Having emerged from the remnant inventory monetization, the programmatic demand is now driving a significant part of digital spendings and thus revenue of the online publishers. Everyone on the market has strong expectation, but the ecosystem remains un-mature and many publishers remain reluctant to proactively enter the game.
Will publishers make the most of programmatic opportunity embracing premium programmatic?
The large majority of programmatic inventory is not PREMIUM yet
The volume currently available for programmatic trading is impressive. Trading desks are already able to reach tens of billions of ad impressions on a daily basis and it seems that nothing can stop the wave.
However one of the media buyer’s main concerns remains the quality of the inventory available on programmatic marketplaces and the resulting lack of transparency of the media sellers.
The programmatic comes primarily indeed from the open exchanges, who are aggregating some remnant inventory of premium publishers, but who first of all collect the traffic of websites which are not able to sale their ad spaces on their own, whether because they are too small or because the content quality doesn’t allow to address direct media buyers. This composes the very large majority of the available programmatic inventory.
Programmatic versus PREMIUM PROGRAMMATIC
The first programmatic marketplace (the dark side) could be described by the following: strong intermediaries, huge volumes, no pricing transparency which leads to low price and low margin for the publishers, almost no control for the publishers about the quality and brand safety.
This is the extension of the arbitrage kind of business that was existing already 10 years ago.With the run for quality, a brand new programmatic ecosystem is emerging from the in-mosts digital depths. And it has nothing to do with the previous one.
The upcoming (and still ideal) new marketplace offers the following benefits to the publishers: direct access to the media budget (no media intermediary), highest level of control, and full transparency on the value repartition, high quality and high priced campaigns.
In both cases, the technology plays a major role to automate the transaction, in both cases, data is fueling the media spendings: these two worlds are the two poles of a magnet, they are complementary BUT also very different as do not serve the same interest.
Premium programmatic marketplaces, the real opportunity for publishers?
The benefits of the premium programmatic technology for publishers are obvious and so is the opportunity: they can gain in effectiveness, in control, reach more buyers, improve yield and avoid intermediaries.
There are challenges too as publishers must find ways to protect their best asset (1rst party data), find and learn the technology and implement a strategy in a fast moving market.
Awareness has arisen and most major publishers have now entered the game from one side or the other. Within 5 years, the technology to operate one impression programmatically won’t be higher for publishers than what they pay today for standard ad serving. It will be much easier to the people able to manage yield, data and RTB.
Publishers have the opportunity to build an ecosystem where they capture a higher share of the digital spendings.
Will Publishers decide or not to regain the control of their advertising strategy ?
Premium programmatic requires technology, it may require external expertise and services BUT it doesn’t require intermediaries. It first of all does allow Publishers to bypass all media intermediaries, to reach directly to the media budget and increase their media revenue margin.
Bets are open: will one side overtake the other? The big media money is definitely on the side of the premium programmatic. Will publishers manage to stay on their own or will they allow some middlemen to take the bigger part of the cake? Will they decide to regain the control of their ad revenue?
We at Smart AdServer fight for what we think is the good side…
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