The Programmatic Future Points to a Hybrid Model

There’s no doubt the media buying industry is aimed towards a programmatic future.

But with well- publicized issues surrounding media quality, safety and margins, many in the industry have questioned the role of how agencies should and need to be involved. 

Attila Jakab, Infectious Media's Managing Director discusses the hybrid model with Advertising Week.

Attila HeadshotIt’s been reported that some large brands, including P&G, are considering bringing their programmatic media buying capabilities in house.

A  recent survey by the ANA found 35 percent of brands have expanded their in-house programmatic media-buying capabilities and limited the role of outside agencies, up from 14 percent in 2016.

In our own research we found that 84 percent of advertisers want more control over their programmatic advertising, while 73 percent don’t believe that agencies accurately measure campaigns bought programmatically.

Despite wanting more control, 96 percent of the advertisers we surveyed see the need for agency help with programmatic.

A very small percentage of surveyed advertisers (1.4 percent) are currently managing their programmatic in-house. This suggests a hybrid model may become the norm in which responsibilities are split based on strengths between brand and agency.

Every brand team has different strengths and weaknesses across the array of programmatic tools. It’s important to do an audit of your current position to truly understand what you can handle vs. where you need help.

For example, one brand may have a strong analytical data team, yet doesn’t have the talent or knowledge for programmatic optimization. Or a brand that has built an optimization team internally but doesn’t have the strategic resource or supply trading team to support them. These are key skills that are worth buying in from a specialist agency.

Research also found that 84 percent of advertisers want more control over their programmatic strategy with transparency issues around financial and data being key concerns. Transparency is a key component of any programmatic program as it allows accurate measurement in comparison to other channels.

Brands should prioritize the suppliers who can provide the right level of transparency and should also request access to the reporting tools that your media buyer uses. While going through raw data requires internal analytical skills, it will help you better understand what is working and what is not.

 

"Be comfortable requesting a better deal from agency partners"

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In order for a hybrid model to work, brands should demand a tailored arrangement with an appropriate agency – selecting only the individual services that they need, which can be effectively integrated with their own capabilities.

Brands should be comfortable requesting a better deal from agency partners, revisiting contracts and inserting audit clauses, or switching to partners that grant full data access.

For agencies, its important to proactively address advertisers’ concerns by offering full transparency and working with partners that can effectively prove the value of programmatic.

The current traditional media agency model of doing business does have its flaws. But brands that try to bring everything in-house also face risks and challenges as they may not have the expertise and necessary technology know-how.

The future of brand/agency relationships should be a hybrid one that combines the best capabilities of advertisers and brands. The agencies that are open to this flexible, hybrid model will be able to build a more effective and sustainable working relationship with brands for the long term.

The future of the media agency is leaning towards a modular approach in which the agency has the capabilities the client needs but that brands need to understand their own strengths and where they need help.

 

Read the full article here.