Admedo 5 Steps to Programmatic Success (UK)

5 Steps to Programmatic

Success

A GUIDE FOR THE MID MARKET

© 2014 Admedo ALL RIGHTS RESERVED.

I +44 (0) 20 3603 8610 I www.admedo.com I 2

I THE FIVE STEPS TO PROGRAMMATIC SUCCESS FOR MID-MARKET BRANDS

INTRODUCTIONProgrammatic advertising is one of the hottest topics in the marketing sector today. Overall global spend will hit $53bn by 2018, according to Magna Global.

Yet to date the opportunity has mainly been taken up by big brand advertisers with equally big budgets.

This is a travesty, as programmatic advertising offers mid-market companies one of the best ways to level the playing fi eld with their big budget rivals.

Despite the opportunity and excitement around programmatic, much confusion remains, especially among mid-market brands, which are arguably best positioned to take advantage of the technology, as it levels the playing fi eld with their big-budget rivals.

However, new developments in the sector are putting the power back in the hands of marketers.

We believe it’s time for marketers to embrace programmatic advertising and reap the incredible rewards that have for too long been seen as out of its grasp.

This ebook is intended as an introduction to programmatic advertising for mid-market companies, fi nishing with a fi ve-point guide to making a successful move into the sector.

It’s time to make the leap into programmatic!

Nick Moutter,

CEO, Admedo

Programmatic advertising lets mid-market companies level the playing fi eld with big-budget rivals




Programmatic advertising – a def.i.n.i.tionProgrammatic advertising is the automated buying and selling of online display media through the use of technology.

Marketers have always striven to deliver the right ad to the right user at the right time, making assumptions as to where the right customers could actually be found. Programmatic buying removes this uncertainty, using both first and third-party data to precisely segment a desired target audience online. Marketers can then use this data to target that audience in real-time

and buy them for the right price, in the right context, and with the right message. The process is automated by machines and algorithms, working with the marketer to achieve campaign goals.

Demand-Side Platforms (DSP) give advertisers the ability to purchase online display advertising programmatically. At their most basic, they are technology platforms built to purchase display media across multiple bid-based inventory sources in real-time, from a single interface.




Time to get your head out of the sand!WE WANTED TO FIND OUT MORE ABOUT MARKETER’S ATTITUDES TO PROGRAMMATIC ADVERTISING AND HOW IT FITS INTO THEIR OVERALL MARKETING ACTIVITY. SO WE ASKED THEM.




WE TALKED TO 100 SENIOR MARKETING DECISION MARKETERS.THE RESULTS OF OUR SURVEY, RUN IN ASSOCIATION WITH THE DRUM, MAKE SHOCKING READING.

They show that many companies in this sector are missing out on the opportunities of programmatic with less than a third of respondents even aware of programmatic advertising.




Over half of respondents are aware of real-time bidding (RTB), one element of programmatic advertising

79%

20%

18%

13%

32%

54%78%

75%

11%

Almost four-fi fths of participants use search advertising

Less than a third of respondents are aware of programmatic advertising

Over three-quarters of respondents use online display advertising

Three-quarters of participants allocate less than a quarter of their digital marketing budget to

online display, the average allocation being 20%

£

Only just over one-in-ten of participants believe they have full insight into how much of their display budget is spent on services such as commissions to media companies, ad serving costs, third party or data commission costs

a fi fth believe it is too expensive

18% say it is too complex

13% say it is too diffi cult to measure performance

FOR THOSE THAT HAVE NEVER USED PROGRAMMATIC ADVERTISING, 28% BELIEVE IT IS NOT APPROPRIATE FOR THEIR BUSINESS

OF THE 28%




70%

50%

24%

had allocated less than a quarter of their overall budget to it

had allocated over a quarter of their digital budget to programmatic

of participants claim price is the most important criteria when selecting a partner for programmatic advertising

OF THE PARTICIPANTS THAT HAD INVESTED IN PROGRAMMATIC ADVERTISING...

Mid-market companies were among the first to realise the power of paid search advertising to help scale their businesses, and the survey reveals that the majority of such firms still do so.

