In the 20 years since the first banner ad ran, the vast majority of ad tech innovation has been on behalf of advertisers, leaving publishers scrambling to keep up. Key among these innovations is programmatic buying, the stated buying process preference today among highly influential first-mover advertisers with large budgets. Smart publishers equipped with the right tools and information, and the bandwidth to take advantage of them, have an opportunity to thrive in programmatic environments. Identifying the right tools and accessing the pertinent information remain a challenge.
In July 2014, Index Exchange commissioned Forrester Consulting to evaluate the state of programmatic selling among publishers. Forrester developed a hypothesis that tested the assertion that the lack of transparency in programmatic environments and the sophistication of buyer systems limit publishers’ ability to monetize their inventory to their greatest advantage.
In conducting 13 in-depth interviews with senior publishing executives responsible for generating revenue through ad sales, Forrester found that these companies are keenly aware of the challenges that the lack of transparency forces upon them and the toll it takes on their revenues, marketer performance, and the ecosystem as a whole.
Forrester’s study yielded four key findings:
› Lack of transparency costs publishers much-needed revenue. Marketers judge campaign success or lack thereof based on publisher performance against a set of criteria. They typically don’t share those criteria with the publisher. Without that essential insight, publishers cannot adjust campaign execution strategies to achieve the necessary goals, which often results in diminished performance. And the result of that is lower CPMs the next time around.
› Lack of transparency also results in less than optimal performance for marketers. Marketers set out to be as effective and efficient as possible. They aim for success with every initiative. But because they deny publishers’ critical insight into campaign goals that would influence execution strategies, the result is often underperformance, which does not serve the marketers’ best interests.
› Transparency is in the best interests of marketers and publishers alike. When publishers are armed with complete knowledge of marketer goals, they can adjust ad campaign execution strategies to deliver the best performance to marketers.
› The rapid pace of ad tech innovation presents an ongoing challenge to publishers to stay informed and abreast of the latest trends and developments. A regular diet of industry-related reading, conference attendance, and conversation with vendors/partners helps executives across the spectrum stay up to date.