Reading Time: 3 minutes
confused businessman facing wall

US Programmatic display advertising spends continue to grow, but do you really know what you’re getting for your advertising dollars?

A3 Media has a traffic and accounting department intensely focused on verifying every media buy placed for our clients are delivered in full. But we are never content, constantly researching options and potential pitfalls. If your media buying agency isn’t constantly looking for better and more efficient options, should they be your media buyer?

We recently completed an audit of a client’s programmatic campaign and found the pacing to be flawless. A series of 30-day campaigns delivered a consistent daily average of impressions that were evenly distributed throughout day.

The urge was to dig a little deeper, so we set out to test restricted hourly delivery over a short test period and found the results to be anything but unacceptable. Without letting our national DSP know, we set up a seven-day test to monitor pacing. This test was agency funded; no client advertising dollars were used.

We started with a very small test budget, an extremely focused geographic footprint, and some dayparting. Sounds reasonably simple right? WRONG!

Our test delivery was to be restricted to a six-hour window. Almost immediately we uncovered flawed dayparting algorithms. With solid results from previous campaign audits, we anticipated an average hourly delivery of approximately 17% of the total daily impressions. After allowing the campaign to run for two full 24-hour cycles we found 100% of the daily delivery in the first hour of the six-hour window. Hmm? Unless there is a specific reason to do so, reaching your entire target audience in one hour is in no one’s best interest!

When questioned, after the usual volley of emails, phone calls, and explanations that just didn’t add up the matter was turned over to the DSP’s CTO for further investigation. The explanation was not acceptable.

We were informed our test scenario uncovered a flaw the DSP was unaware of. They claimed no other agency had previously used or tested dayparted delivery. Really? Huh? While we found that hard to believe, maybe the answer was no other agency was checking hourly pacing and only checking total impressions.

However, within 72 hours the DSP recoded their delivery metrics to accommodate evenly paced hourly daypart targeting. We tested it again and it was working properly. The question is, did they know all along and just wanted to make sure they could clear the money everyday or are other agencies just accepting results and not challenging their vendors?

In either event, the answer isn’t good.

This year, 2022 is projected to see more than $96.5 billion in programmatic display advertising. For DSPs and most agencies this is a win, they’ll get paid as soon as your ad is delivered.

But shouldn’t you know your advertising agency truly has your back and are working as hard as you are for your business?

One would think so…or hope so!

Reading Time: 3 minutes

In April 2021 Apple came out with an update that introduced ATT or App Tracking Transparency. The purpose of which was to return some control back to iPhone users, and give people a choice, to allow or not allow apps to track your activity across other companies’ websites. Apple’s company line is that they are doing this to improve privacy of the iPhone users and give them greater control over what apps were using to market products or services to them.

Built into the Apple operating system was a tracker called IDFA, (Identifier for Advertisers) which tracks your activity between applications. As more companies accessed that data, it became concerning to many about the access the apps had to this personal data.

As consumers became tired of seeing pop up Privacy Agreements at the bottom of the screens, forcing them to accept that the app used cookies to optimize your experience, Apple felt it should be at least a choice for the user and not a decision dictated to them. The ATT was initiated and delivered a choice to either let the App Track user’s activity or ask it not to track their activity. They even went as far as allowing users to go into the privacy settings and opt-out of tracking. This was good news for users, but bad news for advertisers trying to target their ads.

One example of the impact of this change was demonstrated when one store had been spending $27 in advertising on Facebook for every new customer they acquired. Since the elimination of activity tracking, they will be forced to spend $270 for every new customer added. What provides protections for consumers, drives the costs up for businesses to properly reach and add the same types of consumers, they reach before the change.

Apples new approach of ATT is important, when one considers the end to third party cookies in Chrome starts in January 2022. These actions on top of the governmental privacy regulations such as GDPR & CCPA, and as of November 2021 layered with Facebooks changes in ad targeting, will make for a more challenging ask of advertisers and agencies attempting to reach the correct potential consumers.

As part of the rebrand of Facebook with “Metathe company is removing targeting options like health, race, ethnicity, political affiliations, religious or sexual orientation beginning January 19th, 2022. It will take effect on all three platforms they control, Facebook, Instagram, and Messenger. In 2018, it removed 5,000 ad-targeting classifications to keep advertisers from excluding certain users. This effort to prevent discrimination, prevent ad targeting abuse and attempt to improve privacy has substantially restricted legitimate ad targeting methods. While the reasons behind the changes may be admirable, this leaves Digital and Mobile advertisers scrambling to find new ways to segment their ad delivery and provide the right ads for the right products and services reaching the right people.

So How Will Advertisers and Agencies Find the Right Path to Potential Consumers?

Apple’s introduction of ATT will make ads substantially less relevant for consumers, except ads delivered through Apple’s own personalized ad system. Apple Search Ads has displaced Facebook as the best ad network for mobile marketers on iPhone and iPad. Apple is introducing a measurement solution called SKAdNetwork (SKAN), which makes performance data available at the campaign level. SKAN is considered “differential privacy” which is the approach of using statistical methods for marketing measurement which make it impossible to infer and individual user’s behavior.

