If 2016 was the year of the header bidding wrapper for the publisher, it follows that 2017 may very well be the year of the Biddable IO for the marketer. Since programmatic emerged as a key buying channel for marketers, an inherent trade-off has persisted between the efficiency and data-driven decisioning of automation and the transparency and guaranteed nature of the direct buy. That compromise is about to disappear.
In a new white paper, “Automating Brand Spend: The Emergence of the Biddable IO,” we examine the trends that have led to the need for this new tactic. Leveraging data from a survey of over 400 publishers and buyers as well as insights gleaned from our conversations with key industry players, the report provides context for the evolving programmatic direct landscape, and introduces the new tactic that will revolutionize the marketplace: the Biddable IO.
The Rise of Programmatic Direct
Brands are beginning to realize the value of RTB-based auctions in increasing numbers, with many touting the benefits of efficiency and audience targeting as the main drivers of the shift. As technology and quality standards for programmatic inventory improve, more brands are moving in this direction, and premium publishers are chomping at the bit to funnel this spend towards their inventory. According to our recent survey, 83% of publishers considered programmatic direct to be an important strategy for their business in 2017.
We identified three trends driving brand spend to programmatic:
- The Proliferation of Header Bidding
- The Explosive Growth of Data Availability
- The Increasing Relevance of Attribution
In addition to providing an entre into automated buying for brands who had previously channeled their spend towards direct IOs, programmatic direct is also gaining popularity with the experienced programmatic buyers, as the digital advertising industry pivots back towards a focus on brand safety and inventory quality.
The Compromises of Automated Buying Channels
While providing increased inventory transparency and workflow efficiencies, existing programmatic direct channels require buyers to make compromises:
- Private Marketplaces (PMPs) provide greater visibility and access to inventory, but do not ensure priority placement within a publisher’s ad server;
- Private Marketplace Preferred (PMP-P) deals give buyers higher priority access to inventory, but do not contain the guarantee of inventory volume that the brands need for their forecasting;
- Private Marketplace Guaranteed (PMP-G) deals allow that guaranteed volume buy but does ensure the guaranteed placement access of the direct buy.
- Automated Guaranteed (AG), alternatively, provides buyers with all the benefits of the direct IO, but does not leverage the data-driven decisioning of programmatic.
The Biddable IO: The Solution to Close The Gap
Innovative buyers are starting to understand the potential that can be unlocked if they are to move their direct IOs to RTB with what we call the Biddable IO. Our survey found that 57% of buyers globally have either completed the transition of direct IOs to programmatic channels, or are in the process of moving them. The rapid adoption of header bidding has provided the foundation for greater brand access to programmatic inventory, and many are looking to take advantage of the opportunity. We believe that the emergence of the Biddable IO will signal a new era of digital media.