Publishers need to face the data challenge to benefit from programmatic trading
In economics, one of the key requirements for an efficient market place is the availability of perfect information, which needs to be timely, complete and available to all agents, so that products and services can be priced in an optimum way.
Looking at these requirements, I believe the advertising market is very good at providing two of these three elements in its current state. Programmatic advertising has enabled the market to access more information much faster than ever before and many agents in the advertising market have radically changed the way they use data to make better decisions.
However, what we are still lacking is to make this data available to all agents throughout the industry. In the current market, publishers do not have access to the information by which their inventory is priced and this leads to low prices for their inventory. Furthermore, there is a real lack of transparency in our industry, which is creating an imbalance between demand and supply as well as increasing market inefficiency with the rise in cheap inventory from the growth of programmatic.
This is commoditising publisher inventory and putting pressure on premium demand, not to mention increasing brand safety challenges and non-human traffic. There are three options for publishers to readdress this:
1. Publishers need to work with agents that allow them access to data to price their inventory better. Even better, they can work with people in the industry who can evaluate the value of their content and visiting audiences to drive pricing decisions.
2. Publishers need to work with the value chain to make their data available technically. Some of these options are private market places, and increasingly we feel data attached to individual impressions will be more elegant, comprehensive and valuable.
3. Publishers need to create some sort of uniformity of the information provided. This will create scale for the buy side, which is important as it drives significant uptake for this information.
There is no doubt that the programmatic trading of inventory has created better conditions for a truly efficient marketplace.
Publishers now need to seize the opportunities that programmatic offers, so that they can benefit from them as well as help make the market more efficient.
Alex Kuhnel, MD Europe, PulsePoint
Industry Insights features highly accessible and practical content from experts in the marketing services sector providing you with tools and resources to improve your business performance. If you would like to submit a report to the section contact email@example.com