NEW YORK: Achieving transparency in the programmatic media buying ecosystem remains a serious challenge for marketers, as a new report reveals widespread use of undisclosed buying agreements and significant lack of knowledge about how it works.
The study, Programmatic: Seeing Through the Financial Fog, which analyzed 16bn in-market programmatic transactions across seven participating advertisers and 30 brands, aimed to create an accurate picture of how client budgets are spent along the supply chain.
Bob Liodice, ANA CEO, said that the study – undertaken by the ANA, Association of Canadian Advertisers, Ebiquity, and AD/FIN – was designed to provide marketers with practical solutions for taking control of investment.
He attributed the encroaching primacy of programmatic to its offer of "targeting precision, scalability, cost efficiency, real-time optimization, and unprecedented leverage of big data for advertisers".
Yet many advertisers are not reaping the benefits of the channel, he said.
"Our study revealed that this lack of transparency makes it difficult for advertisers to manage, measure, and audit programmatic media investments with the same rigor as traditional media investments."
The report found that many advertisers are lacking adequate transparency around their investment to make informed decisions; similarly, few command a proper understanding of the economics behind programmatic.
This compromises their ability to manage the complex supply chain behind each transaction. Furthermore, the study discovered a lack of knowledge among marketers around the costs, trading fees, and performance details are necessary to meet internal requirements.
As a result, the report urged a demand for clarification, and disclosures of any and all conflicts of interest. In addition, advertisers should consider taking control of programmatic transaction data at the core of every impression purchased, and auditing and verifying the costs.
The report follows comments made last October at the ANA's Masters of Marketing, where Liodice urged marketers, especially CMOs, to take back control of their own industry.
"The current state is unproductive, unsustainable, and undesirable," he said. "CMOs can no longer let others do the heavy lifting for the industry."
The sentiment is becoming widespread. Writing for The Drum in March, Jane Ostler, Managing Director of Media & Digital at Kantar Millward Brown, argued that the stakes were now far too high to permit ignorance.
"Getting on the front foot means no longer treating programmatic as a shiny new toy – there's too much money, and risk, involved now."
Data sourced from ANA, The Drum; additional content by WARC staff