Home Analysts Forrester Analyst Greene Sees Opportunity With Programmatic Buying But Not Necessarily For Brands

Forrester Analyst Greene Sees Opportunity With Programmatic Buying But Not Necessarily For Brands

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ForresterForrester Research recently published a for-purchase report titled “The State Of The Digital Media Buyer.” Authored by analyst Michael Greene with the help of his research co-horts Emily Riley, Joanna O’Connell, Jennifer Wise and James McDavid, Forrester positions the report as insights for the publisher on what the buyer is up to.

Greene discussed the report’s findings and implications for the industry.

AdExchanger.com: How are you defining “programmatic buying” today?

MG: Historically, “programmatic buying” has been largely synonymous with exchange-based buying, an environment where the buyer optimizes bid price against impressions in an auction. But with the advent of “private” exchanges and new types of publisher-side price controls, programmatic buying is beginning to expand in scope beyond the traditional auction. In this sense, programmatic buying is largely about creating workflow efficiencies through increased automation – both within and outside of auction environments.

What are the attributes of those media buyers that are being drawn to programmatic buying?

Like online advertising as a whole, direct response buyers were the first to embrace programmatic buying. Still, we’re seeing an increasing amount of branding-focused activity. Eighty-three percent of the buyers we surveyed said that they have branding goals for their campaigns. We’re seeing lots of programmatic buying activity from what I’d call brand-conscious direct response marketers, i.e. marketers optimizing to direct response goals who are sensitive to brand, especially as it relates to content-adjacency. Major auto, name-brand retailers, and even some CPGs are buying programmatically today.

Considering current momentum once again, where do you think programmatic buying will shake out a year from now?

We’re convinced that programmatic buying (both auction-based and not) will become the primary way buyers execute campaigns. The opportunities for both greater efficiency and effectiveness are simply too great given where we stand today. Will this happen in 2012? No. But over the next 5 years, I think you can expect a shift in the role of human capital at both buyers and sellers. Like in almost every other industry, as execution becomes more and more automated, people that bring strategy, creativity, and unique insight to the forefront will thrive. Publisher ad sales teams, for instance, will become smaller but much more consultative and creative.

What are the branding metrics buyers are tracking with programmatic buying?

Measuring brand is always tricky, especially in a programmatic environment where buyers expect instantaneous feedback for optimization. It’s frightening how many marketers, even brand marketers, rely on the last-click to measure success. When it comes to choosing a publisher or other media partner, our buyer survey indicates that reach to target audience is the most important metric.

Does or will programmatic buying help bring brand dollars online in your opinion?

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No. While there is no doubt that digital media is simply too difficult to buy, solving the industry’s supply-chain mess (which requires more than just programmatic buying) won’t be enough on its own. Don’t get me wrong, I’m a huge supporter of making it easier for advertisers to spend more money more easily, but focusing just on the supply-chain issue is a cop-out. The ugly truth is that the digital media industry has created an environment that’s crappy for brands. Cluttered websites, lackluster ad formats, and poor measurement practices mean that its simply too difficult for brands to deliver and confirm the emotional response they are looking for. Just look at online video: Almost every premium publisher would kill for more in-stream video ad inventory; it sells great to high-paying brand advertisers. But in many ways, buying in-stream video is even messier than buying banner ads. Still, buyers come because they know the format can deliver for brands. The online media industry needs to first figure out how to deliver a creative experience suited for brands, then it can worry about how to get them to more easily spend their money.

By John Ebbert

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