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Bill SwansonCountry Manager, UKPubMatic
PubMatic’s recent Ad Revenue Europe 2014 event was given the tagline “Programmatic, the New Normal.” And with programmatic trading set to account for a substantial proportion of display advertising in the UK in the coming years, it’s a tagline that carries some weight. PubMatic’s Bill Swanson spoke with eMarketer’s Bill Fisher about how, once issues of transparency and the move to mobile are overcome, programmatic trading will become the norm.
eMarketer: Programmatic has seen substantial growth in the UK in the past year or so. Why do you think we’re seeing such huge gains?
Bill Swanson: At the end of the day, budgets are moving. Also, technology is continuing to improve, providing efficiencies that people are looking for in the marketplace, both from the supply and the demand side.
If you have an efficient marketplace and money is spent more wisely, as a publisher, you basically want that audience to be bought as often and at as high a price as possible. Programmatic allows for that as a technology, but the benefit really goes to the publisher because they’re getting the high yield, which the technology is driving. On the demand side, they’re seeing that that is getting a better response rate for them.
Programmatic is just becoming a larger slice of the pie. In 2017, 83% of digital ad spend will be programmatic—at the moment it’s about 30%. There’s been a huge amount of growth already, and there will be a huge amount of growth over the next three years.
eMarketer: What do you think are some of the main obstacles to the take-up of programmatic trading?
Swanson: There’s an internal mind shift in terms of how they [publishers] need to adapt. There’s also concern that moving to programmatic will have an impact on direct deals they’re doing, which it doesn’t. They’re different pots of money. The main thing really is trying to find the right people, and consistently we speak to publishers who get that programmatic is something they absolutely need to be in the game for, but it’s finding the right people who can help them to play in that game.
eMarketer: Could one other obstacle be that programmatic is potentially seen as a partial loss of control, or at least it’s an extra element between the seller and the buyer side?
Swanson: Yes, there is a concern, but from a PubMatic perspective, we try and give as much control and transparency to the publisher. If they get a better understanding in terms of who’s buying what and when, at what prices, or who’s not buying and why they’re not buying, it gives them more control and power, so they can further develop their programmatic and even their content strategies based on what the market is doing.
But there’s an awful lot of data there, and it’s a question of how you manipulate that data and what questions you’re asking of that data. We’re consistently trying to make it as easily navigable as possible. For example, PubMatic is just launching a whole new reporting based on asking simple questions of your reporting tool to allow publishers to get simple results back, rather than just a standard user interface.
We’ve done that to make sure that the publishers can get full visibility and access to the billions of data points that are out there and being created on a daily basis. So, it’s always good to have data, but if you’re not doing the right stuff with that data, then it can be confusing.
eMarketer: How do you think mobile fits into the whole programmatic equation and why do you think it’s increasing so quickly?
Swanson: Everybody’s getting better and faster smartphones, which people are spending more and more time on, and if we consider simple supply and demand, the demand side is always looking for where the audience is. If the audience is spending more of its time on mobile, then that’s where budgets will shift.
A lot of our clients—large publishers—have been working in the programmatic space for three or four years. They’re fairly comfortable with what they’re doing on the desktop space, but then lots of the audience is now moving to mobile. You can’t have as many ad formats on mobile—screens aren’t the same size, they’re different eCPMs [effective cost per thousand impressions] and they have different requirements. So the money is shifting over to mobile, because that’s where the audience is, but it’s going to take a bit of time for the right ad formats to be developed.
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