What effect has programmatic buying really had on legacy media?

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When programmatic exploded a few years ago in digital, it became instantly attractive to advertisers and their agencies due to its ability to replace mass advertising with more personalised communications. With data in abundance, more precise targeting allowed a message to reach the right person at the right time. However, there are downsides, around viewability, online brand safety and ad fraud.

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But what about the effect on other media channels?

As defined by the ISBA guide, (which is in the process of being updated) – programmatic is buying through automated means by setting up a campaign in an ad exchange or other automated system like a social media advertising platform. This can be contrasted to more manual buys where you or your agency are in contact with a sales team, or other ‘offline’ mechanism. Just to be clear: programmatic is a delivery mechanism for advertising. It is the process of automation for digital advertising.

There are three main options for advertisers looking to utilise programmatic as a process as detailed below:

  • In-house – bringing in the tech stack/people resources into the organsation
  • Employ a programmatic agency specialist
  • Use your current media agency trading desk (see guide for definition).

Now we have the definition out of the way, what effect has this type of buying had on legacy media?

Beginning with TV – still the best media channel to reach a mass audience. Programmatic has had minimal effect. The closest to programmatic, in linear TV, is Sky Adsmart, which allows different ads to be shown to different Sky households watching the same programme on linear TV as we know it. This model gives more control to the advertiser and allows more precise audience targeting.

Out of home is an interesting one. OOH is used more for mass audience advertising, but with digital out of home – while it may never be as personal as an advertiser may demand – the buying side is made easier with the use of programmatic.

Radio is perhaps a few steps ahead with the introduction of DAX (Digital Audio Exchange) created by Global Radio and now partnering with Xaxis, part of the WPP group. This model gives advertisers a single source for buying targeted ads at scale. Whereas previously the digital audio landscape was splintered, this process of media buying has increased efficiency, helping to leverage better use of data.

Programmatic for print is very challenging. Publishers translating programmatic methodology to the paper world face technological barriers. There is no way of knowing who or when the audience is buying or reading the publication, so programmatic, in this instance, has had no real impact. This would be one explanation as to why publishers are moving online. A prime example of this is the Independent moving to online only.

Cinema has a relatively captive audience (although some of the audience may turn up once the ads have finished). With the use of the right data and timing, programmatic can be used to target specific audiences, depending on film type and age classification.

Programmatic seems to be here to stay, despite a number of transparency issues. With such an aggressive growth rate, the UK is one of the most advanced nations in the world for serving advertising programmatically.

In conclusion, programmatic will continue to impact on legacy media in the months and years ahead. As the advertising industry as a whole continues to build on the vast data it has already accumulated, programmatic will increase in popularity due to the efficiencies it provides advertisers. The challenge is how the data will be used to inform the data-driven insights of tomorrow.

Mario Yiannacou is media and advertising manager at ISBA