Strong Programmatic AdTech Ownership Key to Winning the Battle of Differentiation
The Latest Study by ExchangeWire and IPONWEB Reveals 49% of Agencies Rely on Own Advertising Technology for Programmatic Media Buys and Improve Agency Performance
Tech ownership is key to building the right momentum to sustain credible success in programmatic media buying. In a recent research by ExchangeWire, in association with IPONWEB, a majority of respondents agreed that tech ownership drives performance and instills confidence in the customers to forge a stronger publisher relationship. A highlight from the report suggests that those who rely on their own technology to perform programmatic buys are more likely to see added benefits over a year. This is attributed to tech ownership providing a more aggressive field in pursuing their programmatic media buying and client offering priorities.
Understanding the Pillars of Programmatic AdTech and its Relation to Value-Based Partner Empowerment
The research report titled, “Agents of Change: The Rise of the Programmatic Media Agency”, manages to mine into the challenges and opportunities arising from the shift to programmatic media trading. The report also studied the impact programmatic media trading has on the relationships with clients and publishers, and how they are leveraging technology to create differentiation and provide new value to partners.
Publishers Search Programmatic Technologies for Media Efficiencies, and Measurement and Analytics, to Differentiate
Nearly half (49%) of all advertising agencies undertake programmatic media buying with their own technology, while 34% combine their own with third-party technology and 17% rely exclusively on third-party offerings. Agencies in EMEA lead the way, with 58% in the region relying solely on their own technology; this drops to 56% for North American agencies and 33% for those in APAC. It provides clear evidence of the benefits to agencies of owning and operating their own technology.
Asked to rate their performance across a number of programmatic tactics, agencies returned verdicts of very strong as follows–
|Programmatic tactic||Agencies using their own technology exclusively||Agencies not using their own technology exclusively|
|Campaign measurement and analytics||50%||18%|
|Measuring the incremental impact of media buys||48%||27%|
The importance of agency-publisher connections was also recognized, sixty-three percent of agencies using only their own programmatic media buying technology reporting major improvements in their ability to build relationships with publishers. This compares to 33% of those who do not exclusively use their own programmatic buying technology.
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Programmatic Ecosystem Knowledge
In addition, the ability to understand the programmatic ecosystem is a key differential, particularly in EMEA where 51% of all agencies say this is the case compared to 26% in North America and 33% in APAC.
Perhaps unsurprisingly, agencies who own their own technology (54%) were more likely to believe that this is a key differential than those that do not (41%).
Delivering on Targets
Agencies owning their own technology are revealed to be more ambitious when it comes to the targets they have set themselves for the next year. They expect their technology to deliver more, including combatting ad fraud, furthering omnichannel, improving campaign measurement, building customized algorithms for individual client buys and continuing to expand their relationships with publishers.
Discussing the research, Brian Fitzpatrick, General Manager of Demand Solutions at IPONWEB, said, “Agencies that own and therefore control their own technology stack have the competitive edge thanks to better performance across a range of programmatic touch points. Owning technology also gives an agency better visibility of clients’ campaigns, enabling them to drive up ROI.
Brian continued, “Owned technology also gives agencies the transparency across the ad tech supply chain that is increasingly being demanded by clients; as a result, they are better equipped to tackle issues such as the tech tax, ad fraud, viewability, and brand safety. And, as illustrated by the research, it helps agencies build the all-important links to publishers and inventory.”
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Cost Benefits of Technology Ownership
Despite the clear benefits of programmatic technology ownership, there are some roadblocks to more agencies taking this route. When evaluating whether to build their own ad tech stack or use a third party, agencies that do not currently exclusively use their own technology cite the cost of set up (71%) and cost of maintenance (67%) as the main deterrents. However, these reasons are also revealed as key considerations for agencies that opted to build their own technology, indicating that, with experience of both options, they regard owning their own technology as more cost efficient to use a third party.
Hugh Williams, Senior Data Analyst, at ExchangeWire, said, “Committing to any technology ownership is not a decision to be taken lightly. Our research with IPONWEB looks at the intricacies of the ad tech ecosystem from the perspective of delivering strong programmatic performances; it aims to enable agencies to make informed decisions about their modus operandi and subsequent investment.”
The figures are key findings of new research by ExchangeWire, in association with IPONWEB, which surveyed 129 professionals working in programmatic media at marketing agencies across APAC, EMEA, and North America. It goes on to reveal that agencies that take greater control over their programmatic technology achieve superior performance across a number of key media buying and measurement criteria. The research was conducted by ExchangeWire between 4 May and 2 June 2018.
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