Programmatic? Problematic.

Programmatic ProblematicAt the recent IAB Annual Leadership Meeting I took part in a town-hall style discussion called “Programmatic Buying from the Perspective of Premium Publishers: Value Creator or Advertising’s Borg?”  A topic like that can go one of three ways.  (1) It can turn into a festival of buzzwords and received wisdom; (2) it can quickly become a shouting match; or (3) you might just get a few little Easter eggs of clarity.  I, for one, was really delighted with the eggs.

There was some of the usual smarty pants technology stuff and more than a little bombast.  Each of four “provocateurs” (I was one) gave an opinion to which those in the room could react and respond.  And react they did.  There were strongly held positions, fear, misconceptions and strongly held positions based on fear and misconception.  Then a funny thing happened along the way.  The big point jumped out and revealed itself.  The only real problem with “programmatic” in the eyes of the premium publisher (aside from all the alliteration) is that we keep calling it “programmatic.”

The issue, you see, is the name itself.  In our efforts to slap a simple label on very complex set of topics, we’ve created a scary-sounding catch-all and larded it down with about a half-dozen unrelated and incompatible concepts.  It’s time to bury the term “programmatic” once and for all.  It’s become emotionally radioactive, it’s not instructive, and it’s not moving premium publishers and advertisers any closer to the automated nirvana we are supposed to crave.

In our discussion, there are really two issues here for the publisher:  automated process reform and dynamic pricing policy.

APR.   A huge part of what “programmatic” trading accomplishes is not controversial at all. It’s simply about automating the ‘send and receive’ part of what we do.  Why in the world would I not want to have my finely tuned, automated system receive the ads that your finely-tuned, automated system sends?  At its essence, automated process reform is simply about bringing machine-based precision to the act of trading ads for money.  Period.  Those who choose to geek out and conflate APR with RTB – real time bidding – are overreaching and doing a huge disservice to the industry.

DPP.  Once publishers have embraced APR – which eventually all will –they are then faced with addressing dynamic pricing policy.  Essentially, now that I’ve got the automated process in place to trade ads with precision, what business decisions will I make about pricing those transactions?  One legitimate decision may be to open up certain classes of inventory to RTB – or never to do so.  You may decide to withhold most or all of your inventory from second party sales channels – networks, exchanges.  You may use pricing policy or the blacklisting of certain advertisers to achieve your sales goals.  The point is, it’s up to you.  APR is not a slippery slope into RTB.  Never was.

For too long now, “programmatic” has been an intellectually lazy term; a sloppy construct that’s caused more problems than it’s solved.  Only by tossing it overboard and addressing its two central pillars do we move the development of the publisher’s automated future onto the fast track it deserves.