US Insights

Programmatic users behaving badly

Elizabeth Wilner

US Editor

Digital 02.19.2016 / 14:55

Big Data Key Middle

Insights from TNS, Xaxis and Kantar Media on what marketers still have to learn about the hottest tool in digital advertising

Google’s Matt Brittin once likened programmatic to teenage sex, and it’s easy to understand why. Everyone seems to be worrying about whether the competition is doing more of it, or doing it better than they are. The truth, though, is that worryingly few people know what they are doing at all.

Are brands risking their own future by blindly taking the plunge? Are they missing the real opportunity? And is there a more informed way to plan out a strategy for programmatic

We asked TNS’s Digital Director Jonathan Sinton; Caspar Schlickum, CEO of programmatic ad platform Xaxis; and Dina Srinivasan, managing director of emerging media at Kantar Media to cut through the confusion and offer some insights on what brands should – and should not – be doing to take advantage of programmatic.  

Q: What are the pitfalls for marketers in using programmatic?

Caspar Schlickum (CS): To be honest, I think the biggest opportunity for programmatic is also its biggest challenge. Programmatic is really nothing more than using an algorithm to make a decision about whether to place an ad or not. It can make marketing data actionable and executable, but only if you can organize your data to enable it to do that. Marketers need to understand that the challenge really starts there: organizing data and getting access to the right data within their own organization.

Dina Srinivasan (DS): Exactly. Programmatic just means using an algorithm to allow computers to make decisions in real-time – decisions around when to serve an ad, and to whom. Sometimes, brands are trigger-happy to use programmatic advertising. It’s the new shiny car model. However, algorithmic decisions often over-complicate and over-simplify human behavior.

Jonathan Sinton (JS): Programmatic is the executional end of a strategy, but that strategy has got to be right. If behavioral targeting or re-targeting are your only programmatic strategies, then you’ve got a problem. Marketers need to think more broadly about who the target is and how they’re going to target that audience effectively with the right message. It should be used throughout the funnel, not just at the end.

Q: Do marketers know what they’re doing yet?

CS: Lots of people aren’t getting it right yet. But in a way, that’s understandable. Reinventing approvals processes, being able to access data in different silos, that’s all going to take awhile for clients to figure out. People are still trying to invent business models, and a lot of the backwards integration hasn’t happened yet. If programmatic were a sporting event, we’d still be at the stage where the players are arriving at the venue; it’s very, very early days.

Q: Are marketers undermining brands by spending on programmatic before they’ve figured out the right approach?

CS: Yes. Well, to be honest, I think programmatic is at risk of undermining itself. It’s important to draw a distinction here between programmatic done well and programmatic done badly. There are lots of examples where programmatic is done in a very irresponsible way right now: re-targeting, cookie bombing, not applying proper frequency caps. All of that stuff causes huge amounts of annoyance to consumers, the end users. It’s not fair to say we are spending too much. The question is: are we spending it on programmatic in the right ways?

Marketers should be challenging the partners they work with, whether that’s media agencies or third parties, not just about the results but about how those results are achieved. Are they real results, and are we sure we’ve delivered those ads in a way that hasn’t annoyed our end users and consumers, and hasn’t damaged the brand?

DS: I think so. Sometimes, we need to revert to common sense. Let’s take a personal example. A bunch of brands (unnamed) tried to be smart with programmatic advertising in December. I’d shop for something, put it in my cart, and then buy it. Then I’d get targeted with ads for the same products. My kids would then see all the ads and notifications. They ruined the concept of Santa Claus in my house! Is this smart algorithmic advertising? Or is this behavior harming long-term brand equity? Customers complete purchases, and this is what they get in return?  

Q: Do brands need a more imaginative approach to the data behind programmatic?

CS: This is going to make the real difference between brands. You see some brands who are many years down the path with data strategy and creating their own data profiles, and then others who haven’t really started to think about it yet. The ability to have your own unique data to integrate into programmatic is going to give you a real secret sauce and a critical competitive advantage.

JS: What’s actually going to differentiate a brand in this world of data? That’s where you need the secret sauce that Caspar talks about: a way that you’re using your own data to help you target people better than your competitors, and it’s going to make integration really important. I think you’ll find big advertisers insisting more and more on the ability to combine data from the likes of Google or Facebook with their own data in order to target people better.

Q: Is programmatic about more than just display ads?

JS: What’s really hot right now is obviously “moment marketing”: making sure you’re reaching the right person at the right time and on the right platform. Now with something like social, it’s not scalable to have a team of people sitting there responding to every tweet about your brand – so using programmatic to deliver around social moments is going to become more and more common. There are organizations out there doing that already. If you can plan effectively around how people express themselves in different social moments, then you can absolutely target people through programmatic.

 

 

 

Source: Kantar Media, Kantar TNS

Editor's Notes

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