The US or Europe – who is leading the way in programmatic?
Back in 2010 when I started the European arm of VivaKi’s Audience On Demand, I had to turn to the US for everything. Half the companies I dealt with at the time had to turn to their data centres in the US just to make a bid, something that today would be impossible to imagine.
The US led the programmatic revolution, my own colleagues kicking things off in 2008. I was certainly wowed by the work going on in the US and the sophistication with which they approached this new and complex advertising technique.
Europeans often complain that Americans just don’t understand us. Having spent five months in the US last year, I realise that the reverse is also true. We just don’t understand the sheer scale and complexity of the US market either and because of that it creates more challenges for a single country than for Europe as a whole.
People would say without hesitation or doubt: ‘Oh so how is the UK, what are you, about two years' behind us?’ Frustrating. So often the opinion was based on scale, not sophistication, and the two are fundamentally different in a market like the US. As I consider my time there and compare it with the UK, I would say there are three primary differences:
Scale vs campaign sophistication
There are advertisers in the US who at times spend more individually than two major European markets combined. Daunting as it is, this type of scale drives innovation and startups. It powers research and learnings because budgets are so large that testing new technology and funding research is that much easier than in smaller markets. But take a narrower view of the work, the strategy, and this is where Europe starts to come into its own.
While scale equates to innovation on a macro level, smaller budgets often lead to more rigorous optimisation on a campaign level.
Let’s take something like centralising retargeting. In the space of about a year the UK revolutionised the marketplace. It was a marketplace where an advertiser routinely had 10+ ad networks and publishers each with a pixel on the advertiser’s site. They would happily retarget their first-party data, creating incredible internal competition and price inflation on their audiences as well as data leakage. This is like letting multiple companies bid on brand search terms. It would never be allowed in search so why in display?
UK advertisers realised relatively quickly the problem needed fixing – and it was fixed. The US is still pondering the complexity.
Vast agency networks across multiple cities creates an opportunity for publishers and media sellers to find money in any number of cracks. Policing spend and agency-preferred partners in the US is incredibly difficult. Say no to a tech company in one city, and they will pitch to your counterpart in another.
Europe appears to have a much better grasp on that process. With relatively smaller teams, overarching strategies can be put into play and monitored effectively. This may not be to the liking of some media companies, but it needs to be done to ensure best-in-class partnerships.
Invented in the US, adopted in Europe, private marketplaces (PMPs) are another of Europe’s success stories. The speed with which the UK alone created PMPs surprised my US colleagues and competitors. Building bespoke PMPs is now the norm in Europe to drive programmatic business. In the US there are still DSP providers without PMP functionality, which I find incredible.
At a dinner I attended in New York, publishers were bemoaning the lack of buyer demand. In Europe we see the opposite – publishers and agencies are driving an ever higher proportion of spend via PMPs and there is massive innovation as well.
La Place Media in France is a prime example, and another more recent is the global launch of Pangaea, the publishing alliance led by The Guardian but including FT, CNN, The Economist and others. This is not happening in the US, as most players consider themselves too large to need that kind of collaboration. I think this is a mistake as Google, Facebook and others are only getting bigger and stronger.
Agility and innovation
Things just seem to move faster in European markets. Ideas are put into action very quickly. Geography helps. When AOD launched in the UK, I would walk down Charlotte Street in London, dealing with just a handful of leaders. The same approach in the US spans as many as six cities, 10 agencies and an army of people.
This is not a criticism, it is a fact. Even when you have a well-developed idea, beta-testing is much quicker in a European market as you work with smaller teams who work next to each other.
Innovation is a hot topic and one that I think we lament when we look at the hotbed of Silicon Valley and the burgeoning New York scene. However huge strides are being made in EMEA with hot new companies emerging from Israel to Amsterdam and Moscow.
One continent awe-inspiring in scale and opportunity. One continent agile and swift. Operating in parallel? Formidable.
Marco Bertozzi is president of global clients at Publicis-owned VivaKi