Five challenges of programmatic that CMOs must understand

econsultancy.com

You are a CMO and you are falling behind in the race to understand and implement programmatic advertising campaigns.

If that applies to you, Econsultancy's new report, The CMO's Guide to Programmatic, in association with AudienceScience, may be of use.

For those about to go programmatic, here are some of the challenges you'll face...

Attributing revenue to programmatic

Programmatic advertising, with its ability to target users with known behaviours, is rightly heralded as a dramatic improvement on the old spray and pray of display advertising.

But its implementation requires a healthy tech stack and marketing strategy. Last-click attribution is insufficient in showing the true value of programmatic advertising to marketing as a whole.

Sammy Austin, Head of Media in Group Marketing at TUI Group, describes this as her biggest challenge:

The biggest challenge for us is most definitely measurement. There is a huge opportunity for programmatic beyond retargeting, there are so many strategic opportunities at the upper end of the purchase funnel...

How can we understand the value of that activity on the final conversion/sale if we continue to measure on a last-click basis? Attribution is key to scaling programmatic, proving its value and future investment.

A further case study comes from Virgin Holidays, where James Libor, marketing technology manager, realised that using different models for different channels was resulting in reporting duplication that impacted revenue expectation.

The first step was to get our online marketing data in shape. We implemented a lot of new solutions like impression tracking, affiliate segmentation and cost and margin imports.

I knew where I wanted us to get to and it helped that I wasn’t in charge of a particular channel because there’s no bias. 

Achieving transparency

Some agency trading desks, which negotiate inventory prices from publishers and operate their own demand side platforms, have been accused of a lack of transparency, not disclosing their margins.

This has led many advertisers to work with independent trading desks or negotiating contracts with various tech partners directly.

Paul Cable, Head of Marketing at First Utility, explains how they did just that:

We moved away from the traditional trading desk a long time ago, the simple reason for this is the necessity of transparency, allowing for lower costs and more importantly, greater control – which none of them were providing.

Sammy Austin points out that advertisers can still access the expertise of agencies, but use independent partners as well.

The service layer that an agency trading desk provides can be supported by an independent partner, there are ways of accessing the same datasets, publishers, targeting solutions, etc. from other partners, either deployed via the agency or independently.

Marketers' biggest barriers to increasing programmatic ad spend

Tracking offline impact

Of course, this is an issue that besets all online marketing, but one that has recently improved with the development of store visits and offline conversion tracking at Google and Facebook.

However, outside of those advertising at scale with both these ad giants, offline impact is difficult to measure.

Moving in store or via the telephone makes attribution much more difficult. Targeted testing for geographical uplift in sales may require big levels of spend to definitively assert an offline impact.

Understanding viewability

Are ad impressions brand-safe, viewable and delivered to human traffic?

Private marketplaces allow brands to be certain about what they're getting, from a premium publisher, but this approach is more expensive and doesn't deliver the same reach.

Advertisers need to do everything they can to inure themselves against high levels of ad fraud, by shoring up their contracts and doing their own monitoring with a third-party tool.

Ultimately, viewability may correlate with cost.

Then, of course, there's ad blocking... 

Developing in-house expertise

A skills gap exists because programmatic is still relatively new, meaning a lack of experience in the jobs market.

Employing people with transferrable skills, who may have worked in search, for example, is one option, in the absence of display expertise.

A post on LinkedIn from Will Ashton of Hatch offers some sage advice on upskilling in programmatic:

We made sure we documented our channel learnings religiously, and developed quality new hire training and onboarding procedures.

We employed strong managers who were able to guide new hires through the steep learning curve. We gave people ownership of different areas and encouraged testing and innovation.