What can Advertisers and Agencies Do to Persevere Through These Challenges?
  • Deepen your understanding of your audience. Products that suffer most due to these identifier-based targeting methods are those with niche products. By building a broader appeal for your product or service, the more people that will be receptive to it and less targeted you must be in your ad segmentation.
  • Get more creative. The focus to develop new, engaging, and attractive ads can help minimize efficiency loss due to removal of the identifiers. As your ads reach the most important members of your audience, your products will break through the generic and non-descript advertising from competitors.
  • Increase Opt-In retargeting. Not all digital ads reach the right potential consumers, but by utilizing the reduced targeting categories of FB, Instagram or Messenger for your initial digital ad campaigns, while increasing the frequency of retargeting to those that have engaged or opted in with emails, you have limited your ad waste, and increased your chances of success since retargeting can lift ad engagement rates up to 400%. The average click-through rate (CTR) for display ads is 0.07%, while the average CTR for retargeted ads is about 0.7%. Those that engage with your re-targeted ads have a far greater likelihood of becoming future customers.

It’s imperative that every agency and company who uses digital ads understands the changes coming and the ways to succeed despite the changes.

Reading Time: 5 minutes

“Programmatic advertising is the automated buying and selling of online advertising. Targeting tactics are used to segment audiences using data so that advertisers only pay for ads delivered to the right people at the right time…”

The method of programmatic advertising is an auction system that puts advertisers together with online and/or mobile properties with available ad space. The method allows the highest bidder to A) target their ad to be viewed by different demographic & psychographic potential customers on websites and applications those consumers visit. B) It also allows the ad to go out in real time and limit the cost of the ad placement to just a fractional amount greater than the second-place bidder, the purpose of which is intended to minimize the cost per ad placed.

This method of buying and selling ads has worked out for some and probably not as well for others. On average, click-through-rates for Facebook ads across all industries is 0.90% and runs about 0.46% for Google display ads. Facebook and Google are making money selling ad space with the programmatic platform. Sadly, for many advertisers, just because an ad ran, and they paid for it, does not necessarily mean it was viewed.

Many folks saw the profitability and ease of buying and selling ads in the digital world and decided… “Hey, if it works for them, why not for us!”. So, they got cozy with people in the OOH industry who on average have as much as 30+% of the 340,817 billboards and posters in the U.S. unsold during any given month. That’s 102,245 potential units that could be sold, but often end up becoming added value or public service announcements, neither of which are generating revenue.

Those folks and a few of the top executes at the big billboard companies said, “well you can’t skip a billboard like you can a digital ad, maybe we should try selling this unsold inventory as the digital ads do, programmatically!” Lightbulb!

So, in 2012 Broadsign established the first programmatic OOH exchange and called it Vistar, based out of Canada, which had access to about 90% of the United States digital OOH inventory. Today there are all kinds of companies offering programmatic buying of OOH and digital location-based advertising inventory through self-serve platforms.

So, here’s the rub… This method seems to be a logical way to sell unsold inventory for OOH companies. Digital boards that have an open week here or there can be sold at the last minute instead of being left unsold, so the OOH companies are able to get something for the space. As they say, something is better than nothing.

There are three inherent problems associated with programmatic buying of OOH, and they are related to TIME, QUALITY, & MONEY:
  • TIME – One key benefit to using a programmatic platform is supposed to be the time the buyer will save in having to source RFP’s, dig through options and select and negotiate the best group of locations. Now a buyer must learn a new ordering platform, but once learned, the process might be faster by as much as 2-3 days. That could be significant savings depending on the size of the agency. The agency might save a few dollars in labor, but will this savings be passed onto the client?  The price determined through the bidding must still be agreed to by the OOH company, which means they still set the price at a level they are comfortable accepting. It’s possible the price might have been lower had the agency just bought the property through the OOH company directly bypassing the programmatic method and costs. The agency must still pay the price the OOH company will charge for the units, but now the agency must figure out how to offset the additional expense of the programmatic platform’s commission or decide to just add it to the client’s final cost. I suggest the cost savings to the agency will ultimately end up in the pocket of the agency and result in the client paying the same or higher pricing for less than prime OOH inventory. In this case programmatic buying won’t benefit the client.   
  • QUALITY – There is a reason that some billboards and transit locations are sold all the time and a reason the bottom 30% remain unsold. Its because the advertiser, either through an agency or through an in-house buyer has sourced the best options that fit its targeted demos for OOH & transit options and has bought those locations and units first. Typically, the first sold are the best options and selections. That means the rest of the inventory available to be sold programmatically are likely not the highest quality options to select from. If a buy is made through the programmatic exchange, the units must be available, and if available it’s unlikely that the same units would not be available to be purchased directly through that OOH company in the first place.
  • MONEY – As mentioned above in the TIME section, most programmatic buying exchanges, need to make a living too. They must either get those revenue dollars from the agency/via the client or kick back from the OOH companies as a percentage of the sales made through the platform OR BOTH. I do not begrudge any company providing a service or a product the right to make a living. What I believe and what our company does is always look out for the best interest of the client. That means we rarely would use a 3rd party company for any buying activity, unless that cost associated with the 3rd party could be justified and not increase the cost to our client’s bottom line. So far, we have not seen a platform yet in this country or in others, that allows for programmatic buying of OOH and does not also carry the baggage of one or more of the three inherent problems of Programmatic OOH buying.

