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Audience Targeting
April 16, 2015

Five Predictions For The Future Of Programmatic

#1: Companies will invest more in programmatic branding. With more publishers adopting programmatic and seeing its benefits, we’re seeing an important shift. Now, more marketers are leveraging programmatic to help understand the value of targeting a specific audience, as well as the impact of digital advertising on general brand attitudinal metrics.

I’m starting to see more companies invest in closed-loop campaigns that are optimized on traditional branding goals like brand favorability, brand awareness or intent to purchase. This type of measurement, coupled with real-time optimization at the individual level, will accelerate the amount of branding dollars that flow through programmatic channels. Brand managers will begin using programmatic to measure brand lift in the same way direct marketers measure conversion rates today.

#2: Marketers will become more discerning about data. Data is the fuel that propels all programmatic campaigns, but marketers are quickly realizing that not all data is created equal. First-party data, for instance, is far more valuable than third-party data, because you inherently know a lot more about it: how it was created, why it was classified in a particular way, and its recency.

For example, when it comes to retail data, shopping and transactional data more accurately predicts buyer intent than third-party behavioral data that you can buy off the shelf.

Because obtaining fresh, relevant data is so critical, more marketers will create custom audiences based (at least in part) on first-party data. Increasing ownership and accuracy of data both on and offline will create more value than buying targets from external parties.

In terms of corporate structure, marketing and data groups will collaborate much more closely, or may potentially merge into a single function.

#3: In-house programmatic: The desire is there, but roadblocks remain. For many CMOs, the thought of building a fully autonomous, internal programmatic team is still too daunting.

Because the programmatic industry is so new, the available pool of experienced candidates remains small and difficult to recruit. To get around that issue today, I see a clear strategy emerging, at least in the retail space: Choose your vendors wisely, and hire strong analytics talent to manage your campaigns and glean the right insights.

#4: Increased specialization will become the norm. I expect an increasing number of companies will specialize in either a specific format (such as video, TV or mobile geo-targeting) or an industry focus (such as travel or retail). Similar to how ad networks trended towards specialization over the past few years, these hyper-focused companies will innovate faster by concentrating on becoming a “best of breed” in their space. Programmatic will empower these companies to apply their expertise at a new scale and efficiency.

#5: 90% of all advertising will flow programmatically within a decade. Over the last several years, we’ve all witnessed a meteoric rise of programmatic mobile and video. TV will follow suit within the next few years. The millions of smart TV units flying off store shelves, and the increase in digital content consumption, will accelerate the shift towards programmatic. In fact, I predict that within the next decade, 90% of all advertising dollars will flow through a programmatic channel that’s paperless and tag-free.

Let’s face it: Programmatic is exciting, and it’s here to stay!

These are some of my observations based on my experience with this industry. Do you agree? I’d love to hear what you’re seeing in your business, and your predictions for the future.