programmatic buying


DO THE MATHS


PAUL LEE, partner, Keystone Strategy, Microsoſt, gives some technical tips: The more scale that you have within your platform, the beter the programmatic ads will be. This is because the platform requires user feedback with the content and ads shown. An example of ‘scale’ is that a publisher with ten independent brands can integrate the ad platform so that they have the full volume of the ten brands to provide feedback to the machine learning systems. If they don’t combine the ad platform, then, on average, each brand will have 1/10th


the learning


of the combined system. What we’ve seen in practice is that increasing the total number of users, total number of advertisers, greater user diversity and advertiser diversity, and then combining with the total number of pages viewed, that the improvement to machine learning algorithms is exponential. This is the dynamic that gives more fuel for a skilled sales force to provide beter ROI for advertisers.


about is bringing processes up to-date, rather than replacing them with machines. Removing the need for outdated, error- prone tools, multiple pairs of hands, repetitive tasks and significant overheads and inefficiencies is what it’s all about: ad automation helps publishers by taking on those time-draining, money-wasting tasks and freeing staff to focus on higher value, creative commercial partnerships.


what challenges does programmatic present to media owners?


JAY STEVENS GM, international, Rubicon Project


how is programmatic advertising helping media owners? Real-time bidding is just the first instance of advertising automation – technology automating the expensive and time- consuming processes that surround the buying and selling of all advertising. Unfortunately, for what is still a relatively


new space, there is a lot of confusing jargon floating around (not to mention multiple terms for the same thing). What it all boils down to is this: just as editorial teams have already undergone a process of becoming ‘digital first’ in terms of the digital tools and workflows they use, sales teams are now catching up to make themselves just as efficient and productive. That is where the ‘automation’ bit comes


in – moving us from trading through the pre-internet fax and Excel to cloud-based, API-driven tools. What we’re really talking


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As with all relatively new technologies, there are a lot of myths perpetrated by those who fear change, or just don’t understand what’s at stake. In actual fact, the problems described above (loss of control etc.) all appeared as a result of the rise of the ad network – and real-time bidding emerged as a solution to solve them. When real-time bidding emerged on the scene, it offered publishers granular controls around which advertiser brands they would allow to run, and at what prices. In addition, buying and selling was made transparent, where the ad networks were not, allowing buyers to know exactly where their ads were serving, and which advertisers media owners were running.


is programmatic destroying the ethos of selling a brand?


Ad automation helps publishers by taking on those time-draining, money-wasting tasks and freeing staff to focus on higher value, creative commercial partnerships


This question brings us neatly onto the next stage in ad automations’ evolution. Following the emergence of real-time bidding as an open auction, the technology has evolved to enable private marketplaces. Private marketplaces are deals agreed directly between a seller and buyer, and executed digitally instead of through fax/ Excel. Private marketplaces favoured premium publishers, gaining higher yields for them as agencies were prepared to strike prioritised deals for their inventory. But the continued importance of publisher


brands within this space doesn’t end there. Despite reports to the contrary, face-to- face contact and knowing the right agency contacts are still as important as ever. At Rubicon Project we run a series of global events, called Marketplace Summits, with the express purpose of


introducing publishers to the right buyers, and selling their brands directly to them.


how has programmatic evolved recently?


The importance of premium brands and the yields publishers are able to command have only grown further since the emergence in the past year of the latest iteration in ad automation – audience-based private marketplaces. Through the use of data management


platforms (DMP) or other in-house solutions, publishers are selling not just select placements on their sites, but offering targeting down to specific user groups (socio-demographic or purchase intent, for example). Add to this the emergence of an increasing number of rich media, takeovers, roadblocks and other non- standard high impact ad formats to be traded through real-time bidding and private marketplaces, where before it was only the standard IAB banner sizes. Finally, the next evolutionary step, which businesses like The Guardian are already taking, is for publishers to become buyers as well as sellers. By setting up what the industry is calling ‘publisher trading desks’, these forward-looking media owners are selling their audiences and user groups across both their own properties, as well as other sites. The publisher trading desk represents a completely new revenue stream for forward-thinking, data-driven sellers – not least magazine publishers, who often have high value, highly engaged audiences, and sell out across their own inventory – and are therefore well- placed to take advantage of this trend.


will programmatic become a permanent part of publishing?


It already is. You only have to look at ad agency IPG’s latest forecast - that more than 50 per cent of advertising will be automated by 2017. As the more advanced publishers in a range of international markets put increasing headcount and resources behind this area, 2014 looks like being the year when those who don’t get on board will be left behind.


issue 81_2014 | Magazine World |27


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