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5 Key Takeaways from Digiday Programmatic Marketing Summit

By: Dallas McLaughlin–Director of Paid Media

The Digiday Programmatic Marketing Summit was held in Austin, Texas in early May. This summit provided a venue for senior leaders from top agencies and advertising technology partners to hold candid discussions on the biggest issues facing the programmatic media buying industry. These discussions allow marketers to come away smarter about ad technology and feeling empowered to solve around the rapidly changing state of our client’s business needs.

Digiday Conference–Austin, Texas

The summit ran the gamut of trends, opportunities and new technology, including topics around transparency, data control, and the threat of client in-housing dominated the discussions. Here are our five key takeaways from the summit.

Programmatic Transparency is Still a Challenge—But Why?

Clients are demanding a deeper level of reporting from their agency partners at an increasing rate. Agencies, in turn, are passing these requests on to their selected media and technology partners. What results is a game of telephone between client and media partner with the agency as the intermediary. This creates what we refer to as an information bottleneck. In other words, clients are looking for information, media partners are reluctant to provide it, and the agencies are often caught in the middle.

However, this bottleneck isn’t a result of programmatic technology—which has received most of the blame—it’s a people problem. Agencies that set clear expectations with their media partners at the beginning of any engagement can ensure full transparency, visibility, and access to their client’s data, eliminating these information bottlenecks. Agencies that are willing to step up and closely collaborate and communicate with their media partners will be able to combat this growing issue of transparency into reporting.

True Programmatic Supply Chain Optimization is a Struggle

With the immense amount of targeting and optimization technology available to programmatic buyers comes what is being referred to behind closed doors as the “ad tech tax.” The catch here is that buyers are purchasing media on a CPM (cost per thousand impressions) basis, obfuscating the true cost of various forms of programmatic technology.

Want ad fraud protection? That fee gets added to the CPM. Ads.txt verification? Viewability requirements? Third-party data targeting? Pre-bid technology? They’re all baked in and hidden within the CPM fee.

These are great to have, some are must-haves, but over time these fees can add up and cannibalize a campaigns working media dollars. It’s very difficult for a client to get their arms around exactly how much working media is lost to fees. This is due in large part because the DSPs (demand-side platform) and SSPs (supply-side platform) make it very difficult for the agencies to see these fees as well.

To drive deeper client investment into the programmatic space, DSPs and SSPs must be willing to give their agency partners and clients easier access into fees versus working media. This will not only build trust among all partners, it will allow the agencies and clients alike to evaluate and optimize their buys based off of actual data. Optimizing off of actual data will lead to stronger performance, leading to deeper investment.

Digiday Conference–Austin, Texas

Programmatic Experience & Expertise Is Hard to Come By

As programmatic technology advances at an ever accelerating rate, brands and agencies are struggling to find talent capable of keeping pace. In any given week, dozens of industry changes are coming down, new technologies are being introduced while others are being consolidated. The ground is shifting underneath programmatic teams, so to speak, and a lot of what we think we know is in a state of constant evolution.

As this rate of change accelerates, clients are leaning more and more on their agencies to find and retain top-level talent. Talent that is capable of tactically executing their campaigns while also having the business acumen to communicate these changes back to the client in a way that effectively communicates how the changes will impact their larger organizational objectives.

Clients are often in the dark regarding the technology-driven underpinnings of their programmatic buys. Having a technically experienced, articulate group of traders is rare, but necessary for agencies to remain competitive and stave off the ever-looming threat of in-housing. Agencies must have an eye on attracting, cultivating, and empowering talented programmatic talent to remain competitive as this industry continues to evolve.

The In-Housing Trend is About More Than Cost Savings

Speaking of in-housing, it’s often viewed by the brand doing the in-housing as a cost-saving measure. The truth is it’s a multi-pronged issue, or multi-headed beast depending on how you look at it. In-housing also comes up when clients aren’t seeing the strategic value from their agency partners leaving them to ask, “Well, why don’t we just do it ourselves?” We also hear it when clients are feeling that the agencies don’t get their brand or higher-level business needs. 

Another big reason brands look to in-house is to gain control and ownership of their data. For too long programmatic agency partners have operated in a black box cutting off client access and visibility into performance, optimizations, and costs.

The truth is, brands aren’t wrong. For agencies to continue to thrive and act as a true partner, they must be willing to adapt to their clients' needs rather than taking a position of, “this is how it’s always been done.” The programmatic teams who are first to put the client at the center of their operations, from onboarding, to management all the way through billing, will be the teams that avoid in-housing and continue to show their value as a true partner to the client.

Digiday Conference–Austin, Texas

Agencies and Partners are Being Forced to Adapt

What’s lost in all of this is the fact that programmatic ad buying is relatively new. We’ve been advertising in the print medium since the beginning of time. Radio for 70 years, TV for 50, online for 20. But true programmatic ad buying? Roughly ten years, even shorter if you consider how long it’s been widely utilized by brands big and small alike.

The programmatic ad buying landscape is evolving every single day. Agencies, DSPs, SSPs, are all playing a big game of telephone. The clients are standing by waiting for someone to take the reins and build a truly client/brand-centric programmatic ad buying experience. Until someone steps up to lead that charge, clients are going to continue to take the reins of their programmatic efforts and work directly with publishers, sidestepping agencies and DSPs.

Agencies and media partners must start solving around full transparency into campaign performance and reporting. Agencies must cultivate and foster programmatic talent inside their own walls. DSPs need to offer true and fair pricing in regards to how CPMs are calculated to reduce CPM bloat. And all of this needs to be done in a way that clients understand and are willing to invest in retaining all of our services.

Written by Dallas McLaughlin–Director of Paid Media

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