Brands need to justify their advertising campaigns with conversion data—and even more so when there is a recession.
For this reason, brands are leaning on programmatic advertising in 2020. According to MediaRadar data, brands spent 11% more on programmatic spending between April and July compared to last year.
Industries are adjusting their programmatic spend differently—but programmatic is on the rise on the whole. What percentage of brands allocate a portion of their advertising budget to programmatic?
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Programmatic Rebounded Quickly
Though programmatic experienced a hit in April as advertisers quickly pulled spending and prices fell amid surging traffic, publishers are now seeing their programmatic dollars return.
The Ezoic Ad Revenue Index reported that the value of inventory was moving upward and exceeded last year’s values in June and July. “I feel like that’s a godsend compared to what I was expecting,” said CEO of Ranker, Clark Benson, to Digiday.
Brands lean on programmatic because of its efficiency and effectiveness—but it’s especially needed in a time when almost everything is done virtually. As consumers spend more time online, marketers rely on third-party cookies to target ideal customers with programmatic ads.
This is driving growth in the industry. The programmatic industry is expected to reach $98 billion in ad spend by 2021, making up 68% of digital media advertising.
Scott Tieman, global head of programmatic services at Accenture Interactive, said that changes brought on by the pandemic and the impact on ad tech will be long-lasting.
However, many brands recognize the disadvantages of programmatic when using an agency—such as a lack of transparency and control. In response, 69% of brands have brought their programmatic buying in-house instead of using an agency.
According to MediaRadar data, programmatic advertising is on the rise among digital advertisers.
At the beginning of 2019, 76% of brands advertising digitally allocated at least a portion of that to programmatic advertising. By Q2 of 2020, the percent of digital advertisers utilizing programmatic ad tech rose to 83%.
One thing that has not changed is the percent of programmatic advertisers who utilize adtech to purchase premium ad units (Native, Podcast, Video). In Q2 2020, 10% of all programmatic advertisers were buying the above three formats programmatically. In Q2 2019, 11% of programmatic advertisers were buying these formats programmatically—a 1% difference.
Among programmatic advertisers, the majority only spend on digital advertising. This was true last year, but it is even more true today. In Q2 of 2020, 84% of programmatic advertisers were only advertising using digital ads. Last year, 74% were only advertising digitally.
These changes reflect the virtual world we’re living in—where online schooling, shopping, events, news, and entertainment are now normal.
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