The Programmatic I/O Cheat Sheet

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The Programmatic I:O Cheat SheetCouldn’t make it to the AdExchanger’s Programmatic IO event last week? No worries, I took some notes. Here are some of the most interesting takeaways from a bunch of geeky folks focused on advertising technology:

AdBlocking – probably THE hot-button topic for programmatic in 2015:

  • The Issue: Adoption of AdBlocking is growing across all demographics and is estimated to cost $10.7 B in 2015 to advertisers and publishers.
  • Why is Ad Blocking growing?
    • User Experience: invasive ad formats annoy consumers and also degrade the user experience.
    • Speed: heavy loads slow down consumers’ desktop and mobile browsers.
    • Cost: data costs related to advertising on a mobile phone can cost a consumer up to $10/month in data.
  • AdBlocking is getting easier for consumers, especially with simple app downloads for mobile. It’s being fanned by Apple who supports an app environment that isn’t supported by ads (especially 3rd party ads and apps).
  • This erodes the “tacit agreement” between publishers and consumers: publishers provide “free” content, and users “pay” for through exposure to advertising. Publishers must fight back:
    • Major publishers like Washington Post and Axel Springer are blocking content to consumers if they use ad blockers.
    • May also foment the rise of paywalls.
  • Solution: TBD, but “new” the solution will need to be driven by an improvement in the consumer experience. Online advertising must positively complement their experience and-and not cost them money/data.

Brands Taking Programmatic In-House (Zipcar)

  • Why: Control, Transparency, Insights, Efficiencies
  • Zipcar has pulled its programmatic efforts in-house. In actuality, they are still outsourcing the majority of the data management and media execution to Accordant Media. However, they have greater transparency and control than they had previously.

Programmatic Meets Creativity: Beyond DCO

  • Can programmatic ads fulfill the basic advertising creative goal of effective and engaging storytelling?
    • Where Programmatic Ads can excel: delivering the ad with the right message, right person, right time.
    • Creative Versioning: 3-5 types of creative for 3-5 exclusive segments (although one DCO example yielded over 100K ad variations, of which 12.5K were used in a live campaign).
    • How do you “tell a story” in a short period of time? This medium challenges the normal advertising storytelling, especially with display and/or native ads (video/TV spots are 30 seconds or more); agencies are learning and evolving along with the medium.
  • The Holy Grail: effective 1:1 creative that matches and optimizes to the individual user across all digital mediums (including addressable TV in the future).

Fulfilling Programmatic’s Promise 

  • Issues: Fraud, Viewability, Arbitrage, Blocking
  • All due to lack of visibility into the programmatic exchange market
  • Perspective on the Mammoth size and complexity of the Programmatic ecosystem:
    • Wall Street: 4B trades per day
    • Programmatic Advertising: 400B daily trades, with 10X times more data involved in each trade

Agency Trading Desk (ATD) Client Relationship (JCPenney and Accuen)

  • Transparency: showing and understanding all the client costs including media, ad serving, 3rd party verification, and platform fees
  • Internal Education for brands to teach their teams (including procurement) is critical; making it simple so they an understand the impact on marketing/advertising and overall revenue

A new Buzzword:  

  • Header Bidding (aka pre-bidding): provides the ability for multiple buyers (exchanges) to get a first look at a publisher’s inventory before that inventory is pushed into the Publisher’s ad server.  Essentially, it’s an algorithm that enables the buyer(s) to cherry pick the inventory that they want to secure.  Typically this helps to raise prices for publishers.

Andrew is a seasoned digital media entrepreneur focused on building scalable businesses in the Front Range. Drawing from his 15 years of digital media experience, Andrew recently co-founded Choozle, the leading self-serve programmatic media platform. With its platform powering agencies and media sellers around the world, Choozle is a high-growth venture backed enterprise with 20 employees. Andrew holds a BA in Economics from Vanderbilt and an MBA from UCLA’s Anderson School of Business.