Singapore – New research from WARC in partnership with ID Comms has highlighted the key trends across three different areas of programmatic advertising: the search for solutions in the post-cookie era, digital wastage in the programmatic supply chain, and the emergence of new addressable channels.
The report suggests that a majority of marketers and advertisers fall short in programmatic advertising with overlooked privacy regulation changes, digital ad spend wastage, and below average confidence towards data, analytics, and insight systems within emerging channels.
According to the report, about 58% of marketing leaders seem unaware of the impact of privacy regulation changes on their systems, tools, and business. In response, advertisers are actively seeking alternatives for targeting and measurement such as the use of first-party data, data partnerships, employing cookieless target methods, and exploring persistent identifiers as an alternative to tracking users across multiple platforms and devices.
Despite some improvements, the report states that nearly a quarter of the annual $88 billion spent on programmatic advertising still goes to waste. To reduce this wastage, advertisers include supply path optimization (SPO), wherein they streamline routes to advertising inventory by eliminating unnecessary intermediaries in the supply path. They also adopt in-house capabilities to enhance programmatic trading, and even engage in sustainability measurement, with some advertisers striving to minimize their carbon footprints.
Data also shows that CMOs report allocating a quarter of their entire marketing expense budgets to marketing technologies, yet marketers utilized just 42% of their martech stack capabilities in 2022, down from 58% in 2020.
Furthermore, there are new addressable channels such as gaming, connected television (CTV), programmatic audio, digital out of home (DOOH), and retail, but there is still a challenge as 62% of advertisers express only moderate confidence or less in their data, analytics, and insight systems. This confidence gap poses several obstacles to the expansion of these channels such as the need for holistic and standardized data, the pervasive issue of ad fraud, and the delicate balance between open web and walled garden Demand Side Platforms (DSPs).
However, the report mentions that marketers can still future-proof programmatic activations and improve business capabilities by establishing well defined business objectives, identifying and mapping one’s current capabilities, perform a gap analysis and identifying future business use cases, reviewing current programmatic maturity and future areas of progression, producing the final roadmap for their efforts, and activating their workstreams with the right support.
Paul Stringer, managing editor for research & advisory at WARC, said, “The efficacy of programmatic – automation, real-time measurement and sophisticated targeting – are being threatened by the growing push for data privacy and the demise of the third party cookie.
“While programmatic advertising may have failed to live up to its early promise, change is afoot and a new wave of growth and development beckons. In this report we explore key shifts across the programmatic landscape and how they are impacting advertisers,” he added.
