Programmatic benefits publishers

23 September 2014

BOSTON, MA: Publishers are seeing an increase in ad requests and a growing use of high value ad formats via programmatic trading according to a leading mobile advertising marketplace.

Nexage reported that programmatic spend through its Nexage Marketplace was up 227% year on year and said publishers grew ad requests 192% while video inventory had surged ahead by 516%.

It attributed these stellar growth figures to three key trends, including a "massive shift" to mobile, the adoption of programmatic as the core trading model and an increase in brand spending in the premium segment.

For those publishers using private exchanges the returns were even better, as Nexage, which numbers Fox News and Mail Online among its clients, said they had experienced revenue growth of 718% during 2014.

"Premium publishers, agencies and advertisers are certainly rallying around mobile programmatic," said Ernie Cormier, CEO and president of Nexage. "But mobile programmatic is not simply a broad trend, it is a strategy designed to drive their businesses forward; a strategy geared to get results. And results drive action."

While few doubt that programmatic is the future for digital advertising, there are some questions over who exactly will be carrying it out. Sir Martin Sorrell, head of WPP, recently dismissed the trend for brand owners to bring programmatic buying in-house.

"It's a temporary phenomenon," he told CMO Today. "Our view is after a year or two it will change."

He suggested that ad buying was not a core competency for most organisations, never mind understanding and implementing complex advertising technologies. "I question whether [clients] will be able to apply technology successfully," he said,

But brand owners have opted for this route in part because of media agencies' reluctance to be transparent about the money they make on programmatic deals. Pete Mitchell, global media innovations director for Mondelez International, recently argued that programmatic was at a crossroads, where agencies could either charge clients an undisclosed margin and risk losing business or be upfront about it and build a long-term relationship.

Data sourced from Nexage, Wall Street Journal; additional content by Warc staff