Programmatic buying: The challenges and opportunities

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Programmatic media buying is now generating a huge surge in interest from advertisers and their agencies. Marketing dollars are being increasingly shifted to this form of buying, and with seemingly good reason -- it allows us to be exponentially more efficient in our selection and pricing of ad impressions.
 
Combining this with the data and analytics tools -- built in as "apps" to most of the top DSPs -- improves the ability to segment audiences, evaluates responder profiles and interests, and communicates more effectively with customers at every level of the conversion funnel.

Since programmatic media buying is such a hot subject right now, here are some of the key issues surrounding it.

Machines are not taking over

A concern that many people share is that algorithmic media buying eliminates the need for the human element. If the campaigns are being optimized automatically, then do we need as many humans to manage them? The answer is yes, but you may need a different type of human.

The task is changing from negotiating and buying media placements, to analyzing and manipulating data. Experts are predicting an increase in demand for data scientists.

In addition, programmatic media buying is meant to be a part of the overall buying strategy, not the whole. Media buyers are still needed to execute direct buys and custom placements. With the abundance of data tools we are also getting better insights into our audiences that media buyers are using to identify premium and sponsorship buys.

Transparency

One of the concerns for agencies and advertisers is that there are still too many "black box" traffic sources out there. This is due to a combination of SSP and DSP ad networks not wanting to disclose what they consider proprietary information, as well as publishers wanting to stay anonymous.

The challenge for marketers in these situations is that they miss out on the value of being able to identify the sources and/or the consumer segments that are performing (or not), and apply that knowledge to their broader marketing effort.

Vendors themselves are increasingly calling for more transparency from the programmatic industry as a whole. We should see increasing visibility become more available to marketers in the near future.

 

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