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techmap: Is Programmatic the Future of Advertising?

What a great evening! We found out all the answers at our first techmap event.

A common agreement among our speakers from last night was that ‘we all need educating when it comes to programmatic’. It was suggested a lack of education, combined with an urgency to break into the programmatic space, is creating a whirlwind of confusion.

Andy Bush Senior Vice President of Time Inc

Andy kicked off the evening’s chatter by stating programmatic is not rocket science. Only two things are needed when it comes down to programmatic:

1. a publisher

2. a client.

Andy used a simple definition: ‘programmatic refers to delivering a set unit at a set price’. 

With this in mind, a key question when considering programmatic should be considered:

“what are we delivering in programmatic form so the end user has a great experience?”

So many people are trying to make money from programmatic, but are not understanding the experience for the end user or how to go about creating it. Again, creating unnecessary confusion around the subject area.

Andy went on to explain how Time Inc has moved beyond just digital and into print programmatic; enabling advertisers, initially in the US, to target the most highly desired segments in the digital marketplace in print too.

Jack Rutter Platform Director at TubeMogul

Jack contended that programmatic is going to play a massive part in the future of advertising. Whether it be through TubeMogul’s software, or anybody else such as Google or MediaMath and so on. The fact that software enables the central planning, management and reporting of advertising campaigns across multiple formats means that programmatic is here to stay.

Jack explained that ever since the evolution of the internet, a programmatic approach made sense. Search was the first to utilise software to automate the buying of key words with demand or auction based pricing. After that came display and in it’s initial guise it looked like programmatic was more aligned with DR (direct response) than branding.

Jack referred to Marc Andreessen and how he once famously said that “software is eating the world”. If we reflect on the changes in the way that business is done and how we live our lives now versus 25 years ago he is right. In the UK programmatic across digital is beginning to mature and in the near future we will start to see programmatic buying software being utilised to buy and sell TV spots, Outdoor bill boards and even on daily press ads.

Gawain Owen Digital Lead at Nestle UK & Ireland

Gawain started by referring to when Nestle were approached about a product called Xaxis, offering programmatic trading. He explains how the product works a bit like a washing machine; you put something in, spin it around and it comes out the other side with a bit of targeting to it. From then onwards he set himself the task to go into the market to really understand how programmatic works.

Gawain suggests programmatic trading really isn’t that difficult to get to grips with. He goes onto explain inventory as ‘the ad available’ and ‘the ability to target the consumer through data; with data you can target very precisely where you want to get to’. We now understand through data that people who want to buy a Nestle Nespresso machine go on more websites than just the four which serve a whole range of websites so we now use both adverse party and third party data.

Gawain reveals that Nestle spend about 30% of its money in digital adverting, of which a significant amount goes into programmatic trading. Nestle currently collaborates with 3 different types of companies, including agency trade desks (audience on demand), specialist trade desks (programmatic companies) and search agencies; whilst identifying the pros and cons of each one of them.

Demand side, Nestle currently work with TubeMogul and Google. The company also looks at data management platforms to identify how data can be aggravated across all mediums. Ultimately, no brand can grow its market share if its advertising is not being seen – thus buying and analysing inventory for verification purposes is paramount in today’s digital world.

Stephane Lecuyot Digital Acquisition Manager at Nestle Nespresso

Stephane discusses how programmatic is still very new; but that the key thing is to get transparency and efficiency and to move away from that very rigid and fixed media plan towards a more flexible media plan.

He goes on to explain how the company used to buy display and negotiate with publishers; this was then booked for 3 months. Within these 3 months there was no room for optimisation from the data which was received. But now with programmatic we can optimise, we have full transparency and for us that’s the key thing – its really cost-efficient in showing banners with the right message.

During the Q&A session, a series of questions posed to the panelist were, “what surprised you the most about programmatic, which one piece of advice and learning material, should we as the audience take away with us tonight?”

The answers included:

Jack Rutter: Biggest surprise was the level of talk about fraud in the dirty parts of programmatic; publishers who don’t have an inventory, buy-in from somewhere else, which feeds into the dirty parts of the industry.

Andy Bush: “The one piece of advice I would give would be to read, absorb & consume everything; embed yourself into programmatic because it is the future of buying.”

Gawain Owen: Learning material – work with smart agencies and people. Source the people who you can see have their head well and truly screwed on in the programmatic scene. People talking to people means that everyone is on the programmatic journey together.

Stephane Lecuyot: My advice? Check everything.

What a great evening. We hope you left with a better understanding of programmatic advertising, or buying, and some ideas you can apply to your own business, agency, or marketing plan.