Programmatic has remained one of the hottest trends in digital advertising over the past five years, but the increased spending and popularity haven’t come without difficulty or controversy. The latest struggle is on the agency side, where many shops are sprinting to keep up with client demand, trying to integrate programmatic ad buying across their organization. This has not come easily, with many of the largest holding companies struggling to break programmatic out of a silo.
This is the kind of thing that intimidates smaller companies, who may feel that if the big international corporations can’t get a grasp on programmatic, then smaller agencies or media companies don’t stand a chance. In reality, local media companies (such as newspapers, broadcast and cable) and agencies will actually have a much easier time sidestepping some of these challenges to bring programmatic to their advertising customers.
The difficulty on the big agency side boils down to infrastructure. These companies have been assembled to execute ad campaigns in traditional ways, and programmatic is, in one way or another, disrupting some of the practices that have dominated the agency world for decades. Where in the past relationships were essential for every kind of media sale, today technology makes it so that advertisers can buy ads around the globe with a few clicks of the mouse. Agencies are struggling to determine where in their organization programmatic lives, who controls it, and how it relates to other parts of the company. Local media companies aren’t stuck with these legacy business models, nor do they have the barriers and internal politics that lead to confrontation or communication breakdowns. This makes it easier to bring programmatic into their organizations and in-house agencies.
This is also partly due to the type of advertisers they serve. Most small and mid-sized businesses (SMB) are not turning to their media partners and demanding programmatic technology, which is what is happening with Fortune 1000 advertisers and their agencies. The largest brands want the latest tools that will help them leverage their budgets most effectively — look at P&G’s ongoing effort to rid itself of middlemen and lower agency costs.
SMB advertisers are interested in efficient pricing, sure, but their main goal is simply to reach new customers. They want the opportunity to brand themselves and drive traffic to their stores and websites. If programmatic is the tool that does that, great. But it’s highly unlikely that an SMB owner or operator is going to care about the ins and outs of the ad tech that executes the buy, or the type of data used, or which vendor is used to filter out fraud. They want their ads to reach new and current consumers, and for those consumers to spend money with their business.
Amid all of the hype and industry conversation, it’s important to remember that programmatic is simply the latest means to an end. It’s great to talk about how automation enables audience targeting at scale for SMBs, but to get the SMB advertiser interested, this tool needs to be packaged simply. Rather than a heavy programmatic push, local media organizations and agencies simply need to educate their local market on how they can deliver new customers. Going too deep into the jargon and the technological bells and whistles is likely to alienate potential advertiser customers, who will feel that this product isn’t right for them.
Programmatic allows advertisers to work with their agency or media partner to buy ads across multiple sites, targeting the customers that the advertiser wants to reach. The advertiser doesn’t do all of work themselves, of course — the media operator or agency handles the technology on their behalf. This makes the SMB owner’s life easier, because they don’t have to learn a new technology, and they no longer have to negotiate multiple ad buys with different sites, as they would have if they handled all of their own advertising. Instead, they can launch an online campaign to reach their specific target efficiently, and they can do that without the mountains of CRM data and customer files that global brands have at their disposal.
Local media companies have the opportunity to integrate programmatic into their suite of offerings in a seamless fashion, even for advertisers than can only spend $500 on a campaign. If the results are positive, that $500 can grow into many thousands as the business grows and the advertiser sees the benefits of the campaigns. SMB advertisers care about reaching consumers, not the nitty gritty of technology covered in the ad trades. Local media companies and smaller agencies should focus on how programmatic technology helps them sell that outcome, rather than get stuck selling the technology itself.
Lynn Tornabene is CMO of AffinityX, where she leads brand strategy, corporate communications and marketing. She is also directly involved with all digital innovation as head of product strategy.