Mobile underscores need for personalization in programmatic
As more marketing spend and ad tech technology moves towards programmatic, the growth in mobile is significant, but ad buying still requires a human media buying component to deliver personalized, relevant ads.
The increase in programmatic and real-time bidding was one of the main topics discussed at the ad:tech San Francisco 2014 conference last week, primarily with the launch of AOL?s new One programmatic cross-screen platform. At the same time, marketers may not be completely ready to hand over the reigns to an automated system to handle all of their media spend.
?It?s not the Holy Grail to just run a campaign on real-time bidding, you also need to have someone sitting there at the desk and really looking at the campaign,? said Guillaume Lelait, vice president of North America at Fetch, San Francisco.
?There is always a human element to make mobile work,? he said.
Shift towards programmatic
AOL unveiled its programmatic platform last week that lets marketers and agencies buy video, mobile and display inventory in real-time.
The platform also gives agencies and media buyers a way to look at the analytics and metrics behind campaigns during and after they run.
IPG Mediabrands is the first agency to use AOL?s tool as part of a bigger plan to take 50 percent of media buying programmatic by 2016 in the United States. The agency also plans to roll out the same approach internationally.
Despite the shift to more automated buying, there is still a human element to programmatic that likely is appealing to brands and agencies, particularly on mobile.
The smaller size of smartphone and tablet screen sizes makes personalization more important on mobile than on other platforms, which cannot solely rely on machine-bought inventory.
Specifically, retailers and travel brands would likely benefit from programmatic buying as a way to bid on impressions that marketers know are the right customer because they have previously looked at a product or item.
?The word that we?re using a lot these days internally inside of our company, with our customers, is mechanization,? said Tim Armstrong, CEO of AOL, San Francisco, during a keynote session at the ad:tech San Francisco 2014 conference.
?Mechanization is essentially the human creativity meeting the machine scale and being able to do things at a much broader scale at lower cost,? he said.
Leveraging Big Data
According to Christian Galvin, sales director of the United States at Fiksu, Boston, there has been a sizable shift in moving more mobile budgets to programmatic buying in the past six to nine months. In some cases, programmatic can represent 25 percent of clients? spend.
The realignment towards programmatic also underscores how important targeting is becoming for brands since marketers are able to leverage big sets of data to segment with automated buying.
With the amount of mobile traffic continuing to grow, better understanding consumers' preferences through data could help push programmatic to the forefront of brands? mobile ad buys.
?Where it is today compared to ad:tech 2013, there has been a significant shift ? the needle is finally moving, and my guess is if we have this same conversation in 2015, we fully expect that programmatic may take over a majority of our clients? spend,? Mr. Galvin said.
The move towards programmatic also highlights the number of mobile advertising consolidations.
Last year, mobile marketing agency Fetch was buying mobile ads from 300 networks. Now, the company is working with 120.
The cut in ad networks is primarily due to scale and value, which are losing steam with both Facebook and Twitter gaining more marketing attention from big brands.
Yahoo is also looking to ramp up its mobile advertising business with new native formats and app install units.
Meanwhile, some mobile ad networks are struggling to build new experiences into mobile ads.
For example, Mojiva has closed its ads network and is now solely focused on ad serving, which Mr. Lelait said is likely due to the company not being able to differentiate its services.
On the other hand, ad networks xAd, Verve and PlaceIQ all hone in on location, which is appealing for marketers looking to layer in better types of data and targeting within their campaigns.
When it comes to companies that may be ripe for acquisition, Mr. Lelait said that Flurry stands out because of the analytical services that it offers developers and marketers.
According to Fetch?s Mr. Lelait, this shows the move away from static display ads to more contextual and native ads.
?There is definitely concentration of the ad spend towards the big guys like Facebook and Google,? Mr. Lelait said.
?Some of the ad networks that have just been buying through exchanges and not in a programmatic way I think are just going to disappear,? he said.