People have many different things to say about what programmatic means for marketers: “It’s taking over the industry. It’s a magic bullet. People will be obsolete soon.” But the reality is more complex, according to experts and recent studies.
The consensus is that programmatic is transformative. It’s steadily claiming a higher proportion of ad budgets. And it’s poised for big growth this year. Accuen, Omnicom Media Group’s agency for programmatic media, has seen more interest from clients this year, with the proportion of digital budgets going to programmatic increasing compared to last year.
Despite the rise in usage, many people might not have a firm grasp on exactly what programmatic means or may have a poor understanding of its nuances, according to a recent survey. (Programmatic refers to using software to purchase ads instead of through human negotiations.)
“Programmatic is going to be just as important to brand advertisers as it has been for direct advertisers,” Google Vice President of Display Advertising Neal Mohan said in his keynote speech during March’s Programmatic I/O conference in San Francisco. “Programmatic is really going to reinvent the way awareness- and consideration-based marketing is done.”
Here’s a look at some key numbers, according to a recent survey of 400 marketers, agencies, publishers and ad tech firms released by AdExchanger:
- Currently, the majority of marketers spend 20% or more of their budgets programmatically
- Two-thirds plan to spend double that much over the next 12 months
- A quarter of marketers project they will spend at least 80% of their budgets programmatically
“Marketers are already spending a lot on [P]rogrammatic media and expecting strong growth,” AdExchanger’s O’Connell told Forbes in an interview.
And with both the rise of video and the major networks edging toward making some inventory available programmatically (see these pieces for summaries of early moves from ABC and NBC), savvy marketers like P&G and Amex are positioning themselves to ride the wave of growth as early as possible.
Even with the meteoric growth many expect for programmatic this year, the survey also says that there’s a learning curve—16% report they don’t know what it is, while an additional 21% cite complexity as the biggest challenge.
The truly important things may never be fully automated, according to the Digiday primer: “Programmatic technology will probably mean there are fewer ad buyers in the world, but it could also allow both marketers and sellers to spend more of their time planning sophisticated, customized campaigns instead of getting bogged down in bureaucracy.”
But marketers should get ready for big changes soon, according to the AdExchanger report. That means learning now how programmatic is going to affect your clients, your business and what your team needs to know to get ready. Josh Jacobs, Global CEO of Accuen, advises, “Programmatic doesn’t have to be complicated, but it does take some legwork and coordination. With the market rapidly adapting to programmatic buying, investing time now to understand how programmatic works, who the key players are, and how it fits into the larger digital picture will pay off in the future.”