What I believe and what our company does is always look out for the best interest of the client.

Let me be clear, programmatic OOH buying still has value in some cases. For example. If a client is seeking a GRP buy, or if it is trying to blanket cover an area in a short period of time or at the last minute, then this can be achieved with programmatic OOH campaigns. If an agency is short on actual human buyers and have been tasked with a large amount of buying in a short turnaround time, again this might be a good option. It is certainly a viable option for a very small product or service company that does not have a huge media budget but wants to make buys themselves.

It is certainly a smart move by OOH companies as its gives them another chance to make money on boards that are unsold or are typically hard to sell.

Not all methods of media buying are transferable to all other channels. In the case of programmatic buying of OOH, its important from an ethical perspective that clients are informed before any campaigns are purchased, meaning disclosing the advantages and disadvantages as well as the costs associated with the buying method. 

Reading Time: 3 minutes

We at A3 Media never stop looking for better ways to place and monitor media for our clients. We make it part of our daily routine because when you find a truly innovative partner with real accountability, the benefits for our clients can be the difference between failure and success, theirs and ours. And, while we haven’t heard them all we’ve heard hundreds of pitches claiming they have, “the most advanced system on the market for your needs.” In reality, newer and more advanced isn’t always better.

United States advertisers are projected to spend more than 289 billion dollars in 2022. Roughly 54% of those ad dollars will be allocated to digital advertising. More than 11 billion of all the digital dollars is projected to be wasted due to the widespread fraud in the digital space. This is out-and-out fraud, money spent that will never actually reach a single human. But it doesn’t stop there.

Digital media has always had its own standards. A “try to keep up with tech, as you go model,” in my opinion. There are many facets to placing a successful digital buy: the budget, the creative styles available, the creative quality, available inventory, and the list goes on. One facet – acceptable viewability standards – is the most baffling to me.

Nearly seven years ago, the Interactive Advertising Bureau (IAB) and Media Rating Council (MRC) created a standard definition of ad viewability – at least 50% of an ad must be in view for a minimum of one second for display ads and two seconds for video ads.

Compounding the IAB/MRC guidelines is the acceptable industry standard of 70% viewability! Seven of every 10 ads placed need to be at least 50% in view for ONE second, or TWO seconds for digital video. How much of an ad’s message can be gleamed by reading 50% of a digital ad in one second or watching 50% of a digital video for two seconds? Is producing an entire video that can deliver the brand’s message in two seconds possible? Does the agency ever explain this to their clients?

Does 70% viewability mean that a campaign can’t be successful? No! Does 100% viewability guarantee a campaign’s success? No, but it certainly increases your odds by 30%! However, what possible chance of success can be derived from the 30% of your digital ad dollars never being seen? That’s really easy – NONE! Yet publishers and agencies alike always boast about measuring their success against the industry standard. We often hear from vendors that they will “try” to optimize to 70% viewability. Our response is a resounding, “thanks but no thanks.”

If this is the model used for your media buying, the only potential loser is you – the client. Your agency is billing on a CPM (cost per thousand) impressions ordered, viewable or not. The DSP (demand side platform) your agency uses to place your buys charges on a CPM model – they get paid for every impression. The publishers and suppliers, SSP (supply side platforms) get paid for every impression they sell, viewable or not.

You can stay the course and hope your message reaches your potential consumers or, if this doesn’t sound like the most efficient use of your advertising dollars consider a few options:

  • Add 30% to your media budget to compensate for the nonviewable impressions and hope the additional spend gets the results you need.
  • Lower your bid rate by 30% so that you can increase your number of impressions. Although, this greatly reduces your chances of running and finding quality placements.
  • Ask your agency to look in to vCPM rates. Yes, the digital supply chain has gone so far as to offer a vCPM rate (viewable cost per thousand). The question that comes to mind first is where is the nvCPM rate, non-viewable cost per thousand?

Perhaps it may make more sense to work with an agency that refuses to jump on the bandwagon and work with superior providers. Choices do exist, non-skippable audio and video and above the fold (ATF), static digital ads, verified in demo, and geotargeted placements offer you a much higher chance of success than the current standards.

If your agency and publishers aren’t willing to guarantee nearly 100% vCPM, then ask them if it’s alright for you to deduct 30% of their costs and commissions. After all, fair is fair!