What Programmatic Operating Model is right for my business? A question we at The Programmatic Advisory get asked a lot! When thinking about an operating model for an advertiser embracing programmatic it boils down ownership, whether that be technology, media, data or talent – where does the contract and resources sit to operationalize these areas effectively?
It’s become clear over the past few years that marketers want to license programmatic technologies themselves owing to a number of benefits; a better ability to inform product roadmaps from the technology provider around their specific needs, disclosure in all costs, greater governance over data, and bringing technology into an organization can be a great instigator for change.
There are however challenges to technology ownership; there is a very good chance the commercial agreements will be worse on paper than what had typically been procured through their incumbent third party, procurement teams within brands haven’t typically bought ad technologies before so need to work out what is a good negotiation quickly and oftentimes brands are unsure what technology is actually right for their needs so must enlist third party support.
Infectious Media's In-Housing Programmatic Report Found:
• 71% of advertisers believe agencies have struggled to adapt to programmatic
• 84% want greater control over programmatic advertising
• Agencies still have a role to play – with 96% of advertisers predicting a hybrid model
Over the years it’s become accepted that there are rebate practices within marketing whereby a buyer commits a certain amount of spend over a certain time period and receives a bulk of that back if the commitment is hit at the end of the year. Marketers have felt that this creates some poor media buying as they may spend with media partners which give them the largest rebate and not what is most likely to deliver business goals.
Many advertisers are starting to own major media relationship contracts (Facebook, Amazon and Google most notably, but also others), however, the advertiser is unlikely going to be able to structure beta tests, lower costs (where appropriate) and additional support where their buying power is less than major buying houses they may have used in the past.
Becoming data-driven is high on the agenda of priorities for marketers, many have taken necessary steps in better collecting their data and structuring it in a way that can be used for product development, CRM, on-site personalization and remarketing.
Many advertisers are running strict data audits to understand which third parties are collecting and potentially benefiting from their data and because of this we have seen the number of tags implemented onto advertisers websites significantly reduce.
Talent is the most sought after asset in marketing, there’s endless competition for highly qualified or highly experienced people. Marketers who are thinking about owning and operationalizing any of the above areas (Technology, Media and Data) need to consider whether they have a culture for talent to thrive and whether they are based in a location where that talent will want to travel to, without talent they can start sinking a lot of cost and will not make the most of what programmatic can bring.
There are options for talent; advertisers can work with agencies or consultancies to help deliver their ambitions as opposed to hiring in-house.
Advertisers need to be realistic about their desired operating model, there’s plenty to consider but once everything works in harmony it will deliver fantastic results and campaigns.
Article by Wayne Blodwell, CEO, The Programmatic Advisory.