Why It’s So Hard To Determine Success In This Rapidly Evolving Programmatic Landscape

willdohertysellsiderThe Sell Sider” is a column written by the sell side of the digital media community.

Today’s column is written by Will Doherty, VP of business development at Index Exchange.

The digital advertising industry is rapidly reaching a maturation point, particularly in programmatic. The widespread development of native advertising and even the much-talked-about promise of programmatic TV is a direct result of the industry’s innovation and technical developments.

Collectively, however, the industry suffers from the inability to clearly define or agree on what constitutes its own creations. How can we determine what success means if we can’t even clearly define the tools that we are using?

Take native advertising for example, one of the most overused terms in the industry. Successful native advertising requires a brand to seamlessly integrate their content with a publication’s own editorial. Being able to deliver great creative that has the look and feel of its destination bridges into the category of dynamic creative. It’s important to note that through a programmatic lens, native advertising doesn’t mean the same thing as brand integration.

But what some label as native is misleading. Under a programmatic rubric, native advertising remains an inconsistent and broad generalization. This only facilitates the growth of the type of clickbait, attention-grabbing headlines and faux content that cater to the lowest common denominator. This is not a tactic that delivers a high return on advertising spend for the brand, or something that strategically aligns with the publication’s own content guidelines.

If native advertising is so broadly misunderstood and defined, how can marketers accurately judge its effectiveness or create guidelines for successful native ad creative development? There is a basic philosophical exercise that poses the question, “How do you know a chair is a chair?” A chair is more than just something to sit on, an object with four legs or a piece of furniture. There is no general definition of a chair, so we point to other chairs to serve as a model of what one is or is not. We should do the same for native advertising.

We know that effective and high-quality native advertising seamlessly integrates with editorial content, both in form and function. Native advertising should not disrupt the user experience, as an outstream video ad may do, for example. Instead, successful native advertising must act in concert with editorial so it is contextually relevant and the disruption of user experience is all but eliminated.

A reoccurring theme in ad tech has been the hockey stick growth of a product offering, followed by the jargonization of terminology until it’s next to impossible to determine what is hype and what is reality. Suddenly verbiage will become popular, and anything tangential to that format or offering gets included under the umbrella term.

Programmatic TV is potentially heading down that path. TV as we know it is no longer linear, and both the viewing experience and engagement with a program moves fluidly across multiple platforms. The traditional concept of programming and distribution of television has changed, so instead of retroactively fitting programmatic into television, we need to fit television into programmatic. That is how powerful programmatic is proving to be.

Programmatic is no longer an esoteric concept. Programmatic advertising is a core feature of how a publication runs a successful and profitable business, and it is a preferred method for brands and marketers seeking to buy advertising inventory. The industry has reached a point where it isn’t making a pivot every six months. Publishers need to make a hard call with the direction of their advertising offerings. They must ask themselves: When was the last time this industry delivered a serious reinvention of consumer targeting or ad delivery?

The industry is at the point where publishers can take full advantage of a mature advertising environment, blend their programmatic and direct strategies and reap the benefits of both.

Many publishers are already seeing strong results by adopting a data-driven cross-channel approach to blended advertising. By valuing programmatic as a core source of sales, they’re able to understand how and why advertisers place value on specific inventory and audiences, and price them accordingly. That means higher, more accurate prices for any given item of inventory, regardless of the sales channel. And that’s good news for the industry.

There’s no reason to continue putting lipstick on a pig. Methodologies in programmatic have matured and stabilized over the years. We’re almost at a point where we are moving past the hype and jargon, so we can really talk about what is going to drive revenue and yield for publishers while helping advertisers meet their campaign goals.

Follow Index Exchange (@indexexchange) and AdExchanger (@adexchanger) on Twitter.

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