Wayne Blodwell, Client Digital Partner at Universal McCann, 'Programmatic Buying – It needs to be split in two'

Wayne is a Client Digital Partner at UM International, working across all digital channels within the EMEA region for a variety of clients within differing industry verticals.
It has been really interesting to see such a high volume of words penned for the ‘brand buying coming into the programmatic buying space’ argument of late. An area of such high-interest for marketers, buyers and vendors, and where everyone ‘in the know’ knows it is an area that needs addressing.
It’s important to understand that there are a significantly greater number of brand marketers and creative bods within the Media Industry than performance media heroes (my guess would be 10x as many). Many reading this article will think that is the legacy of the ‘Mad Men’ era of advertising, however these guys are just as applicable today as they were in the 50s, yet the ecosystem they sit within has significantly changed.
I feel sorry for brand marketers. The ecosystem is markedly different, and you only have to look as far as the agency groups with trading desks. Agency staff are plugging away with their trading desk offering without really understanding the brand’s history, ethos, audience, objectives and the vertical that they sit within — but the brand marketer has some over-enthusiastic trading desk operator utter the words, “We operate across 1,000s of websites and can target banners to audiences that look like your existing audience and we buy this in a real-time auction to ensure that this the media is bought efficiently.” Does the brand marketer really care? The brand marketer gets what programmatic buying is, they just don’t want to do it — who can blame them?
I want to focus on one very simple point for this article which I think will help bring programmatic buying to the fore for brand marketers: The programmatic side of the Display industry needs to be split in TWO. Programmatic Branding and Programmatic Performance.
Currently, both sides exist within the majority of media agencies (often planners are required to work on both), but they certainly are not separated in the trading desk arms of the holding groups, or within the technology vendors (for the most part). These are the people who can unlock the Programmatic Branding opportunity within the space.
The main reason I believe that the two should exist separately of each other is quite simple: they both need to be executed in completely different ways, to be measured in completely different ways and to fulfil completely different business objectives. To provide a real-life use case: those of you based in the UK, and are X Factor viewers, (may not be many of you!) would know that the 8.30pm and 8.45pm ITV ad breaks this weekend saw the launch of the new John Lewis campaign. If you didn’t see it, you may have seen it fill up your Twitter and Facebook newsfeeds, as it generated a lot of buzz.
This is what brand advertising is; it’s about users viewing emotive advertising to make them feel a certain way about a brand and then taking to social media or word of mouth to discuss their feelings.
John Lewis shift product online, but they generate significantly more revenue from their high street shops. They take to TV advertising to get into the living room of a household and generate awareness/favourability and intent to purchase the products within their high street shops. Can a digital campaign really generate footfall within a John Lewis shop? We can match the reach/frequency of TV easily online, but can the advertising format match a TV ad (its not ALL about GRPs online — there are considerably more formats than a TV spot)?
If we really want to bring the big brands of the world into the programmatic buying space (lots of the big brands don’t actually sell products online) then they need to feel like there is a really good reason for them to be there, not to be clumped alongside performance advertisers and bought/optimised on the same objectives.
In essence, the separation of branding and performance needs to be far more conclusive across all sides of the programmatic ecosystem:
– Advertisers need to be more conclusive with their campaign objectives.
– Agencies need to significantly improve their planning to achieve better/more relevant objectives.
– Publishers need to package their ‘premium’ inventory, data and content separately away from the performance advertisers.
– Trading desks need to adapt their strategies and personnel to understand and achieve different goals.
– Brand measurement solutions need to be improved.
I also wanted to pass comment within this article on the comScore white paper entitled ‘The Economics of Online Advertising’ as it was certainly interesting, but it bypassed anything to do with client objectives. There has always been a misalignment of the objectives of buyers and sellers within digital media; buyers are tasked with buying the inventory at the lowest price possible, particularly for performance campaigns (this is often how business is won and lost – inherited from TV-buying) and this obviously isn’t in the seller’s interest as they make less ROI on their ad space. What happens? More and more adverts are added to the page in low-viewability positions to offset this loss in ROI. However if performance clients can get this to work for their campaigns, then why change it? The way performance campaigns are executed is not going to change any time soon (it would have happened two years ago if it was going to).
How about publishers start to get remunerated through programmatic branding because they are selling all their ads on the same page to that one advertiser in highly-visible positions (user takeover), or the brand advertiser can purchase user-initiated expandable units on a CPM model, or the advertiser can purchase some exclusive relevant data, or even the holy grail – the advertiser can target an ad on a premium publishers website, mobile app and TV station. All of this creates exciting brand experiences for a user (I should caveat that the creative that is executed is equally important as the media buy for branding campaigns) which is ultimately what ‘programmatic branding’ should be about.
One of the major stumbling blocks we have with the theory of ‘programmatic branding’ is actually with the publishers themselves. Publishers have been on the wrong end of the race to the bottom for too long, but they haven’t helped themselves. Direct buys on premium pages can see placements bought for £10 CPM, yet these placements can be bought for £2 CPM in a real-time auction. It’s no wonder you hear buyers say, “Let’s not buy directly; let’s wait to see how much availability we can get through the exchanges.”
Publishers need to stop farming out their premium just so they sell out. Publishers need to create the scarcity of their premium ads and the demand will follow, particularly through ‘programmatic branding’. I would love to see a premium publisher openly say that any of their unsold ads would be shared out between their existing advertisers as added value. This is short term loss, but in my opinion would create long term gain.
Let’s split the programmatic space into two. It’s how we can move it forward.