Brand safety and measurement concerns fail to stem rise of programmatic spend
New figures from SMI show that industry concerns about brand safety and measurement have had little impact on the rise in programmatic spending, with investment in some sectors up between 500% and more than 2000% year-on-year.
Jane Schulze: “The rate of growth has not slowed”
Figures for the use of programmatic for the first quarter of 2017 compared to Q1 2016 showed a dramatic and continuing rise in programmatic spending through Australian media agencies.
While some sectors grew from a tiny base resulting in astonishing rises – with spending on cameras, recording devices and other digital products up 9,324% – other sectors which which were beginning to grow from mature bases continued to rise by over 100%.
Overall programmatic spending by media agencies rose 47.5% for Q1 year-on-year, to a total of $80.4m.
Programmatic spending on homewares and household fixtures and fittings jumped 588%, cereals and breakfast foods leapt 578% and internet services lifted 483%.
In dollar terms, the biggest spends were driven by supermarkets advertising food, alcohol retailers and shopping malls with growth for the quarter up $2.714m compared to the same time last year.
Movies, cinemas and theme parks also grew their use of programmatic, up $1.9m for the quarter compared to last year.
SMI managing director Australia and New Zealand, Jane Schulze, said marketers were continuing their investment in programmatic spend despite the publicity surrounding issues such as brand safety and questions about audience measurement.
“It’s fair to say, and the data bears this out, that the concerns raised by marketers about brand safety issues have yet to have any impact on the level of programmatic spending we are seeing,” Schulze told Mumbrella.
“The rate of growth has not slowed.”
Schulze said after years of rising spending in areas such as search and display, programmatic was now getting much attention from marketers wanting more value from their investment.
“The growth in programmatic is the highest of any digital sector and has been for some time, but keep in mind it has been coming off a very low base, it only started really a couple of years ago,” Schulze told Mumbrella.
“It is growing very strongly now and all the suggestions seem to be that will continue to do so.”
She said that the industry was beginning to get a view of programmatic spending.
“Being able to track spending is difficult enough, but overlay that with the fact that it’s not always a CPM-based buy any more, it’s a performance buy, a cost-per-click or a cost-per-view, so that makes it impossible for estimates to be anywhere near accurate and then overlay again the whole programmatic thing and you have got ads being sold via computers against huge numbers of different metrics.”
She said the new figures offered marketers veiwability of what marketers were really investing in programmatic by breaking down product categories to more granular levels.
While this an interesting take, I would question why programmatic has been called out as a separate channel in reporting? By doing so it’s easy lump all programmatic trading in the group of brand safety issues and immeasurability, regardless of channel or supply. Would it not be a more useful view to cut all media channels by the volume traded via a direct IO vs put through technology / traded in that channel’s version of programmatic? For me, talking about the growth in display (or video for that matter) now switching to “programmatic” is a misnomer as it is still display or video being bought, just the method of transaction which has changed. Appreciate this goes against much of the rhetoric at the moment, and isn’t as easy as a re-cut of the data, but to me would be a more forward thinking approach.
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