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December 10, 2014, Article

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The Drum: eBay Advertising’s Phuong Nguyen and Others Discuss Promoting and Scaling Programmatic

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What happens when you get a group of programmatic experts together in a room? The Drum recently did just that, hosting a round table with eBay Advertising. Catherine Turner takes a look at what’s setting their agenda – from the need to better promote programmatic to the opportunities of global scale.

Programmatic must do more to sell itself to the very users who benefit the most, a group of experts has claimed at a round table hosted by The Drum for eBay Advertising.

The executives – from eBay, media agencies and programmatic platforms and specialists – believe that the industry is failing in its duty to inform clients, creative agencies and even publishers of the benefits of automated, targeted trading.

In a gathering noticeable for its absolute consensus rather than a clash of opinions, they say the digital subsector must stop ‘talking technology’ and adopt the marketing know-how of the audience it serves.

Says Phil Duffield, head of international at AOL-owned platform and marketplace Adap.tv: “The education around programmatic is so bad.”

Duffield believes that clients with little understanding of programmatic will only hear and read the negative press – “the fraud, the brand issues” – which can only put marketers off. “Our biggest challenge is the education of marketers. Why aren’t we educating more? It’s our responsibility.”

It’s a view echoed by all. Note, they say, the absence of any brand around the table today. David Reed, MediaMath’s EMEA managing director, says simply: “The industry needs to change how we talk about programmatic.” It should start by stopping the incessant sales pitches at industry events: “Why would a client go to an event where it is all ‘sell’ – they aren’t interested in that.”

MediaMath instead encourages clients to attend workshops and talk to other clients. In such an environment it isn’t the technology that shines – it is merely an enabler for clients to “do” better advertising.

Or as Phuong Nguyen, head of eBay Advertising, notes – think about the consumer, the “human” factor. He points to a recent, high profile industry summit where neither was mentioned – an omission that eBay’s chief marketing officer would surely recoil at. “We’ve done a great job of talking about the efficiencies of our business, but we lose sight of the fact that we live in a human industry, and of our ability to persuade consumers to do something different.”

It’s a point that Kathleen Schneider, Criteo senior vice president of marketing and communications (and a former client-side marketer), continues. “We perceive ourselves as technology companies, but we sell to marketers. If we can’t bridge that gap then we need to reconsider the keynote.”

She wants marketers to understand that machine-led technology is often better than people “turning those dials” and wonders why the publishing space doesn’t yet apply the same logic for search where “analytics drive that best decision”. That will be an even harder sell for television, even though broadcasters are close to a place where even linear TV spots could be offered up programmatically.

Because, they say, programmatic is playing a vital role in making paid media more flexible, accountable and affordable – particularly in the smaller digital economies – its potential for brands is being overlooked by clients unaware of the possibilities. Technology is evolving fast, but perceptions continue to lag, and at different rates, market by market, client by client.

Unfortunately, says VivaKi’s Geoff Smith, it’s a state of affairs set to continue until clients start recruiting programmatic specialists. Smith, EMEA vice president of audience on demand, adds: “I believe that we haven’t even defined ‘programmatic’ for many chief marketing officers.”

Neither, he believes, do the big creative agencies get it, or even want to focus on the scope of digital possibilities. “They don’t want to build big digital ideas. They don’t care about dynamic or HTML5.”

Nor, according to Amnet chief operating officer Sacha Bunatyan, is digital ideally set up to see how brand and creative really resonate with consumers, often laboring under a return on investment argument built by search.

Reed concurs: “Google established what ‘online’ was. And we still live in that same box. Search became dominant so cost-per-click mattered.”

Yet for all the industry self-flagellation there is plenty of promise in programmatic – and a great story ready to sell advertisers.

The UK is widely admired as one of the most mature and innovative markets, with the IAB forecasting programmatic will account for nearly half (47 per cent) of digital display ads in 2014 and an upsurge in the quality and quantity of private marketplaces. France, Australia, the Czech Republic and in the last 18 months Germany, have also been beacons of good practice, particularly in the premium space.

Rubicon Project’s international general manager Jay Stevens points to programmatic’s rapid evolution. “Where it was all about the unsold ‘remnants’ four or five years ago [still common practice in the US], now we are moving upstock pretty quickly, such as with the evolution of private marketplaces. There is a blurring line between premium and remnants – and a changing dynamic for both sides of the ecosystem.”

He compares it to the stock market, pointing that the Nasdaq – once the preserve of over-the-counter stocks – “no longer has the stigma it once did”.

Stevens also points out programmatic’s value proposition, making digital more effective to plan and buy – of particular importance in smaller markets such as Spain which, with macro economic pressures, is actually seeing digital spend decrease while traditional TV grows. Digital will struggle to grow in smaller markets without automation because of a lack of scale. “They won’t grow, and Google and Facebook will continue to own,” adds Stevens.

The French, meanwhile, have been keen to explore co-ops, giving publishers that grander scale on which to compete.

Anna Stoyanova, Essence’s biddable media director, points to Germany as a market slow to take to automated trading, but one that while late to the programmatic party is getting it right. “Germany has been moving a lot this year. It is a sales-house dominated market, and quite consolidated. You only have to crack 10 nuts but those 10 nuts are tough to crack,” she says. “There is a huge movement from Germany – a massive willingness to embrace. They understand it’s not about remnant it’s about premium,” echoing Steven’s earlier point.

Earlier this year eBay Advertising announced that it now trades the majority of its inventory programmatically and would soon launch a series of mobile native ad formats. And this week Nguyen revealed exclusively to The Drum that it would trial programmatic-only in Q1 of 2015 – an initiative Stoyanova says cannot come soon enough.

Such big players making plays can only underline the growing importance of programmatic moving forward, and help clients – and their agencies – explore the possibilities.

But we’re not there yet, cautions Attila Jakab, Infectious Media client strategy director. He says that much of the innovative and educational, experimental work thus far has been done via manual face-to-face conversations, which will take some time yet before they move onto platforms and be automated.

Adds Jakob: “Technology is definitely at a really nice place from an access and speed point of view. In the basics of an exchange-based market, we’re really healthy. But the smartness of algorithms, the ability to go around the globe and specifically to particular markets, these are problems we don’t yet have solutions for.”

A connected, programmatic view of the consumer, across an as yet technology media fragmented space and regionally siloed world? Watch this space.

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