BUT THE SEARCH ADVERTISING SPACE HAS BECOME CROWDED, AND WHAT WAS ONCE A COST-EFFECTIVE ADVERTISING MEDIUM IS NOW A SOURCE OF INCREASING FRUSTRATION DUE TO INFLATED PAY-PER-CLICK (PPC) COSTS.

However, the alternatives (display and in particular programmatic media buying) are vastly underused among such firms.

This is a big mistake as research continues to pour out proving the power of display to boost the effectiveness of search and vice versa. In fact research by Yahoo found that the incremental lift in retailers’ offline sales was 119% with a combined search and display campaign, compared to 82% with search alone.

Unquestionably, one of the biggest barriers to investing in programmatic advertising is a generic lack of understanding about how the technology works.

Indeed, what is worrying is that the terms ‘programmatic’ and ‘real time bidding (RTB)’ are often used interchangeably, resulting in a sizeable proportion of marketers not under-standing their benefits (as illustrated by our survey).

But RTB is just one variant of programmatic advertising (when media is bought and sold in an auction environment in an ad exchange).

But over half of respondents said they are aware of real-time bidding (RTB), one element of programmatic advertising

32% 54%Less than a third of respondents are aware of program-matic advertising




Historical barriers to mid-market adoption of programmatic advertising

In the early days of programmatic, pioneered primarily by US firms funded by Silicon Valley investors, it was pitched firmly as being suitable solely for top tier advertisers, and offered only on a managed service basis.

So it’s unsurprising many of you haven’t even heard of it.

These suppliers worked hard to keep exactly how their business operated a closely guarded secret, hence justifying their (highly priced) place on brands’ media plans.

Of course, as our survey highlights, the biggest barrier to the uptake of programmatic is lack of knowledge – something this ebook is designed to help address! But there are two other signifi-cant hurdles.

“THERE HAS BEEN A LOT OF SMOKE AND MIRRORS IN THE INDUSTRY. HENCE IT’S UNDERSTANDABLE HOW THIS COMPLEXITY CAN BE OFF-PUTTING FOR A MID-MARKET MEDIA BUYER” Rob Spicer, digital marketing manager at self storage company Safestore.




BARRIER ONE

Prohibitive minimum spend

DSPs have been used by big brands since the early days of the technology. However, they have not been readily accessible by businesses whose individual media budgets are significantly below tier-one corporate brands, but which none-the-less cumulatively account for a significant amount of media spend.

Another big reason mid-market brands have been in the dark.

Additional problems cited in the use of programmatic advertising by mid-market businesses include the contractual obligations in place from companies offering such services. Many of the big providers require a client to spend a minimum of £70,000 per month.




BARRIER two

Transparency of spend allocationOne of the major problems with the first generation of DSPs was that the cost of third party data providers (required for improved targeting via these platforms) was often prohibitive.

You can buy inventory on DSPs at a very good rate – that’s the whole point of them. But if you then apply data segments (sourced from third parties) to improve your targeting, this can cost up to five times the price of the inventory itself.

A lot of agencies and trading desks claim it is imperative that they integrate these third party data segments. But if you spend five times the media cost on data, then you want to see five times the improvement on the campaign performance - which doesn’t happen.

While we would never downplay the role of data, it needs to be cost effective for your needs and at Admedo we have yet to see campaign performance increased proportionately according to the spend on third party data.




The above historical barriers are just that – in the past. We’re in a new phase of the evolution of programmatic advertising, an age that brings with it a number of developments that will make this technology accessible to all.

LET’S FIND OUT WHAT SOME OF THESE ARE.

Don’tpanic!




While programmatic advertising technology has evolved rapidly over the last few years, until recently very few (if any) of the existing DSPs have been designed with ease-of-use, accessibility and transparency in mind.

Thankfully, this is changing. DSPs, and the enhanced audience-reach capabilities they provide, are no longer the privileged domain of big brands.

This is important, because programmatic is disrupting the very way brands buy media.

The managed service model proposed by the first generation of DSPs wasn’t really suitable for mid-market firms and also did little for transparency issues. Hence, mid-market businesses have been in a state of limbo when it comes to taking advantage of this technology.

