Despite the ad industry is experiencing challenging times due to COVID-19, the previous growth in programmatic advertising brought up a lot of essential questions like regulation, transparency, cookie-less future, and ethics issues in the spotlight. Programmatic is encompassing new digital channels including wearables, interactive TV networks, and even in-car advertising. Here are key insights for you to be on the cutting edge of digital advertising.
#1 Market giants taking media buying in-house
A greater number of companies are shifting towards in-house marketing to make their promotional campaigns more accountable, productive, cost-efficient, and relevant to their brands. According to IAB’s survey, 86% of brand leaders in France, Germany, Italy, Spain, and the UK, including P&G, Unilever, Netflix, and Paypal have fully or partially shifted to the in-house programmatic advertising.
Going in-house, however, is a long and complicated process that takes much investment in technology development and talent recruitment. Brands need to look for a team with a strong technical background, potentially from ad tech companies able to cope with fraud, frequency capping, and attribution issues. Broadly speaking, it takes 12-18 months to set up an internal solution.
This is why the vast majority of brands will hardly ever move all their advertising in-house. We’re going to see more companies partnering with DSPs for implementing their programmatic campaigns.
#2 Lack of qualified programmatic talents
In-housing and the emergence of hybrid models, where some elements of programmatic activities are handled in-house and others remain with the agency, have boosted demand on programmatic talents. Brands require commercial-savvy professionals with advanced data science knowledge and analytical approach to creating performance-enhancing algorithms like supply-path optimization.
In the era of Google and Amazon poaching talents with big paychecks, recruiting and retaining in-house programmatic teams can be costly and challenging. Marek Lacina, a senior display manager at Kayak, tells in her interview to AdExchanger that it took almost a year for them to find the right people and optimize team and channels for their in-house programmatic buying capability.
One of the possible ways to address the recruiting challenges is to provide internal learning opportunities and help the current staff acquire new skills.
Media buyers need to reassure the data they’re using for their marketing purposes is reliable and being collected with consent. With these new regulations on board, advertisers should stay away from audience targeting and allocate their programmatic spend for contextual targeting or direct deals with publishers.
This February, IAB has introduced their Project Rearc. This initiative is aimed to unite digital advertisers and media supply chains and educate them on how to work in the cookie-less future.
#4 A digital avatar of OOH is under challenge
Marketers heralded 2020 to be a critical turning point for brands to embrace DOOH. Advertisers saw the most potential in integrating DOOH with the mobile location data to drive more conversions in the offline world by layering a device ID with OOH locations. Evolving COVID-19 pandemic, however, can drastically decrease out-of-home ad spending all over the world as more people choose to stay at home. So now DOOH future is under challenge.
If you’re interested in exploring more ways of promotions, check out an article outlining the new media entering programmatic advertising.
#5 TV, podcasts, and audio are gaining popularity
A PwC reports that programmatic TV will generate about one-third of global TV ad revenue by 2021. Yet, public behaviors are changing and we can’t say the precise numbers for now.
TV ad spendings will, definitely, rise impacted by social distancing and isolation measures. Although the VOD market is already taken by big brands as Virgin Media, BBC, Channel 4, and Channel 5, new addressable advertising platforms like Planet V are competing for their spot.
Programmatic in podcast and audio advertising is gaining traction as well. The IAB annual Report shows that podcast advertising will bring $863.4 million in revenue in 2020. Apple and Spotify are already exploring opportunities for programmatic ads on their audio platforms. Pandora even opened its audio inventory for programmatic buying in the July of 2018. Yet, the programmatic audio industry is still developing because most popular ad servers and ad exchanges were originally designed for display.
#6 Wearables augmenting programmatic advertising
Obeying GDPR and CCPA regulations, the data collected from wearables with user consent opens up ample opportunities for marketers. Brands are now able to optimize their promotion campaigns and reach their customers at the most appropriate moment. For instance, Amtrak is running banner ads on Golfshot users’ Sony or Samsung watches using Golfshot, the FitAd’s golf GPS app.
#7 Blockchain and Ads.txt are on the guard
Increasing transparency is one of the pressing issues in programmatic advertising. More security solutions are being developed to prevent unauthorized reselling of ad inventory. Among others, AdEx and Brave have created exchange platforms for ads on Blockchain that
help verify the legitimacy of publishers, avoid unnecessary middlemen, and stop domain spoofing.
Beyond verifying publishers, marketers should pay special attention to brand safety. The priority is on evaluating context and content relevance to select inventory that better aligns with the brand and to avoid an unwanted image in media.
Have you stepped your game up?
Now the entire industry needs to adapt to the new COVID-19 reality, shift their marketing direction, and develop a revival plan for their programmatic media buying. The major trends like brand safety and video on demand advertisements will continue to dominate the market. All we need for now is to keep an eye on social behavior waves and tailor our ad strategies proactively.