inventory and placements come to this channel. Sellers were also able to package their audience data with these deals, resulting in higher yields and offering audience-based targeting for buyers. Buyers could also bring their own first-party data and targeting intelligence to the table.
2. High impact formats and brand spend
More recently, we have automated a variety of high impact formats, including the IAB’s Rising Star units and full-page takeovers. You only have to look to our work with Merkle in the US, or with VivaKi in Australia for some examples. In fact, from August 2013 to June 2014, we saw an eight-fold increase in the number of Rising Star-based private deals being bought and sold across Rubicon Project’s technology platform in the UK alone.
The automation of brand spend and high impact formats means lower overhead and time saved for sellers. From a buyer perspective, the benefits are the same, with the added bonus of being able to bring data to the equation. Brand campaigns that didn’t previously benefit from audience targeting now do. Automated full-page takeovers and skins can be targeted to the right audience at the right time, in many cases for the first time.
3. Cross-Media
According to the ANA, more than half of ad campaign spend will go to cross-media, or multi-screen campaigns within the next two years. Consumers are spending more time on mobile and tablet devices – and overall splitting their time between a range of different screens. For sellers, this has meant adapting to a world where the majority of their audience is coming to them via mobile devices. EMarketer recently reported that total digital time spent by UK consumers surpassed time spent watching TV for the first time this year.
Meanwhile cross-platform marketers are crying out for an ‘operating system’ to streamline workflow, manage and optimise such multi-screen campaigns. Research cited by AdWeek suggests that targeting and audience tracking are currently lacking – as many as 62% saying they ‘lacked sufficient insights’ cross-channel.
4. Automated Guaranteed
Supporting guaranteed deals for premium, direct-sold inventory is the next step in the evolution of advertising automation.
Up to this point, automation has focused largely on non-guaranteed inventory. But what if advertisers had the benefit of a ‘buy it now’ button for specific sellers, apps and audiences over specific numbers of impressions or periods of time?
Imagine the efficiency gained through automating the planning and purchase of media campaigns on a guaranteed basis, across all media and over a growing array of standard as well as high impact ad formats.
In fact, in our recent survey of nearly 400 media buyers and planners, conducted in partnership with Digiday, we found:
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Resources Wasted: Buyers today use up to a half-dozen different systems to plan and execute a media buy, often requiring manual reconciliation and driving up costs
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Inefficiencies Abound: More than half of those surveyed spend at least 20% of their time on manual processes when buying and selling digital advertising today
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Desire for Change: Nearly 9 out of 10 surveyed believe the marketplace needs a guaranteed direct order automation platform to eliminate inefficiencies, reduce costs and increase overall return on investment
These are the four pillars of advertising automation as we move forward into 2015. As we’ve seen already this year, this is a sector that changes week to week. But within that change, these are constants and challenges that will not go away.
Hopefully they help you see the combined benefit and potential of automation, similar indeed to the benefits of ordering your present online instead of writing to Santa.
Jay Stevens, general manager international at the Rubicon Project.
For more opinions:
CES takeaways from head of Telstra, OMD
The digital generation - what millennials want
The trends that will shape programmatic video in 2015