DSPS FOR THE MID-MARKET

“With programmatic media trading you are buying audiences. In offline media, you’re essentially buying context. For instance, in an ad exchange you can spot a ‘Guardian reader’, but the media space available on the exchange to get to this person might actually be an impression on Angry Birds. Advertisers need to realise they can reach the same person, just in a different environment to the one they’d normally reach them on.” Paul Childs, Mobile Advertising Veteran, Entrepreneur and Advisor to Mobile Ad Tech Companies.




Today, the market is finally seeing the emergence of technologies that make programmatic media buying possible on a self-serve basis.

Our survey identified a latent demand for such services among mid-market companies. 60% of respondents claimed self-serve functionality is an important part of media trading, with only 4% reporting that it is unimportant to them.

Meanwhile, over a quarter (27%) of those that did express a preference for self-serve functionality cited a lack of in-house experience as the reason for outsourcing their digital media buying.

It’s important to remember that when you take media buying in-house you have increased control and transparency, especially when marketing budgets are tight.

The new wave self-serve platforms also let brands ensure measurement is transparent in real time, letting them benchmark their campaign performance against any criteria they choose.

THE SELF-SERVE REVOLUTION

“THE BEAUTY OF USING THIS KIND OF TECHNOLOGY IN-HOUSE IS THAT YOU’RE IN CONTROL,” SAYS SAFESTORE’S SPICER. “PLUS, YOU DON’T HAVE TO AGREE A PRICEY CONTRACT WITH A MEDIA AGENCY.”




Finally, there’s another important evolution of the DSP that will benefit mid-market brands – improved mobile capabilities. This is something Todd Trann, MD Europe of mobile ad exchange Nexage, believes is crucial.

“Given that most mid-sized companies operate across a smaller geographic area, the development of mobile is key. The ability to find the right audience in the right location is priceless for smaller companies,” he says.

The barriers to programmatic for the

mid-market have crumbled.

So, it’s time. Time to make the move into programmatic advertising. First though, you’re going to need a technology partner to help you do so. No one’s saying this is going to be easy, but our five-point checklist below will ensure you find your perfect partner.

GOOD LUCK, IT’S GOING TO BE WORTH IT!

GOING MOBILE




Embracing Programmatic ADVERTISING: A Five-Point Checklist

THE SHIFT TO PROGRAMMATIC POSES MANY CHALLENGES TO THE MODERN MARKETER. THERE ARE A HUGE VARIETY OF POTENTIAL PARTNERS THAT WILL HELP MID-MARKET BUSINESSES DEVELOP THEIR PROGRAMMATIC STRATEGY. BUT THERE ARE ALSO MANY POTENTIAL PITFALLS FOR THE UNWARY. THE FOLLOWING ARE OUR TOP FIVE TIPS FOR FINDING YOUR IDEAL PARTNER TO HELP YOU ON YOUR PROGRAMMATIC JOURNEY.




Bring everything under one roof

The first thing you need to be looking for is a full campaign management solution. For a mid-market company, it’s crucial to find a system that will let you take control of every element of programmatic campaigns, from ad serving to creative to targeting, as well as delivery, all in one.

When you get all your elements of campaign optimisation at your fingertips through a single interface, you can make the jump into programmatic with far lower resources. Big brands may well have large teams of people dedicated to programmatic advertising, but with the right platform you can get started with a team of one!

You need the system you select to be incredibly user friendly, so it can be picked up easily by a variety of people in your company. This way you avoid a lot of the laborious processes of programmatic advertising adoption, one of the reasons many companies have avoided it so far.

And with limited resources, you haven’t got the time to keep having to log in to different platforms or making these disparate systems work together.

So when you’re searching for your technology partner, always try and look for a full-stack solution. The usability, and the fluidity of the decision-making process it enables, are the real winners here.

1




Insist on transparency of spend

When you’re making your move into programmatic, the warning ‘buyer beware’ has never been more appropriate. It can be a murky world, so it’s vital you make sure you get full viewability and transparency into the margins you will be charged, and a full breakdown of your overall spend.

