According to eMarketer, nearly one-fifth of U.S. display spending will be automated in 2014. That's encouraging growth, but it's amazing that 80 percent of marketers are still spending their display budget manually. Advertisers will always make direct buys, but announcements like the Yahoo, AOL, and Microsoft pact to automate direct sales show that publishers are grabbing hold faster than most brand advertisers.
Ask brands why they're hesitant though, and you'll get a lot of excuses. Run through the trades, and you'll likely see someone talking about how digital is just too hard or their money is better spent on traditional media. The following are some marketers, analysts, and industry experts discussing why money stays in traditional media (and out of programmatic), as well as some of the flaws in their thinking.
"Nobody gets fired for buying ABC, NBC, CBS, and Fox." -- Forrester's Jim Nail
This is a sad truth that speaks to the fact that marketers don't value performance and, worst of all, they're all too happy to stay in their lane and maintain the status quo. The key to measuring successful advertising is to come up with the right metrics per campaign. It seems outlandish that new channels would be deemed risky while legacy broadcast networks carry a reputation as safe -- how is that proven? How do you directly tie conversions to TV? I've heard networks sell themselves as premium content, but what kinds of audience metrics do they use to validate the premium audience?
While you can insist that traditional broadcast is foolproof, "nobody gets fired" for raising performance with RTB/programmatic either. If anything, it's worth a test, and the impact of your programmatic digital campaign can be precisely tracked.
"The plan, Ms. Harsini said, is to give Mitsubishi a consistent presence on national TV rather than going dark for months as it has after launches in past years." -- Ad Age article, June 17, 2013
This isn't a direct quote from a marketer, but it describes Mitsubishi's antiquated strategy. The automaker has traditionally spent less after a big TV launch and will now invest more to stay top of mind. Consistent presence is important, but only if it's in front of the right audience. With the current fragmented audience/content landscape, marketers need to adapt to the new ways consumers engage with media and content. You would assume that their goal is to stay in touch with auto shoppers, not just the general public. Using automation allows brands to stay top of mind. In fact, a brand could adjust online media to coincide with big TV initiatives, while also using it to target intelligently and efficiently. There's no need to spray and pray.
"The sheer magnitude and speed of digital -- creative, timing, tech, software architecture, social, mobile, device proliferation, integration, media, experiences, and so on -- is extremely challenging to manage especially while trying to maintain organizational readiness and remaining digitally athletic." -- George Haynes, social and digital media manager, Kia Motors America
There's a lot of truth in this quote, but it doesn't make digital any less important, nor does it mean it should be de-emphasized because it is challenging. Many brands pay agencies to solve the problem for them -- and if they can't, then they probably need a new agency, the right media partner, or the right in-house marketing team. Staying up-to-date on digital ad trends is necessary to ensure successful campaigns, especially as eyeballs and media sales move toward digital. There's pressure on media planners to master new skills, adapt, and not fall into the trap of formulaic day-to-day planning or deeming something "too challenging" if it doesn't fit into pre-defined media buckets.
"eMarketer predicts that U.S. real-time programmatic buys will increase by more than 72 percent in 2013. Yet, in contrast, according to the Online Publisher's Association's Branding on Display survey of 250 marketers, 47 percent of decision makers believe premium content publishers are the best media for brand-focused advertising campaigns, compared to 16 percent preferring social media, 13 percent favoring video ad networks, and 11 percent preferring portals." -- AdExchanger article, June 24, 2013
Again, this raises the question about the definition of "premium" inventory. It's not something that an advertiser should decide. Rather, that definition comes from their consumers, whom determine which environments are the most engaging to them. The perspective above shows that advertisers still misunderstand their customers. They're using data to find consumers, but they're not using programmatic's data capabilities to understand how their consumers engage and respond.
Programmatic is growing, and it's affecting all aspects of our industry. Publishers who were steadfast against RTB/Programmatic are finally turning the tide and embracing it. It's time for brand marketers to become familiar with the role of automation. The changing media landscape, the fragmentation in content consumption habits, the increasingly on-demand audience, the reliance on centralized data -- all require solutions that are nimble, innovative, and can adapt quickly. Traditional media has always required long lead times and manual management that misses opportunities to capture the targeted consumers' attention in real-time. Fortunately, programmatic display is in a prime position to address those challenges.
Jon Schwartz is VP of sales at Netmining.
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