Increasingly, programmatic buying is top of mind for buyers and sellers. Every advertising industry conference has a session on it. There are even entire conferences dedicated to the topic. It has had a major impact on how publishers and buyers interact. Yet, the surprising truth is that most buyers aren’t actually sure what it is. Nonetheless, they somehow know they need it — like now.
So, what IS programmatic buying? Let’s use this general description: Programmatic buying is the process of executing media buys in an automated fashion through digital platforms such as: exchanges, trading desks, and demand-side platforms (DSPs). This method replaces the traditional use of manual RFPs, negotiations and insertion orders to purchase digital media.
But what does it really mean for the buyer and the seller?
In a similar fashion to the way SEM created a new focus for media planning on audience segmentation, ROI analysis and performance, programmatic buying is now causing a shift for buyers who are moving their spend to display and standard pre-roll. This means that the data associated with ad delivery is more important than ever and must be available in near real-time in order to make dynamic, meaningful buying decisions.
For publishers, this rapid shift in spending is forcing a new approach to advertising sales and the way in which inventory is packaged and promoted to buyers. The interesting thing is that this approach is impacting all areas of sales – traditional as well as programmatic. With that in mind, here are four tips for publisher success in this new environment:
1) Understand and Control Inventory
When considering working with an ad exchange or demand partner, like Google or 24/7 Media (WPP), it is very important that publishers take stock of their inventory to understand how it is currently priced and which inventory is currently most appealing to marketers. Inventory should be segmented into clearly defined buckets and publishers should use their ad server and other tools to ensure total control over what inventory is provided to the exchange.
2) Establish Clear Value
Publishers must ensure that when working directly with a marketer the ad packages they are providing are clearly differentiated from what can be purchased programmatically. This can be as simple as selling the non-standard display units. Even so, sellers should be thinking more like marketers and developing custom programs that take full advantage of the content, brand and voice of the publication being sold. In doing so, publishers not only are listening to clients better — providing them with real solutions to their problems — but also ensuring that the pricing models of the exchange will not undercut or devalue the premium ad products.
3) Embrace programmatic buying
Every publisher should strongly consider taking full advantage of programmatic buying. This is a very efficient sales channel and, if deployed properly, will drive new revenues from non-endemic advertisers, increase fill, and improve yield and overall revenues. Inventory made available through the exchanges should be smartly packaged and tiered with varying pricing floors to promote the best yield possible and aid in the protection of the direct sales channel. However, to get the full benefit of programmatic buying, the majority of the standard display inventory should be viewable and biddable enabling both direct and indirect buyers to compete for the inventory.
4) Quality Control
When adopting programmatic buying it is very important for publishers to be working with a partner that enables granular control over buyer quality and has creative auditing tools in place. Publishers should pay close attention to the buyers that they allow to bid on certain segments of the inventory and also use these mechanisms to ensure that there are no conflicts with the direct sales channels. Keep in mind however, that any buyer-blocking will have a direct impact on revenue and yield, so do this sparingly. As for creative auditing, an exchange partner should provide that service as well as a detailed policy for your review.
Programmatic buying is still new to many publishers. Those who have embraced it, and have taken the time to understand their inventory completely, are seeing early success. Some publishers believe so strongly in programmatic buying and its growth that in the very near future they will see the largest percentage of their ad revenues coming from the exchange which will lead to a retooling of their direct sales force.
I think about it like this: a publisher no longer needs an army of sellers to blanket the market to drive hundreds of sales. Instead they will hire a SWAT team of sellers who are consultative, think like marketers and build integrated and highly creative programs for marketers. They are true brand warriors providing solutions to marketers that are unique, breathtaking and capable of broadly differentiating them from the crowd. Publishers have many things to consider and react to these days – from changing consumer behaviour to new devices and screen sizes vying for their attention. The good news is that with a little analytical work and smart segmentation of inventory, there is a large amount of efficient revenue available to help fuel the business. This will free up some time for the sellers to sell smarter and for operations teams to deal more strategically with this ever changing landscape. What do you think?
The views expressed here reflect the views of the author alone, and do not necessarily reflect the views of 24/7 Media, its affiliates, subsidiaries or its parent company, WPP plc.
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