Programmatic Is Returning to Its Prepandemic ‘Normal’ Levels

The travel sector is still struggling, but other verticals are spending big on marketing

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More brands are spending in programmatic after major downturns in April. Getty Images, iStock

Programmatic is on the rise since the advertising doldrums of the early novel coronavirus pandemic.

The number of advertisers running programmatic ads through the end of July is up 36% since January, and total programmatic spend between April and July is up 11% year-over-year, according to data from MediaRadar. Programmatic spend in April alone was down 9% compared to the beginning of the year, and the overall number of companies buying ads programmatically dropped 8%.

a line graph titled number of programmatic advertisers ytd

But that’s beginning to turn around, thanks to significant investment from technology, education and media advertisers, and despite continued declines in spend from the travel sector. Todd Krizelman, CEO of MediaRadar, previously told Adweek that travel advertisers accounted for nearly 10% of programmatic spend across digital prepandemic.

bar graph for percent change year over year in programmatic ad spend

The flexibility of programmatic has proven to be a double-edged sword. Since the strategy allows marketers to easily stop and start campaigns, ad-tech companies were hit hard in March and April when brands decided to pull back spend.

Now that many marketers have adapted their creative campaigns to stay-at-home life, spend is again flowing through programmatic channels, especially given the uncertainty around traditional media like television and out of home.

By Q2, 83% of advertisers diverted at least a portion of their digital spend through programmatic channels, up from 76% compared to the beginning of 2019, according to MediaRadar.

percent of total programmatic ad spend by industry bar graph

The world’s biggest brands are spending more on programmatic, too. Members of the World Federation of Advertisers are directing 41% of their digital media budgets to programmatic channels, up from 16% in 2016. 

Overall, programmatic is projected to account for 86.5% of total display ad spend by 2021, according to eMarketer.

Marketers are spending more on programmatic in a time of serious change. Lawmakers are calling for investigations into the practice, Google Chrome is phasing out third-party cookies in 2022 and Facebook is saying its audience network will be weaker due to Apple’s iOS 14 updates.

“Apple said there will be new features that allow users to block location tracking more extensively, and the system will include transparency tools to prevent apps from recording users without their knowledge. This is likely to have a large impact on the advertising industry and their ability to hyper-personalize with targeted ads,” said Krizelman. 

@andrewblustein Andrew Blustein is a programmatic reporter at Adweek.