🍿 The microwave popcorn of media
Bragging about agency programmatic capabilities is a flex as strong as bragging about how good you are at microwave popcorn.
The popcorn market is awash with delish varieties: from the sinfully salty and indulgent buttery explosions to the virtuous no-salt and low-calorie alternatives. Even the cheesy temptations and unpretentious, plain popcorn have their loyal followers. But amidst this cornucopia of flavor sensations, does the person operating the microwave wield any power? Can the connoisseur's touch—or lack thereof—determine the ultimate deliciousness of the fluffy, popped kernels, transforming them from mundane munchies to irresistible mouthfuls of heaven?
I contend that many programmatic media trading teams are mere popcorn button-pushers—tossing in the packet, inputting the time, and robotically hitting START.
Some occasionally forget to take the packet out of the wrapper.
Some fat-finger an extra zero, setting off a 50:00-minute popcorn-popping smoke bomb instead of the customary 5:00.
Some regularly serve all the popcorn during the last 5 minutes of the movie.
Most have no idea how the microwave actually works. And some don’t know that popcorn is…corn and could easily be convinced to pay extra for the gluten-free kind.
You got a chuckle out of the popcorn metaphor. It is going to make sense in a moment. So go ahead and pop your email address in below to get future editions for free.
Did I really write 168 words about popcorn?
Yup. Sorry. Got carried away. Back to the show…
TODAY, we dive into the world of digital agencies and their shockingly undifferentiated programmatic media offerings.
Picture this: a roomful of digital advertising agencies pitching their programmatic capabilities, looking like a heated debate over which one makes the best microwave popcorn. See?! Nailed it. 🤜🏻
So, what's the secret sauce they're all raving about? Well, it turns out there isn't any. Or barely any.
The most successful biddable media agency teams are backed by highly knowledgeable, engaged, and in-the-weeds clients.
Otherwise, they all have access to the same demand-side platforms (DSPs) and ad exchanges. They employ large, junior-level teams who optimize towards KPIs that may as well be random numbers on a dartboard. The platform fees and take rates they work so hard to negotiate are so close, they'd make the head of a pin feel like a king-sized bed.
It's a sea of sameness in one of the leading activation channels for most brands.
Diving into the depths of their private marketplace deals (PMPs), we find massive inclusion lists containing thousands of sites and apps, with no way for humans to curate them all. It's like giving someone a phone book and expecting them to call every number.
And let's not forget Programmatic Guaranteed (PG) deals. While experiencing growth, they don't live up to the hype for most clients. The value of these deals is lost on brands seeking top-of-the-funnel reach and awareness. Instead, they're bogged down with high fees, overkill targeting capabilities, and unnecessary waste. They're as efficient as trying to water your plants with a firehose.
The connected TV (CTV) inventory in premium PG deals is often oversubscribed, commanding a price premium that only skyrockets once programmatic and PG deal fees (not to mention other ad tech fees) are added to the mix. At this rate, we might as well be burning money for warmth.
Some agency-holding companies attempt to differentiate by flexing their proprietary targeting data assets. Unfortunately, this can create conflicts of interest as they push their "owned" targeting assets onto clients while downplaying the margins made.
In the land of inventory delivery transparency, improvements have been made, but decision-making transparency remains shrouded in mystery. Ask why certain decisions were made, and you're more likely to get a deer-in-the-headlights look than a satisfying answer.
So, what's the conclusion? The programmatic space among ad agencies is generally undifferentiated. Instead, advertisers should focus on the quality, seniority, and experience level of the hands-on keyboard operators and strategists running the accounts. Don't expect the standard agency playbook with commodity staff and tools to drive incremental results.
However, you can find value by spending a seemingly disproportionate amount of time ensuring you have the highest quality staff on your business (and in-house). Brands that set the agenda and demand high standards will get the most out of their agency trading teams. It won't happen organically; it has to be driven by the client.
For example, when is the last time any of these topics were proactively brought to you by your agency?
Bid density vs QPS
Culling SSP’s to 2-3 per platform
Buying on an inclusion list only
Special unit vendors vs generalist SSPs
…to name a few. You need to drive these conversations as the brand otherwise, they will not arise organically.
Now, for those forward-thinking brands that want to extract the maximum value out of an otherwise commoditized programmatic operation, here are 8 recommendations:
Educate yourselves on the ins and outs of platforms, marketplaces, margins, backroom deals, and more. Knowledge is power, and armed with it, you can demand and drive the behavior you expect from your agencies. “I have an agency so I don’t have to worry about these things,” is a B.S. excuse.
Insist on regular performance reviews and hold your agencies accountable. This includes dissecting campaigns and understanding the decisions to optimize in flight and why.
Push for detailed reports on agency spending, inventory transparency, and the decision-making process, because no one likes surprises – especially not the expensive kind.
Encourage open communication and collaboration between your in-house teams and your agency partners. Don't let the agency operate in a vacuum; ensure they're connected to your broader marketing strategy and objectives.
Foster a culture of innovation by challenging your agency to experiment with new technologies, platforms, and approaches. Keep them on their toes, or they'll get as comfortable as a cat on a warm windowsill.
Invest in professional development for both your internal marketing team and your agency partners. This ensures everyone stays up to date with the latest trends, best practices, and opportunities in the ever-evolving world of programmatic advertising.
Vet your agency partners for ethical business practices and a strong commitment to transparency. A partnership based on trust and a bias for forward progress will break you away from the popcorn mob.
Set realistic expectations and goals. Don't expect overnight miracles; Rome wasn't built in a day, and neither is a high-performing programmatic campaign. Work closely with your agency to iterate and improve daily.
By focusing on the quality of hands-on-keyboard operators and strategists, demanding high standards, and following the eight bullet points outlined above, forward-thinking brands can still squeeze every last drop of value out of their programmatic partnerships.
Remember, the next time you evaluate programmatic offerings, don't get lost in the sea of sameness.
Now, if you'll excuse us, we've got a popcorn debate to settle.
This is a great piece that deserves a wide readership among advertisers. The only missing piece for me is the need to have the right contracts in place with the range of partners used and the right inspection/audit rights. If these are absent, there is a possibility that the advertiser may not see al the information they need, especially inventory media