Programmatic: the Good, the Bad, and the Transparent

Programmatic has been the dominant form of buying and placing digital advertising since the 2000s. Its impact on the industry is undeniable. Yet despite its popularity, concerns over fraud, efficacy, and privacy persist.  This past month YouTube emerged as the next in line to be under fire for potential fraud within the programmatic space.  Adalytics reported that about 80% of YouTubes third party video ad placements did not meet their terms of service resulting in billions of lost ad impressions for more than 1,100 brands. 

At Transparent Partners, we are dedicated to establishing transparency and trust in programmatic practices. Empowering brands with the confidence and clarity needed to deliver value for their customers. 

A Brief Programmatic History 

Programmatic media buying has its roots in the early days of digital advertising, when the first ad exchanges began to emerge in the early 2000s. These exchanges provided a platform for advertisers and publishers to buy and sell ad space in real-time auctions.

From there, the use of software and algorithms to automate the digital advertising buying and selling process accelerated producing considerable benefits for marketers.

Programmatic, Why Does it Matter?

Since its inception, programmatic has changed dramatically through the use of software and algorithms to automate the digital advertising buying and selling process.  That acceleration has brought considerable benefits to marketers including:

• Improved Targeting: Programmatic media enables advertisers to target their ads to specific audiences based on a variety of data points helping them reach their intended audience more effectively and with greater precision
• Advancements in Attributable Measurement: Tagging and advanced measurement available within programmatic media allows advertisements to be highly measurable ensuring accurate and detailed insights to better optimize campaigns for greater performance leading to increased ROI
• Opportunities for Real-Time Optimization: Programmatic media buying allows advertisers to optimize campaigns in real-time based on performance data- adjusting targeting and bidding strategies
• Increased Efficiency: Programmatic media streamlines the ad buying process by automating many of the manual tasks involved allowing for faster and more efficient buying
• Potential Cost Savings and/or Efficiencies: Real-time bidding cuts down on wasted ad impressions by serving ads to relevant audiences, minimizing fraud lowering overall cost to drive a higher ROI

It’s no wonder then that  programmatic ad spend accounts for the majority of digital ad spend in many markets. A recent study by Insider Intelligence reported that programmatic advertising represents around 90% of digital display advertising spend.  In fact, by the end of 2023, projections show the total US programmatic display spend to increase by 15% from last year to nearly $142 billion. 

Concerns and Skepticism 

So then why, you may ask yourself, do concerns over fraud, efficacy, and privacy persist? As the old adage goes- with great power comes great responsibility. Or in programmatic’s case- with great spend, comes great demand for accountability and increased scrutiny. 

YouTube’s recent scandal is not an outlier, reports come out seemingly daily exposing concerns and issues within the space. 

When distilled, eight core challenges emerge as the root cause of persisting programmatic concerns: 

1. Rapidly Evolving Landscape: the field is constantly evolving with new technologies, platforms, and strategies emerging regularly
2. Complex Ecosystem and Murky Supply Chain: it involves a complex ecosystem of stakeholders, including advertisers, publishers, agencies, ad tech vendors, data providers, and intermediaries
3. Lack of Standardization: it lacks universal standards and guidelines for various aspects, such as data quality, ad viewability, ad fraud detection, and measurement metrics
4. Ad Fraud and Brand Safety Issues: it has been plagued by ad fraud, including non-human traffic (bots), ad stacking, domain spoofing, etc. which not only waste budget but also raise concerns about effectiveness and integrity of programmatic buying
5. Data Privacy and Consent: it relies heavily on data-driven targeting and personalization. As a result issues related to data privacy, consent, and compliance with regulations like GDPR and CCPA have amplified the need for transparency
6. Lack of Education and Expertise: it involves sophisticated technology, algorithms, and data analysis- some advertisers and marketers lack the necessary knowledge and expertise to navigate the complexities effectively
7. Media Fragmentation and Fragmented Reporting: the fragmented nature of media and reporting due to proliferation of channels, platforms, and devices, makes it difficult to obtain a holistic view of campaign performance. Which leads to concerns about transparency and ROI measurement.
8. Incomplete or Inaccurate Measurement Metrics: Accurate measurement and attribution of programmatic media campaigns can be challenging
   • Issues such as viewability, ad placement verification, and cross-device tracking pose difficulties in assessing campaign efficacy accurately, fueling concerns and skepticism

The list may be intimidating, but know it’s not impossible to overcome. As the great Sun Tzu said, “Know yourself and you will win all battles.” Take a moment to digest these challenges and take stock of your current state.

• How have they influenced your programmatic practice? 
• Can you measure or quantify the impact? 
• What actions can you take to mitigate their influence? 
• Do you have the expertise to address or prevent? 
• Are you prepared to resource your team to consistently monitor and optimize your approach long-term? 

We can help!

Leveraging years of hands-on expertise as media buyers, planners and brand managers, we developed our namesake biddable media assessment, which has armed some of the largest fortune 100 brands with actionable strategies to increase programmatic efficiency and effectiveness.

Our proprietary approach evaluates ten distinct areas that influence biddable media efforts and ultimately, the creation of meaningful connections with consumers. The result is a comprehensive view of a brand’s biddable media maturity compared to the industry, summarized opportunities for enhancement and innovation, and a detailed action plan for enablement.

If you are interested in uncovering transparency within your programmatic spend, connect with us here.