Programmatic Is Not A Strategy

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seideman"Data Driven Thinking" is written by members of the media community and contains fresh ideas on the digital revolution in media.

Today's column is written by Jay Seideman, US director of the targeting and exchange team at Microsoft.

Programmatic has been never simple. But back in 2010, programmatic only meant one thing: the auctioning off of display impressions, also known as real-time bidding (RTB).

Today programmatic is a loaded term that can mean widely different things. As media sellers, programmatic must be treated like a Russian nesting doll. Sellers need to ask the right questions to peel back the unimportant layers and dig into the marketer need that is underneath it all.

Buyers, on the other hand, need to be more upfront with stating their marketing goals, as opposed to just asking for programmatic offerings because it’s the hot new marketing term.

Underneath the term “programmatic,” there is an advertiser objective that is being met. What actually becomes programmatic, then, is a byproduct of that strategy to meet the advertiser’s goal. In the end, buyers and sellers shouldn’t be fooled by conflated programmatic with strategy. Programmatic is about the execution of media, or how media is bought and sold. That, in and of itself, is not a strategy.

“In a way, current state today puts the act of programmatic center stage, which is sort of like saying my strategy for building a deck is that I’m using a hammer and wood,” Andrew Casale, vice president of strategy at Casale Media, told me recently.

My co-worker, Esco Strong, points out that there are three primary objectives underneath programmatic requests. I want to dive into each of these:

  1. Data Strategy
  2. Workflow Advantages
  3. Buying Efficiency

Data Strategy

Data is the fuel that powers good marketing, and buyers are getting smarter about leveraging it. Today this goes well beyond browser cookies, and includes online and offline data across multiple devices. The marketer’s goal is to be efficient with their outbound messaging, to both current and prospective consumers. Why would an auto marketer send someone who just bought their expensive SUV another advertisement for the same model? Inasmuch, if a marketer wants to execute their data strategy across your property, the seller needs to understand the type of data the advertiser wants to leverage – both yours and theirs – before even considering how it can be executed. These conversations may lead to a programmatic solution, but they also may point to another media execution.

Workflow Advantages

These conversations most likely will lead to a programmatic execution, but it’s important to leverage the right one. The simplest scenario is a marketer’s goal to manage a single (global) frequency cap with consumers, to avoid oversaturation. This cannot be achieved by historical buying from multiple vendors, without the use of programmatic workflow.

With traditional media buying, friction also exists around areas such as manually processing insertion orders and sending tracking tags to each vendor, where there is a lot of room for error. Some buyers strive for unified reporting, analysis and billing. Others are looking for quicker media execution. For some of the reasons already stated, video buying from a single platform has become popular. Sellers need to unwrap which problem the marketer is trying to solve, and then determine which type of programmatic solutions properly addresses it.

Buying Efficiencies

Many buyers look for advantages and pricing efficiencies across media properties. While it is a popular motivation, this isn’t just the race to the bottom (the other RTB) that hinges on price. Some marketers want an advantage against their competitors, which could be a first look at impressions, a priority in ad serving or auction or more granular use of publisher’s data. Publishers need to work with buyers to figure out what programmatic levers should be used to solve for this need.

“Programmatic is the how,” said Maureen Little, senior vice president of business and corporate development at Turn. “It’s not the what, which is the brand’s messaging and creative strategy across publisher content. Nor is it the why, which might be consumer branding, acquisition, engagement and upsell.”

As buyers and sellers, we often times jump into the programmatic discussion too soon. In doing so, we start with the media execution, rather than the marketing strategy. In actuality, our conversations need to cover everything that builds up to this.

As sellers, it is our job to unstack the nesting dolls with the right questions. As buyers, don’t get intoxicated with the raw power of programmatic. Instead, work hard to state your objectives and strategies first. When approaching media planning appropriately and thoughtfully, both buyers and sellers can avoid getting distracted by the mere execution of media, and find real solutions with programmatic underpinnings or elsewhere.

Follow Jay Seideman (@JaySeideman) and AdExchanger (@adexchanger) on Twitter.

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