Increase in Programmatic Ad Buying Among Top Marketers

Programmatic ad buying has increased significantly over the past two years despite serious concerns among marketers about digital ad fraud and a perceived lack of transparency, according to a new survey.

The survey revealed that the number of marketers using programmatic ad buying has exploded since a previous survey in 2014, with 79 percent of respondents saying they have made programmatic buys in the past year — more than twice as many as in the 2014 survey (35 percent).

Programmatic buying in the past year was highest for online display, online video, mobile display, and mobile video. In the next year, the media with the most anticipated growth are social video, social display, mobile video, and television.

Respondents to surveys in both years indicated the leading benefits of programmatic buying were better targeting and real-time optimization.

However, despite the significant growth, respondents indicated they still consider digital ad fraud and a lack of transparency in programmatic ad buying to be serious obstacles to the effective use of programmatic advertising.

Almost 70 percent of respondents cited higher bot fraud in programmatic buys as a concern. At the same time, varying numbers of respondents said a lack of transparency regarding the costs associated within the programmatic supply chain, a lack of inventory and data transparency, and a dearth of information about whether an agency reaps financial gains from the media seller by using the client’s funds all posed challenges to the overall programmatic experience.

“While programmatic buying indeed offers benefits, it suffers from complexity and a lack of transparency,” said Bob Liodice, president and CEO of the ANA. “And that is wasteful. The industry — and marketers in particular — would greatly benefit from a rethink of the entire digital supply chain.”

As a result of their concerns, 31 percent of respondents said they have expanded their in-house capabilities to manage and oversee programmatic ad buying. In addition, marketers indicated they have taken steps in response to transparency concerns:

•     Requested detailed campaign guidelines and reporting from agency partners (62 percent)
•     Aggressively updated so-called “blacklists” (51 percent)
•     Targeted “whitelists” (45 percent)
•     Purchased inventory through private marketplaces that media companies have created (42 percent)
•     Added language in insertion orders to increase transparency (40 percent)

The survey was conducted in February 2016 and included responses from 128 ANA members.

“This survey clearly shows that marketers need — and are embracing — programmatic buying’s flexibility and targeting ability in order to respond to today’s fast-moving media environment,” stated Jim Nail, who led the research on behalf of Forrester. “But to reach its full potential, marketers need to make better use of the available tools, while the media and technology communities must do more to embrace transparency.”