Communicate asked Roli Okoro, General Manager - Programmatic, Search & Social of OMG MENA, to outline the ways in which programmatic advertising is evolving.
What are the most important trends in programmatic advertising today and the ones to pay attention to in the near future?
Data privacy: The recent data scandals on the misuse and mismanagement of billions of users’ data caused much concern and led to new regulations. Public outcry led to legislations like the EU’s GDPR and California’s CCPA , [as well as] tech updates like Google’s plans to stop supporting third-party cookies and Apple’s move to protect users’ privacy by limiting tracking. As these have an impact on how we plan, buy, and assess our programmatic campaigns, we’ll keep working on alternative approaches.
Refocus on first-party data and contextual targeting: Without third-party cookies, brands will focus on their own customer base and first-party data to target audiences with relevant messages. They will also partner with publishers with quantifiable first-party data to serve relevant ads at scale. Contextual targeting, which places ads relative to the page’s content using page category, keywords, and semantics, will also be used as an alternative solution
AI and ML to improve bidding optimization: Both the pandemic and the digital privacy regulations have dramatically accelerated the use of artificial intelligence (AI) and machine learning (ML) in programmatic advertising. Digital advertising exchanges and platforms all use AI to regulate the purchase and sale of advertising in real time, while advertisers rely on it to optimize campaigns. This will continue to grow, with AI analyzing customer behavior, mapping user data with ad viewing metrics, or identifying buyer patterns accurately to place ads and cut the cost of customer acquisition.
Growth of in-game advertising at scale: The gaming audience exploded during lockdowns and yet remains a largely untapped opportunity. Mobile gaming is growing faster than console or PC. It’s even outpacing TV as the media platform of choice. 5G will accelerate this further, thanks to a better experience. Non-skippable ads in mobile games are a great opportunity, with programmatic combining the high engagement rates of gaming with first-party data to provide targeted, effective advertising.
Addressable TV and audio ads: New media habits emerged during the lockdowns and with them new opportunities for advertisers. Addressable/programmatic TV allows brands to target households in real time using live data and deliver relevant advertisements via real-time bidding on cable, satellite, IP TV, or on-demand/catch up online OTT services.
The same is happening with audio ads, with apps like Spotify, Soundcloud, and Anghami seeing an increase in audiences. These can now be monetized programmatically with data and insights about listener demographics and behaviors. Advertisers can create and target ads that align with their objectives, lower production costs, and deliver at scale. Budgets for audio ads, particularly in podcasts, are on the rise.
What do you think is needed to accelerate the adoption of programmatic on emerging channels (DOOH, connected TV, and audio) in the region?
Supply cannot exist without demand and there is increasing demand for innovation and multi-moment targeted digital executions that continue the dialogue between brands and consumers seamlessly across screens and devices. This is coupled with demand for performance through automation, real-time bidding, audience targeting, reach, affinity, and real-time reporting that allow ads to be tailored to individual consumers and served on the right screen/device, in the right location, at the right moment. Suppliers will have to adapt their product offering to meet with new programmatic solutions.
What are the main challenges to programmatic today?
Privacy regulations make it harder to build profiles of users across different websites, apps, and devices, and therefore increasingly difficult to serve highly targeted ads to users online. This also has an impact on the way we attribute campaign performance to media channels and minimize wastage by applying frequency caps to our ad exposure.
Programmatic advertising is a $200 billion global marketplace that is rapidly growing. This has given rise to privacy abuses and fraud, particularly in emerging media forms like connected TV and mobile.
Both have solutions though.
How do you advise brands or organizations to prepare for the post-third-party cookies (P3PC) world?
Remain compliant at all times: Clients must stay up to date with regional government and tech regulations. This also applies to every vendor/platform’s individual approach to these changes. Clients must understand all the options and solutions available to ensure their marketing strategies stay effective.
Build, analyze, and activate your first-party data: In a P3PC world, first-party data is the key to targeting individuals. Advertisers can use this to get to know their customers and prospects better. Understanding their habits, behaviors, and preferences will generate insights that inform marketing strategies.
Collaborate with partners with first-party data at scale: Looking beyond aggregated campaign performance, advertisers need to identify which publishers drive performance for their brand and combine their first-party data with theirs to uncover insights.
Look beyond audience targeting: Contextual advertising can be used at every stage of the consumer journey, including to serve personalized ads. Targeting household characteristics, together with bid-stream data such as time of day, location, and device type, will still be possible in a P3PC world.
Programmatic advertising is now a staple of marketing strategies. How do you see it evolving?
Faced with regulations and restrictions to protect digital privacy, advertisers will focus on their first-party data and contextual targeting instead. As consumer data will only become addressable on publishers with a first-party data network, those without one will struggle and need to deploy solutions like single sign-on (SSO). This will strengthen the dominance of walled gardens such as Google, Facebook, or Amazon.
Programmatic will continue to play a key role in e-commerce ad strategies. Businesses will use their first-party data to deliver highly targeted messages at each stage of the marketing funnel and enhance their customer experience.
As digital out of home (DOOH), connected TV, audio/podcasts channels continue to grow, programmatic advertising will allow businesses to reach their consumers at the right time, on the right screen/device with the right message in these exciting emerging environments.