Real-time advertising is one of the hottest topics in marketing at present. In order to gauge how the industry is preparing itself to meet the challenges posed by programmatic advertising technology, The Drum teamed up with Quantcast to survey UK advertisers (both in-house and agency employees), and found a near-universal skills gap in the sector.
The disruptive nature of programmatic advertising technology is reshaping the industry landscape, challenging in-house advertisers and media agencies alike to fundamentally alter their organisations, plus the skills sets within them. The initial findings of the survey are that almost every sector of the digital media landscape is struggling to find talent with the adequate skills to both plan and implement, and in some cases also build the technology required for RTA campaigns. A
recent report by analyst firm Magna Global forecasts that by 2017, 59 per cent of all display media spend in the UK will be traded using RTA technology, further demonstrating the pressing need for better education about the technology involved. Rebecca Muir, Quantcast product marketing lead, explains that the motive behind the research was a theory within the organisation that lack of education over the processes involved in RTA has bred an unwarranted mistrust in the sector. She adds: “We also wanted to see what pockets of the advertising industry reported the least knowledge about RTA, as well as those that wanted to know more about it.”
Self declared ‘Skills gap’
An in-depth look at The Drum and Quantcast’s survey findings, based on the responses of 225 inhouse and media agency advertisers in April, reveals that agencies are investing more in RTA compared with advertisers (see chart 1). More than half of advertisers (51 per cent) who are running media campaigns in-house are investing between 1 per cent and 20 per cent of their budget in RTA, compared with 35 per cent of agencies. Meanwhile, 10 per cent of agencies invest between 61 per cent and 100 per cent of their media budget real-time advertising is one of the hottest topics in marketing at present. In order to gauge how the industry is preparing itself to meet the challenges posed by programmatic advertising technology, The Drum teamed up with Quantcast to survey UK advertisers (both in-house and agency employees), and found a near-universal skills gap in the sector. in RTA, but no advertisers are investing a similar proportion of their budgets in the technology. Muir says: “It’s natural that agencies are taking a lead in RTA, as they have been running display campaigns before programmatic advertising even came around. But one thing we are starting to see is that brands are increasingly starting to take an interest.” There are countless theories as to why media agencies are more eager to respond to the rapid emergence of RTA technology. One popular theory is that the threat of disintermediation – as advertisers begin to explore RTA in-house – means they have to prove their expertise in the field in order to remain on their clients’ media plans, by providing greater clarity on how to employ this technology. This theory has been backed up by two key findings in the survey. Nearly half (46 per cent) of agency respondents claim they feel they are investing enough in RTA, but only 14 per cent of advertisers running media campaigns in-house feel they are investing enough (see chart 2). Meanwhile, more than half of advertisers running media campaigns in-house rate their knowledge of RTA as ‘very weak’, or ‘weak’, while less than a quarter (22 per cent) rate their knowledge as ‘strong’, or ‘very strong’ (see chart 3).
Advertisers Unaware
ISBA, the UK trade body for advertising brands, has made efforts to help guide its members over best practice within RTA space over the last 12 months, as members increasingly explore the potential of the technology. David Ellison, ISBA marketing services manager, explains that some in-house advertisers, such as P&G and Unilever, have already decided to set up their own RTA trading desks, to try to remain “one step ahead”. But there are also members who are at the stage of gathering information and insight to make a decision as to whether they want to get involved in RTA. He adds: “The reality is that there is still a large proportion of brands that are unaware of what is an increasingly important part of the digital eco-system. The industry’s challenge is to spread awareness about RTA so advertisers can get the most out of it.” This confusion – or in many cases ‘distrust’ – of RTA among in-house advertisers is further demonstrated in a recent ISBA survey, which noted that only a third of its members admit to having a ‘positive perception’ of employing RTA technology. However, The Drum and Quantcast’s survey findings subsequently reflect how media agencies are eager to allay client concerns by building a body of expertise within their own organisations, and provide greater transparency on how RTA campaigns are implemented. For instance, more than half (51 per cent) of agency staff surveyed rate their knowledge of RTA as ‘strong’, or ‘very strong’, with only 21 per cent rating their knowledge as ‘weak’, or ‘very weak’, according to the survey results.
The Changing Face of Agencies
Paul Frampton, CEO of Havas Media Group UK, which operates its own RTA trading desk, Affiperf, reveals how his outfit has elected to adopt a collaborative approach to employing RTA technology chaRT 3 chaRT 4 with its clients, by explaining how the processes operate. He says: “Lots of clients are interested in having these conversations [about RTA] … [For media agencies] this involves moving to a solution-based consulting model, and away from the old mediabilling model.” Frampton adds: “In the last six months we’ve gone through a huge change in client director teams by appointing ‘digital first’ people to head them up, as well as hiring people with backgrounds in risk analysis, etc. You need people with a good grasp of maths that are comfortable with modelling data, applying it to marketing, and then explaining it to clients.” However, as the survey results reveal, such talent is difficult to come by. All subsets of respondents (agency staff and in-house advertisers) reported that they find it difficult to hire new people with the right skills. The findings show that 74 per cent of agency respondents claim it is difficult to hire new people with the right skills set, with about 65 per cent of in-house advertisers claiming likewise (see chart 4), hence the need for a more universal education around RTA is clear. Quantcast’s Muir explains that the results back up her own experiences of dealing with both in-house teams and advertisers. She says: “A lot of people I speak to say that training is difficult, and in many cases the only places they have to turn to are advertising technology companies themselves, and the problem with that is they often receive that particular company’s training programme [which is bespoke to their own platforms].” What is needed is a more impartial method of training, she adds.
Conclusion
Fundamentally, the purpose of using RTA technology is very simple: to make advertising budgets perform more efficiently. This involves using software to mine data sets, with the aim of putting ads in front of relevant audiences across the internet. The effectiveness of this is then measured using conversion rates to help prove return on investment. But jargon-heavy phrases such as ‘real-time bidding’, ‘data modelling’ and ‘bid automation software’ are spreading confusion over this process. As shown by The Drum’s survey findings, UK digital media professionals have not had adequate access to education over the emergence of RTA, leaving a gap in their digital skills set. This is especially evident within in-house advertising teams, indicating that media agencies are likely to lead the way in employing such technologies.
This feature was originally published in the 23 June edition of The Drum magazine, available to buy through The Drum Store.
