Automated buying and selling solutions, also known as programmatic, has now reached critical mass, with the potential not only to facilitate process and target a specific audience – but for publishers to benefit from new digital revenue streams.
The slow take-off has stemmed from criticism over perceived failure to deliver, as well as concerns over brand safety and transparency. It must also be said that some simply did not understand it. However, the entrance of News Corp Australia with its digital client resource package – including its targeted Multibrand Exchange – and Fairfax Media with its mobile programmatic platform, APEX, have brought programmatic into the mainstream, along with APN News & Media’s regional offerings.
Jason Denny, head of programmatic at News Corp Australia, believes that the solution has increased efficiency. “It’s essentially the automation of the media buying process which creates efficiencies,” he said. “The promise of programmatic is that it eliminates a lot of the process that has been involved in media buying over the past 15 or 20 years.”
As a result, the amount of time required to carry out these processes has been reduced. “The reason why it works so well with programmatic is because you can build those strategies, develop the right algorithms to optimise, if you will, towards the strategies that’s working in real time,” said Mr Denny.
“And you don’t have to wait a week or a month to really understand, to be able to extract that data and decide if it was working or not.”
In the past, the automated process took place on an open exchange, or ad network, where requests from companies are registered and processed. However, there was no knowing where advertisements would appear.
Steve Allen, managing director of Fusion Strategy, said that this lack of control resulted in advertisements appearing next to content with which companies did not wish to associate their brands.
“What advertisers here and overseas have found is that programmatic is all well and good, but the ads are appearing in inappropriate environments; they’re appearing in all sorts of places that, after the event, clients go ‘well, why are we there?’,” he said.
In essence, clients were buying blind, and could take only what the exchange had on offer.
Private exchanges have attempted to solve this problem. However, there are limitations to some of these exchanges – as well as questions of scale. The Pangaea Alliance formed earlier this year went some way to overcome this by offering inventory from various international publishers, including The Guardian, The Financial Times, CNN, Reuters and The Economist.
Enter News Corp Australia and Fairfax Media, which launched premium programmatic solutions within 24-hours of each other in July. Both companies say the exchanges enable companies to advertise their brands safely, while delivering audiences at scale.
At its Come Together event, News Corp launched News Connect, which uses data from News Corp and Quantium to qualify audiences, and Multibrand Exchange (MBX), a private premium exchange combining digital assets from News Corp and MCN.
Sharb Farjami, director of national sales at News Corp Australia, believes that MBX will set News Corp apart from its competitors.
“I think the difference that MBX delivers is the immediate reach and scale, with the two networks together, as well as knowing they will engage in premium style environments, and it is brand safe,” he told The Newspaper Works.
Mr Allen is impressed with this offering. “The pitch that News made was more a public pitch, and they were pitching quality environment, quality audience, they were pitching other metrics. You can buy programmatic but buy from us, and in a much safer space, and we’ve got monster numbers, which is a pretty good pitch,” he said.
Fairfax Media launched Australian Premium Exchange (APEX), a premium, brandsafe, mobile programmatic exchange in partnership with Mi9. APEX offers premium mobile inventory, using the mobile properties of both companies. APEX chief executive Pippa Leary says it is the fact the company has targeted mobile that makes it different.
“Usually most of the premium exchanges have gone out on desktop first . . . we’ve gone out on mobile first, and no one else has done that,” she said.
Mobile properties owned by third party publishers, such as Daily Mail Australia, are also included in APEX, with others likely to join.
“The reason people want to trade programmatically is because it’s so efficient and so targetable . . . but they haven’t been able to do it in mobile before, so we’ve decided to go out and create something really unique,” Ms Leary said.
Interactive Advertising Bureau chief executive Alice Manners believes it is important for publishers to understand the inventory they have, and know how to manage that yield.
“It’s about showing the advertiser how effectively they can reach the audience that they want to across those news sites,” she said.
However, it is important for all publishers to have a programmatic strategy, not just news publishers, Jason Denny says. “If our partners are moving to transact their budgets programmatically then we, as a partner, need to make sure that we’re able to facilitate that.
“So that’s why I think it’s extremely important for all publishers, not just News, to make sure they have a programmatic strategy in place.”
Sarah Keith, head of investment at media buying group Vivaki, believes that having the right data is key to programmatic success. “I think the key to programmatic is the right data. Automation should be pretty simple. You develop systems, and we can automate most things in life,” she said.
“The key to successive programmatic solutions is the quality of the data, and I think that’s going to be the winner in this, and the most successful exchanges will be the ones with the data that effectively generates return for the clients.”
This focus on data is not a new concept. “Data has always been a driver for finding who your clients or who your customers are, no matter what kind of business you’re running,” Mr Denny says. “So, we live in an age of big data now, and we’ve been collecting it for a while, and now it’s time to mine it, and to really understand which audiences work, and speak to which brands, and to optimise towards those audiences,” he said.
Mr Denny says websites such as Google and Facebook have had a longstanding hold on the programmatic market. This was one of the reasons why News Corp launched MBX, to offer something better, he said.
“The competitive difference, I would say, between Google, Facebook, and traditional news publishers like ourselves is that we’re creating our own content, whereas Google and Facebook, they’re aggregating.
“So the fact that we create our own content, the users coming to our site . . . are already engaged. You’ll see a lot of brand dollars shifting to content creators rather than aggregators just for that reason, I believe.”
In the past, trading programmatically on mobile platforms has caused problems, Pippa Leary says. “The issue of buying in mobile ad networks is you go back to the same problem of open exchanges; you can’t tell what you’re buying.
“Mobile is important because the technology to create a mobile market place is very new; AppNexus [the provider of the APEX platform] had only just developed it, and we were one of the first to use it.”
According to Alice Manners there is still that lack of understanding of what programmatic is. “I think that does come from the fact that initially a lot of it was around remnant advertising, and so people see programmatic as a channel – but it’s not a channel, it’s about reaching an audience,” Ms Manners said.
Other mediums are also considering programmatic solutions, she says. “Programmatic is definitely entering the space of other mediums as well … and I think that’s where things will be really interesting in the next couples of years because they’re going to be coming from the digital world in looking at things in the traditional world.”