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The programmatic trading paradox: Avoiding bad placements in digital

by Cameron Dinnie

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Programmatic trading is proving to be more than just a buzz word. It’s gained significant momentum in the past three years and now accounts for over 50 per cent of digital display ad spend in Australia.

Programmatic trading represents a significant change in the way we buy media. While lots can be written on the topic, the features of programmatic trading can be captured under two broad headings: 

  1. The introduction of automation
    This involves moving from media insertion orders, which had to be carried out manually, to an automated workflow utilising a variety of platforms.
  2. A movement towards audience-based buying
    Rather than using publisher sites as a proxy for audiences, advertisers are increasingly overlaying first, second and third party data to ensure they are reaching the right people with the right message in the right moment. 

 Publishers and ad networks historically used the automated feature of programmatic trading to sell large volumes of low quality inventory which were not traditionally sold. The digital display market was flooded with cheap ad inventory and little concern for the context it might be shown in.

As the market has matured it represents an increasing share of digital ad spend. But this has presented significant challenges for advertisers, agencies and publishers.

Given its relatively poor start, buyers have had some trust issues with programmatic trading. This has led to transparency and brand safety emerging as two of the market’s largest challenges to future growth. The key thought being that not all inventory is created equal.

The context in which an ad is displayed can have a huge impact on the campaign’s performance, both positive or negative. 

Beyond a single campaign, over the past few weeks we have witnessed the significant fall-out from the uncontrolled placement of ads across Google and YouTube among others. The response from advertisers and agencies has been swift and substantial. Budgets were pulled from the platform entirely.  

This highlights one of the fundamental challenges of programmatic: the changing buyer and seller relationship. We are moving from an era where you would trade with a business you know and share a strong relationship with. Now it’s  purely transactional and based on cookies.  

Transparency over what you are buying, who are you buying from and where it will be shown should not be taken for granted. The Google case is just one of the many examples of what can go wrong when inventory is bought with limited transparency and without the proper controls in place. This is not a simple problem to solve, it’s technical and nuanced, with differences in capability across devices and inventory types.  

So how should we move forward?Advertisers need to demonstrate their preference for buying disclosed inventory. They need to know what they are buying and who they are buying from. If non-disclosed inventory has to be bought, then they must ensure that the right and appropriate controls are in place to ensure transparency and brand safety. 

  1. Advertisers need to demonstrate their preference for buying disclosed inventory. They need to know what they are buying and who they are buying from. If non-disclosed inventory has to be bought, then they must ensure that the right and appropriate controls are in place to ensure transparency and brand safety.
  2. Independent third party verification is a must. Advertisers need to check reports on URLs, sites and apps where their campaign is running. That way, discrepancies and unknowns (which can be indicators of ad fraud), are highlighted and can be rectified.

As an industry, we must demand a greater level of accountability and transparency from publishers and ad networks. Brands are a valuable commodity. Any links to content which go against brand values can be extremely damaging.

In a rapidly changing world, agencies need to make sure their ads are getting the context and treatment that’s right for them. 

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