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Despite Reservations, Programmatic Buying Gains Steam

Buyers and publishers struggle to get the info and control they need out of exchanges

Programmatic buying has begun to rewrite the way digital ads are bought and sold. Through demand-side platforms and real-time bidding exchanges, marketers are purchasing ad inventory through automated technology, which can allow for real-time response to customer actions—often at a lower cost than traditional ad-buying methods. However, both publishers and media buyers still have concerns about programmatic buying.

Digiday and digital advertising technology provider OpenX surveyed media buyers and publishers in North America in February 2013 and found that 70% were already doing some programmatic trading. And 77% of those buying via programmatic means planned to do more of it in the next 12 months.

Not only are more media buyers using programmatic exchanges, but a good number are also considering moving to programmatic trading to replace their direct relationships with publishers. More than one-third of media buyers said they were at least somewhat likely to do so. And another one-third seemed willing to entertain replacing their direct relationship with publishers with programmatic buying, but they wanted to see the success of the method first. Only three out of 10 media buyers seemed certain they would not move entirely to programmatic buying.

For publishers, the concern around programmatic buying is a matter of protecting their pricing and brand image. Three-quarters of publishers surveyed said that their biggest issue with programmatic trading was controlling cost per thousand impressions (CPM) and pricing. Additionally, publishers want to protect their relationships with media buyers; maintaining a direct relationship with buyers was a concern for over two-thirds of publishers. Maintaining control over ad quality, and by extension, protecting the publisher brand itself, also ranked as a leading concern.

When asked what part of the ad-sales process could be automated, publishers ranked reviewing an ad’s quality last. Only one-quarter thought this aspect of ad sales could be automated, reiterating the importance publishers place on being able to review what goes alongside their content.

While the cheaper pricing and better targeting upside of programmatic buying may be obvious for media buyers, they too have concerns about migrating onto programmatic platforms. The greatest percentage (68%) wanted more data to inform bids. There was also significant interest in exposure to additional inventory.

In terms of what features publishers look for when choosing an ad server to use for their programmatic trading operations, yield optimization was most important to publishers, at 88%. Eight out of 10 also wanted to be able to set price floors based on which buyer or segment was making a purchase—a preference borne out of anxiety about losing pricing control.


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