Direct Publisher Buying vs. Programmatic Buying

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How the digital media landscape has changed…

Circa 2000, the digital media landscape was relatively simple. An agency only had to a few partners to pick from to execute their media plans:

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But today, the ecosystem is just a bit more complicated:

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The digital media game is no longer just about what sites your ad appears on – it has been democratized and is now more about how smart you plan, not about what inventory you have access to. Because now everyone has access to almost all the same inventory.

When you look at buying media through a programmatic platform vs. a direct publisher buy, you should weigh your options based on objectives, media strategies, budgets and more, as both strategies have their benefits and drawbacks.

Buying direct…

Direct publisher buying involves RFPs, human negotiations and manual insertion orders with each individual publisher that is desired on a media plan. This is how a typical direct publisher buy works:

 comScore indicates that a specific website over-indexes against our target consumer

- 60% of customers who view ad impressions there fall within our target audience

- A plan is negotiated and contracted, along with 10-15 similar publishers

Direct publisher buying has several key benefits to consider.

1. Guaranteed inventory: When an insertion order is signed with a publisher, the publisher is then held to delivering the contracted impressions within the flight dates negotiated. The selling point to this is the advertisers know exactly what will be running, when and where.

2. 1st party targeting and/or exclusive inventory: Some publishers do not release certain inventory or 1st party data to outside companies, including ad networks, DSPs and other programmatic platforms. While this is a small percentage of inventory and targeting, there are several cases where this inventory could be extremely advantageous for an advertiser to utilize. And the only way to do that is through a publisher direct buy.

But, at the same time, there are also some drawbacks and challenges to these direct publisher buys.

1. Costs: The majority of direct publisher buys are contracted on static CPMs. So, if your ad impression is contracted at a $7 CPM, but the impression only costs the publisher $2 CPM to acquire, the advertiser is still charged at the $7 CPM. In addition, publishers require a minimum spend threshold to create an insertion order. This can create strains on the number of publishers that can be contracted for a media plan and can also create strain on optimizations if the publisher is not performing well.

2. Your targeting & strategies are in a vacuum: Because publisher direct buys require individual plans and negotiations across each publisher, it can be very difficult to create a cohesive plan to reach the intended audience. For example, Publisher A has a Millennial Parent target where the age range is defined as 18-34, but Publisher B’s target only includes 25-34, which may make it difficult to reach the 18-24 target effectively.

3. Slow and manual optimizations: Because direct publisher buys do not run through a unified programmatic platform, each publisher has to be contacted individually about any needed optimizations, and the insertion order must be modified before optimizations can be made. Because of this, optimizations can often take 2-4 days before any changes are implemented.

Going the programmatic route…

Programmatic buying refers to the use of software to purchase digital ads. Using the above example of a publisher direct buy, the primary benefit of programmatic media can be demonstrated as such:

 comScore indicates that a specific website over-indexes against our target consumer

- Only 60% of customers who view ad impressions there fall within that target audience

- IMM buys an upfront premium placement on that website and only serves impressions to visitors that fit that target

- The benefit? A 30% increase in targeted audience reach

And programmatic buying has three benefits to consider as well.

1. Targeting capabilities at scale: Programmatic allows for purchasing specific audiences, not just websites, across a multitude of sites across the Internet. This allows us a large reach and a holistic view of user intent signals, rather than partnering with individual publishers, all with separate audiences and targeting tactics.

2. Efficiency: Programmatic media is managed by in-house traders that can make optimizations in real time. This takes into account all media channels and access to all data allowing for maximum efficiencies for clients.

3. Real-time optimizations: We handle all programmatic in-house here at IMM, so we make all optimizations in real time. This allows us to make smarter marketing decisions and not rely on post-campaign analysis, such as Nielsen data, to prove out results. This ultimately leads to better campaign results.

However, programmatic buying does have its drawbacks, too.

1. Largely non-guaranteed inventory: Because programmatic buying is primarily done through auction-based platforms bidding on specific audiences, the size of an audience and the number of advertisers bidding on it fluctuates by the minute. This can make it difficult to achieve your desired spend level if the target audience is too small, but it can be mitigated by expanding your targeting if an issue arises.

2. Exclusive inventory limitations: Because of the prevalence of programmatic buying throughout the industry, some publishers intentionally hold back some types of inventory or 1st party data elements. Even though this unavailable inventory is a small percentage of the total ad impressions available on the Internet, there are some use cases where this inventory is highly valuable and worth striking deals for directly with publishers.

But which type of buying is better?

In an ideal world, programmatic would be exclusively utilized to allow for the most advanced targeting and real-time optimizations. But the reality is that there are still benefits to doing direct publisher buys in some situations. Therefore, programmatic media should be used to achieve scale and efficiency, and publisher direct buys should supplement your programmatic buys to obtain exclusive targeting and inventory not available otherwise.

About Ideas Made Measurable!

At IMM, creating action isn’t just what we do — it’s who we are. Our agency is built to deliver full service capabilities while also delivering measurable results. Big data is the marketing buzzword everyone talks about but few understand. We are here to explain in plain English how data-driven, bottoms-up marketing strategies can help generate leads, drive sales and build your brand. We leverage the expertise of the staff at IMM, a data-driven, full-service digital advertising agency based in Boulder, Colorado.

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