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New Data Signals German Advertisers Are Growing More Comfortable with Programmatic

Industry guidelines address concerns

May 22, 2017 | Advertising

Thanks to growing comfort with the concept of automated ad placement, programmatic ad spending in Germany increased by 52% in 2016 to reach €592 million ($656.8 million), according to Bundesverband Digitale Wirtschaft (BVDW), a trade group representing digital marketing companies in Germany.

Programmatic Ad Spending in Germany, 2014-2017 (millions of €, % change and % of total digital display ad spending)

That result was higher than the €577 million originally forecast by BVDW for 2016. The larger-than-predicted tally drove up programmatic advertising’s share of the year’s total digital ad spend to a new high of 33%.

BVDW expects an annual growth rate of 46% in programmatic ad spending in Germany this year, for a total of €864 million ($955.8 million). That figure is equal to 45% of all digital ad spending projected for the year. BVDW believes there’s greater comfort with programmatic advertising following the introduction of a code of conduct for programmatic last year.

“With the introduction of the code of conduct, we have succeeded in establishing uniform regulations for all market participants and setting new standards in transparency, quality and safety,” said Stefan Zarnic, chairman of BVDW’s programmatic advertising focus group. “Against this backdrop, we can assume that the market development will be similarly impressive.”

In comparison to BVDW’s figures, eMarketer estimates that programmatic digital display advertising will total $1.23 billion this year in Germany, an increase of 54% from 2016.

An eMarketer report on programmatic advertising in Germany published in September 2016 noted that publishers in the country were long wary of making large amounts of inventory available for programmatic buying. They also found that a lack of clarity, transparency and industry standards for programmatic were serving as barriers to programmatic trading among marketing decision-makers there.

“The code of conduct introduced in late 2016 has apparently succeeded in addressing many of these concerns about quality, transparency and security, and has also established rules for all participants in the programmatic marketplace,” said Karin von Abrams, eMarketer’s principal analyst for Germany and author of last year’s report.

“Though finalized only late in the year, the code will have had a major impact on market growth in 2016, because industry players knew it was in the works,” she said. “In addition, many agencies and publishers were finally facing the need to actively engage with programmatic, rather than resist it. Strong growth looks set to continue in 2017, now that this step has been taken.”

Cliff Annicelli

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