This is the best way you can assess your return on investment (ROI), and actually the real costs of acquiring each customer. Some programmatic advertising companies will try to hide the real figure. Although you may be presented with a flat-rate CPM (the cost of

1,000 advertisement impressions on one webpage), often the company offering this service will actually buy the audience you want to target from a third party at the cheapest possible price to maximise their own margin.

It’s your responsibility to insist on seeing real data showing how much of your budget is spent on every element of the service being provided to you. Only by building this into your cost per acquisition (CPA) can you assess ROI properly.

2




Find out exactly where your ads are appearing

Programmatic advertising gives you unheralded reach, letting you target the right audience no matter where they are online. But there are dangers here too. With any partner you work with on programmatic, you need to insist on knowing exactly what sites and content your brand will appear against.

Programmatic advertising means moving from the traditional advertising model of media placement to that of buying an audience – this is where brand safety can be risked. You really don’t want your ads popping up in an environment damaging or unsuitable for your brand. If your partner can’t give you this peace of mind, walk away.

You should also demand full transparency of the sites where your ads will be appearing, which sites perform best, on what times of day, and what geographies perform best in terms of conversions. This data is gold dust in helping you shape your overall marketing strategy.

Finally, don’t let your partner be hung up on using programmatic for serving users retargeted ads. Retargeting can be incredibly effective but if used bluntly can also be incredibly damaging to your customers’ view of your brand. Ask for proof your partner has the tools in place to be able to use retargeting effectively and responsibly.

3




Programmatic is for everyone, no matter what your budget. But at the same time you need to be realistic.

For most mid-size companies, a test budget of at least £2000-£5000 will be needed if you’re going to gain any worthwhile lessons from your pilot. You can, of course, start with only a few hundred pounds but the data you get back from this test will be too limited to let you understand whether or not your efforts have worked, effectively a waste of money.

Effective programmatic advertising depends on the use of machine learning technology to optimise campaigns. So you’re going to need a minimum of two weeks for this process to really start kicking in. Don’t worry though, the machine learning process speeds up with use. But make no mistake, programmatic is not an overnight solution.

4

ALL RESPONDENTS BELIEVED THEIR SPEND ON PROGRAMMATIC OVER THE NEXT YEAR WOULD INCREASE OR STAY THE SAME.

Invest the right amount of time and budget in programmatic




Finding a reliable partner to help you make the move into programmatic advertising will be one of the smartest moves you’ve ever made. So make them work for your business! Programmatic is now a mature technology so don’t be afraid to demand proof of your partner’s promises.

Don’t just rely on what they offer you though. It’s also best to double-source any such information, be it from an agency, and/or another vendor, as this can provide greater transparency. Crucially this can help with the all-important ‘internal buy-in’ within your organization, especially for colleagues that may not be as digitally savvy as their digital marketing department.

Insist on evidence

5




WE WOULD LIKE TO EXTEND OUR THANKS TO THE FOLLOWING, WHO HELPED IN THE RESEARCH FOR THIS PUBLICATION.

TODD TRAN, NEXAGE, MANAGING DIRECTOR, EUROPE

ROBERT SPICER, DIGITAL MARKETING MANAGER, SAFESTORE

RONNY RAICHURA, HEAD OF DIGITAL PERFORMANCE, ADCONNECTION

PAUL CHILDS, ENTREPRENEUR AND ADVISOR

Sources




ABOUTADMEDO

contact details UK

Phone: 020 3603 8610

Email: [email protected]

Address: Greenhill House,

90 - 93 Cowcross Street, Farringdon,

London EC1M 6BF

UNITED STATES

Phone: (+1) 949 572 7098

Email: [email protected]

Address: 4590 MacArthur Blvd.

Suite 500 Newport Beach,

CA 92660

ACCESSIBLE PROGRAMMATIC ADVERTISING

Admedo makes programmatic advertising

accessible and more profitable for your business.

We are empowering advertisers and agencies

worldwide with accurate insights into their media

spend and more cost-effective, targeted display

advertising through our cloud-based, self-serve

programmatic technology.

Set up is simple, and with flexible licensing options

ranging from a free, basic version to a white label

solution for agencies, you’ll be driving leads and

conversions in no time at all.

With Admedo - You’ve got this!

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Admedo 5 Steps to Programmatic Success (UK)

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