Programmatic buying is still just a sliver of the total online ad spend, here and around the world (in New Zealand, it accounted for nine percent or $3 million of the total $31.4 million spent on online display in the last quarter). But it's getting plenty of column inches and that spend is trending upwards. Most of the big media players have invested in or have access to trading desks and demand side platforms, and many ads for local brands now feature on international sites as a result. But Acquire Online's Anthony Ord is aiming to get those clients and agencies to support local publishers a bit more by creating a list of 156 different Kiwi sites that have offered inventory as part of a network buy.
Ord, who was media director for around three years at FCB Auckland back in 2007, says he's found a pretty good niche by offering smaller independent agencies the option of managed programmatic buying for their clients. He says many of these small shops don't have the resources to employ someone one with trading desk nous and the big display networks also often have minimum spend limits, which precludes many of them from playing in that sandpit. So that's where he comes in through the seven-strong Acquire Online, which is part of Digilowcost and has access to over 130,000 local and international sites.
- Check out Ad Age'snine things to know about programmatic buying for a good rundown on what it all means.
He says the team have been flat-tack and, while the number of agencies on board varies depending on how many campaigns are in market, he says it's had 13 at its height and has ten at present.
In an opinion piece that originally ran in NZ Marketing, iProspect's Alex Radford talked about Google's dominance of the digital ecosystem and his desire to find a way where clients and their agencies could support local publishers.
"What I am suggesting is that agencies, advertisers and local publishers start talking more, with the simple goal of helping local publishers develop advertising solutions that ultimately keeps more money here in New Zealand, rather than ending up in a black hole somewhere in Ireland."
Now Ord says that's a realistic goal with his local list.
So do Kiwi clients care? Or do they just want the most exposure for the least cost?
"They definitely care. We all want to support New Zealand publishers, as long as it doesn't affect campaign performance. There wouldn't be a client in the country that wouldn't see a benefit in that."
He uses the analogy of the birds on the rhino's back to show that business is a symbiotic relationship. And while it doesn't all have to be 100 percent New Zealand sites, he says clients or agencies are able to set a limit and might decide to spend, for example, 20 percent of the campaign budget on the local sites.
He says all the big publishers are onboard, although the amount of inventory being put up for grabs varies as some of the premium publishers can get much higher CPM when they sell their space direct. But publishers tend to try and have their cake and eat it too, and often allocate inventory to display networks to help increase revenue.
As programmatic buying increases in popularity, many advertisers don't seem particularly concerned about where their ads run and, as this story shows, the adtech revolution means they're often buying audiences cheaply rather than premium space with established or venerable media brands. Context is sometimes important, but not always. Clients don't advertise in the first ad break on One News because their spot is aligned to the content, they do it because it has a massive audience. And while there has been a lot of talk about fraud in the online advertising realm recently, Ord says there's been very little proof the criminal underworld is rorting the system. In some cases, the money has been proven to be flowing to the wrong places and the Interactive Advertising Bureau in the US has been doing all it can to deal with sophisticated scams involving non-human traffic that some believe are stealing billions from advertisers.
In addition to blacklisting sites on networks when complaints are made about their legitimacy (he says it has placed billions of ads and it's only had one complaint about a site so far) or dodginess (porn is excluded from the networks, but "FHM-style" sites are included), he says a smart way to ensure the ads are working is to rely on conversions. A bot can't fill out a form and ask for a test drive (yet). And while he admits it's going to be a battle of technology between good and evil when there's this much money at stake, Google is doing its bit to ensure quality, companies like Integral Adscience are ranking networked sites with products like True Advertising Quality, and bot detection is getting a lot better (he says very high click-through rates are often a giveaway).
"They just need to measure success by performance," he says.
So will the machines take over? As Ad Age reported, MagnaGlobal has pledged to automate 50 percent of its clients' media buying by 2016 and American Express sent a letter to its adtech partners saying it wanted 100 percent of its online display budget to be spent programmatically. But as Dynamo's Kate Thomas wrote a few months back, programmatic is a bit like having HAL 9000 buying your media for you, although with no morbid consequences.
"HAL was a programmatic system designed for quick decision-making. Basically, HAL makes targeting the right people at the right time with the right message (the fundamentals of media planning since year dot) more accurate and much easier to execute across the fragmented, long tail of media. HAL will handle a lot of paperwork, too. However, whereas HAL 9000 could gauge and interpret emotional behaviours (and even appreciate art), programmatic buying is a long way off this ... Programmatic buying is simply an executional tool and we must remember this. It will not define strategy, it will not unearth a ground-breaking emotional insight, but merely use automated tactics to deliver on the parameters we set."
Ord agrees and says while elements of the process are automated, it's still a highly manual field and "you need someone looking at every campaign, every day".