Advertisers Look for Better Transparency Through Private Programmatic Deals

However, increased demand for transparency means that advertisers are beginning to turn their backs on open trading environments, such as open ad exchanges where real-time bidding (RTB) is used.

Instead, they are beginning to favor marketplaces where they can have better assurances over where their ads will appear by striking deals that can result in trading environments they are more comfortable with.

This can include direct deals between a media buyer and a supply source like an ad exchange or publisher, where they agree on trading a certain amount of inventory–either in terms of monetary value or inventory volume—but algorithms determine the precise media placements, a.k.a. “programmatic direct.”

Other examples include where a media owner selects its highest-spending customers to have preferred access to valuable inventory—or first pick on the most premium placements—in an environment known as a private marketplace (PMP) where trades are performed using algorithms.

These are just some of the findings in the latest eMarketer report detailing U.S. spending forecasts. It estimates that the vast majority of U.S. digital display ad dollars (86.3 percent) will transact programmatically by 2020, up from 82.5 percent this year.

In 2018, spend using programmatic direct in the U.S. will reach $27.47 billion, accounting for 58 percent of all programmatic display spending, according to eMarketer’s latest forecast.

Lauren Fisher, principal analyst at eMarketer, said such trends are driven by concerns over issues such as bad actors in the supply chain and the desire to activate their first-party data, which they don’t want to release into the open markets.

Overall, these concerns are not deterring the rise of programmatic buying, with many marketers now redirecting dollars away from the open markets toward more private, controlled setups (see above).

This includes efforts to take programmatic buying responsibilities in-house in a bid to gain more accountability from their programmatic trading partners.

“Advertisers will continue to favor the use of PMPs to activate coveted first-party data and other premium audience data that they refuse to release into the open markets,” continued Fisher.

“PMPs are a primary vehicle for enabling that audience data, all without having to commit to guarantees or upfront deals.”