Programmatic trading: what are people saying about it? What are Match’s views?
With recent opinion pieces and the hype for the last 6-12 months, we want to give the Match point of view on the contentious topic in the digital trading space.
– Is programmatic trading going to change the way we trade all digital media? …and then eventually all other media channels?
– Is it just an ad network in disguise as an agency trading desk?
– How safe is the inventory in a DSP, is it all remnant inventory, do I know where I will appear?
– Is there a lower CPM by buying through a DSP and what are the true benefits?
– How good is the data that you can buy from different data providers?
– What do all the acronyms stand for?
These are just a few questions that are constantly bandied around, whilst we won’t answer them all now, we will give you our opinion on the current state of the marketplace.
We have watched the market place over the past 24 months and saw its ups and downs. We believe over the next 12 months, programmatic trading will flourish. More technology providers have arrived in Australia that allow advertisers and publishers to trade effectively and efficiently. The data management platforms have arrived that enhance the way we capture and utilise data in a more advanced way, allowing us to make better data driven planning choices. More local and premium publishers have come on board and have plugged their inventory into ad exchanges (some public, some private), whereby before the majority of inventory were overseas sites with AU IP targeting. Finally, the market in general is smarter and taking previous learnings forward in terms of programmatic trading.
Programmatic trading is using technology to buy (Demand Side Platform) and sell (Supply Side Platform) display inventory. We use data to increase advertising effectiveness and maths to improve campaign results.
Match’s current position on exchange buying through DSPs
We have utilised DSPs through managed services in the video space to get better access to inventory, transparency on our buys and cost efficiencies for our clients. We operated the same way through IOs with set CPMs (DSP managed service team kept the margin on the inventory they bought and sold to us at agreed rate). Unlike with ad networks, we get full transparency on sites, placement and CPM costs. This has proved highly successful whereby our clients saw the benefits of using a DSP, typically saving 30-40% on CPM for the same inventory by using this tactic.
Match’s current position on agency trading desks
We made conscious decision to sit back to allow the marketplace to mature whilst seeing our counterparts roll out their global trading desks and their race to the bottom approach to operate as ad networks. Without pressure from holding companies, we operated in a way that is best for our clients, not the bottom line. As AdNews recently reported, some agencies have been accused of using programmatic trading for their own benefits rather than for the true value of what it represented to their clients.
Where do we see the value in this space?
- Through data
- There were insufficient local data and the 3rd party data vendors (e.g. Bluekai) were not large enough.
- The real value and game changer is mining BIG data – advertiser’s own data to target against. We are now seeing the emergence of more robust data management platforms (DMPs) being built locally that can be plugged into agency trading desks.
- The Big 4 publishers are rumoured to come together to utilise their 1st party and remnant inventory to make a marketplace. This could provide opportunities never seen before and a real competitor to Google.
- Through transparency of sites and costs
- Being able to decide what site we want to buy an impression on at the right time.
- Being transparent with the cost for that impression via a bid based model.
- Costs are rising in this space but being able to buy cookies/inventory in real-time to the audience we want to target, is still a far more cost-efficient.
- Value through Control
- Programmatic trading facilitates quicker transaction times.
- Be able control start and end of campaigns when we want.
- Ability to conduct ongoing A/B and multi-variant testing efficiently.
- Value through verification of where and how the ad was served
- Match are testing different brand safety and ad verification platforms and seeing big discrepancies. As an industry and MFA Interactive Committee member, we are working with IAB Australia for guidelines.
- This allows advantages in our direct publisher negotiations through leveraging in-view impressions.
What is our strategy moving forward?
With the emergence of more DMPs, brand safety and ad verification tools coming into market, Match are currently in the throes of sending out an RFP to all DSP/DMP vendors with a view to developing a full end to end strategy for this space resulting in our own agency trading desk platform.
Our model will however be one built of full transparent margins, tailored and discussed with each of our clients.
If you would like to understand any more information on this subject please get in touch