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Advanced Ads: Complicated, Worth It

2017 could be inflection point for analytics, automation, panelists say 6/19/2017 8:00 AM Eastern

NEW YORK — Audience-based ad buying — using data analytics and automated buying, rather than simply age and gender — is still complicated, but its use is rising enough to reach a take-off point, experts from the “buy side” of the business said on a VIDWeek panel.

“We all need to do a better job of at least trying to incrementally walk certain advertisers down that road,” Brent McGoldrick, CEO of research firm Deep Root Analytics, said on the June 13 “View From the Buy Side” panel, part of the Programmatic Summit. His firm’s clients are split between consumer brands and political campaigns or organizations, he said.

McGoldrick said President Donald Trump’s victory in the 2016 election — which surprised most pollsters — pointed out the need for advertisers to reassess how well they know their customers or potential voters.

Jonathan Steuer, chief research officer at agency Omnicom Media Group, said that in six or seven years, it’s quite possible that industry observers will see 2017 was an inflection point for advanced advertising, though buying ads based on gross ratings points will still be the focus for many advertisers.

Even talking about “audience-based buying” means different things to different advertisers, Steuer noted. Two big Omnicom clients are McDonald’s, whose target audience is “basically anybody who eats through their mouth,” and SAP, the enterprise software firm that would love to influence perhaps 10,000 key people around the country. For McDonald’s, even ads that miss their target are still valuable; for SAP, most ads missing their mark won’t help as much.

Asked by the moderator, B&C business editor Jon Lafayette, for their forecasts of how big the advanced-ad side of the business will be in two years or so, McGoldrick predicted “probably in the 3% to 5% range” if the education process goes well.

Steuer said 3% to 5% sounds reasonable in a year, adding, “I think if two to three years from now that doesn’t look more like 20 to 30[%], there’s a real problem.”

Maribeth Papuga, executive in residence at BIA/Kelsey, noted that speakers at the Programmatic TV event were committed to making progress on audience-based buying. “What gets in the way is people’s business habits of their current quarter,” she said.

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