A Round-Up on The Latest in Ad Tech
The article discusses how programmatic advertising, despite concerns over transparency and bot-driven impressions, is evolving through advanced machine learning and first-party data to improve measurement of return on ad spend (ROAS) and customer experience, while urging brands to demand accountability from ad tech vendors to ensure genuine human engagement amid the phase-out of third-party cookies and Apple's Identifier for Advertisers.
Programmatic advertisers have been asking for more transparency and accountability from ad tech vendors for years.
Last year, ISBA and PwC found that as much as 15 percent of advertiser spend couldn’t be sourced. Despite this, advertisers in 2020 needed the flexibility that programmatic offered, so programmatic purchasing increased.
As the ad tech industry plans to say ‘bye’ to third-party cookies and Apple’s Identifier for Advertisers, how are ad tech leaders planning to accommodate an increased need of automated advertising, sans the digital thievery?
Machine Learning and First-Party Data Will Drive Return
Machine learning has been used to facilitate programmatic advertising for years, but its first-party data capabilities are advancing.
“A prerequisite for success in autonomous advertising is to have an accurate way of measuring ROAS, online as well as offline,” explains Chief technology officer at Viant, Fabrizio Blanco. “This requires a platform built on people-based advertising, which uses first-party data to connect devices and actions, both online and in-store, to the identities of real people who own those devices.”
Machine learning will enable brands to use first-party data (online and off) to focus more on the entire customer experience, rather than just impressions or clicks.
Brands Need To Take Responsibility for Ad Tech Vendors’ Services
Marketer and professor, Dr. Augustine Fou, brings up a big point of concern. Companies, like P&G, Chase, and Uber significantly decreased their spending on digital, and saw no change in business outcomes. Is this because digital advertising doesn’t work, or is something else going on?
The problem, he argues, is that the vast majority of impressions and clicks are still from bot activity.
He says that advertisers need to ask their vendors to prove to them that ad impressions are actually taking place—with real humans. If they can’t, brands need to take things into their own hands. They can run experiments by turning off their digital spending for a set time period and analyze the result on business outcomes.
Packaged-Goods Marketers Have New Alternative to Cookies
Verizon Media reached a deal to use Catalina shopper cards for programmatic ad buying. This will form a demand-side platform powered by offline and online sales data from Catalina’s 236 million shopper cards, all without cookies.
“Verizon Media has a very strong first-party identity graph that is tied to hundreds of millions of users and content that’s very rich, ranging from the likes of Yahoo! Sports to TechCrunch and finance,” said Verizon Chief Business Officer Ivan Markman to AdAge.
This DSP will be used for programmatic advertising, but also out-of-home and connected TV buying.
Related
How the Pandemic is Impacting AdTech
The pandemic, combined with regulatory changes like Google's cookie removal, CCPA enforcement, and iOS 14 privacy updates, initially caused advertisers to pause spending and delay payments amid surging online traffic, but programmatic advertising demonstrated resilience by rebounding quickly due to its flexibility, with overall programmatic spend rising 11% year-over-year from April to July, although investment varied widely across sectors—education and training increased spending significantly, while travel faced severe cutbacks.
Which New Advertisers are Using Programmatic?
Despite ongoing industry uncertainty from Google’s cookie replacement decision and increasing privacy restrictions, ad tech stocks like PubMatic and The Trade Desk are surging as new programmatic advertisers embrace opportunities in connected TV, identity solutions, and retail media, with leaders viewing these changes as beneficial for the open internet’s future.
Ad tech Companies Prepare for a World Without Cookies
Apple's introduction of App Tracking Transparency in iOS 14 requires apps to obtain user permission before tracking across other companies' apps and websites, significantly limiting targeted advertising by removing access to the Identifier for Advertisers (IDFA) and building on previous privacy measures like Intelligent Tracking Prevention, thereby forcing ad tech companies to adapt to a new landscape where most users likely opt out of tracking.
Publishers and SSPs Rethink Programmatic Ad Tech
Amid a predicted slowdown in programmatic ad spending due to economic uncertainty and declining budgets from major advertisers, publishers and supply-side platforms are adapting by consolidating and diversifying their partnerships with multiple ad tech providers, with significant year-over-year increases in publishers working with three or more partners to stabilize revenue streams despite overall market challenges.
How are Advertisers Spending on Programmatic as Cookies Depreciate?
As third-party cookies phase out by 2023, advertisers are increasingly experimenting with new programmatic advertising solutions like Google's Privacy Sandbox and Unified ID 2.0, focusing on leveraging first-party data, cohort modeling, and contextual analysis to maintain effective targeted advertising and campaign measurement in a privacy-centric digital ecosystem.
Which Categories are Adjusting Programmatic Spend the Most in July?
In July 2020, despite a 14% year-over-year increase in overall programmatic ad spend, many brands—especially in the tech sector—are bringing programmatic buying in-house to gain better control over first-party data and budgets amid pandemic uncertainties, while digital publishers are seeing recovering CPMs after initial drops, with some like Salon reporting a 25% revenue increase compared to the previous year.