Heading for the future
2015 marked the tipping point for Programatic buying – specifically for CPG brands. We’re now seeing near daily announcements of brand budget reassignment and investment in programmatic platforms. Clorox Co.’s recent statement that the company will triple its digital ad budget is merely one in a series of similar statements from major brands like American Express and Proctor and Gamble who have already invested heavily in the digital automation. Programmatic has blossomed into a lead rich garden on the outskirts of paid and display. It’s no longer a question of IF but WHEN will major advertisers make the shift. Most direct response (aka performance-based advertisers) are already spending big budget on programmatic to access highly targeted, efficient distribution and gather in-depth data analytics; as exquisitely outlined earlier this month in a blog post by, Make It Rain, marketing director, Mike Fantis.
The big questions among advertisers is which is better? Executing their programmatic media campaigns in-house or using agency trading desks and programmatic networks? We’ve worked with a number of brands and as with many things digital – it can be a complicated answer. Long term commitment, resources and talent play a vital role in successful performance whichever way you go. It’s not as easy as one being better than the other. Below I’ve outlined a few pros and cons that encountered along both routes:
If it’s DIY (in-house), the brand becomes the advertiser and has full control from the media planning through execution and analytics management. There’s full transparency where as a managed services model brands grant control to agency partner trading desks or programmatic network/s. Utilizing the managed services model, brands have almost no visibility into the day to day running of their campaigns until the scheduled reports get delivered to them.
If brands don’t utilize the services of agency trading desks or programmatic networks, they have to ensure and invest in guaranteeing that they have the expertise and knowledge to execute the entire buy in-house via a team of programmatic traders. Many brands don’t have the resources and niche expertise required for internal management. Engaging agency partners in strategy and programmatic execution by agency trading desks or programmatic network allows brands to benefit from the up-to-the-minute subject matter expertise of media planners that may produce better value through leveraged learnings and insights from a breadth of campaign executions.
More and more advertisers have begun to adopt a hybrid model in which they execute all of the frontend pricing negotiations and media planning then let their agencies execute the buy through the agency trading desks or a programmatic ad exchange. Some advertisers feel that this hybrid structure ensures agency transparency. This arrangement allows agency trading desks to negotiate on the brand’s behalf while allowing the client to maintain full visibility of the media planning and buying process. Agency trading desks or programmatic exchangers execute the setup, optimization and management since that’s their expertise.
In conclusion, it’s clear there is no catch all answer on which is best. It depends on the amount of control and in-house investment an advertiser or client wants to take on. One thing is clear, No matter which option an advertiser chooses, programmatic media will play a valuable role in their digital marketing as the market accelerates. The best next step for a brand advertiser, schedule a meeting with a media planner or digital strategy agency to talk though the specific needs of their brand.
Contact DAC today to find out more!