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Why is a programmatic-first approach critical?

September 29, 2015 — by MediaMath    

Cologne - Germany

The need for connectivity has never been higher – that was the clear message at leading digital marketing event dmexco in Cologne recently.

Despite the German market being largely traditional and often reluctant to engage in disruptive activities – in comparison to the French, UK and Nordic markets – there was a great deal of progressive thinking in evidence.

For starters, it’s important to note that we live in an environment where saying data is important is now redundant. Consumers and clients alike know data is important and understand the role it plays in shaping better online experiences.

While this presents a number of opportunities, it also means we are now battling a number of disconnects, and challenges that increasingly demonstrate we need to re-examine the marketing funnel and understand why the old way is now out of date.

For MediaMath, connectivity, delivered through a multi-channel media approach, is a fundamental part of our business. In fact, it is crucial to how we deliver highly effective programmatic strategies for our clients. Our ability to do that is driven by data, but it is accelerated by a connected ecosystem, that bridges the on and offline worlds together. These connections determine the extent to which our clients engage with their customers in a meaningful way.

For this reason I welcomed the fact that dmexco 2015 highlighted the importance of bridging the gap between brand and customer. However, what emerged most strongly from that debate is that a real change of thinking and approach is required in order to achieve a truly connected ecosystem.

Unilever’s vice president of global media innovation and ventures Babs Rangaia, claims, “Ad measurability is only getting worse.” Sir Martin Sorrell’s quips, “the measurement model needs to be changed. The traditional model… is not efficient, effective or accurate in measuring traditional media.” Both remarks make it clear now is the time for change.

For me, that change should be driven by the adoption of a programmatic-first approach – the application of programmatic strategies across 100% of all media spend. More specifically, it’s when all assets (customer data, media, creative) are aggregated in one platform and data is used to inform every marketing execution. That may sound rather simplistic, but there are already examples of big business successfully entering the programmatic space in the last year. This highlights three core learnings.

Firstly, it may sound simple in practice but it takes a long time to get right. Not only does it require a dramatic change in thinking internally, activity needs to be carried out with the end audience in mind. If you are a large business, with multiple titles and platforms targeting different audiences, this can be incredibly complex.

Secondly, it can be highly effective. According to a report on AdExchanger earlier this month, a leading European media group has managed to increase revenue in lockstep with its audience growth since adopting a programmatic first approach. In fact, monthly unique users soared from 10 million to 25 million between 2014 and 2015, an increase based completely on organic traffic growth.

Thirdly, if companies like large media companies are only recently entering the party, we need to work much harder to educate the market about the benefits and value that a programmatic first approach can provide.

Which brings me to the importance of relationships. When it comes to talking about programmatic, we need to make sure we reference results that are tangible and meaningful. Real outcomes provide vital and valuable context to the solutions that are being bought. The label of the product is essentially meaningless, so is its functionality to some extent. What it will do or how it will enhance the business or audience is where the value lies. That’s what customers are buying. The relationship shouldn’t be about customer and vendor. It should be a partnership focused on achieving a valuable and influential end result.

Ahead of dmexco, we knew we were on the point of seeing a real change in direction in the advertising industry, especially in the UK. According to research released by eMarketer earlier this month, the UK digital advertising will grow by 62% this year to reach £1.8bn and will account for more than 59% of the display ad market for the first time.

While these growth figures clearly show acceleration in the market, we need to make sure we are continually evolving, innovating and ensuring that the relationship between, the brand, the agency and businesses like ours – in partnership with publishers – that help facilitate these connections, are all working together. Data is the glue that binds these relationships together and key to ensuring the precision of advertising retains the level of rigour expected by all involved.

I’ve said before that to achieve performance in the programmatic landscape, advertisers need real-time data. Targeting models that define the audiences to whom we should show particular adverts is one thing, the next step is the role creativity plays in shaping how engaging this content actually is. This reminds me of Steven Wolfe Pereira, VP of brand strategy and marketing solutions at Oracle Data Cloud, who observed “Creative people are not talking to data people and technologists.” If we can get that right, alongside better communication of the end result, programmatic will only continue to grow at a rapid rate.