Monthly Archives: October 2017

Programmatic Advertising should be Slave to The Brand and Performance

“Programmatic is gluten of advertising”

-Jimmy Kimmel

I was speaking couple of weeks back at Marketing Interactive Performance Marketing Confence. It was a really great event and I was happy that I was able to speak from creative angle which quite often gets neglected in programmatic discussion.

Marketing-Interactive Digital Performance Marketing 2017

Marketing-Interactive Digital Performance Marketing 2017

I talked about the state of programmatic, but as in this post I want to highlight three things from the speech that every brand should take into account:

  1. Creativity has to become more ingrained to programmatic advertising.

Creative variables constitute over 50% of programmatic effectiveness, but do you focus 50% of your programmatic efforts to the quality of creative? Over half of the marketing budget is at stake and still many brands are cutting corners when doing creatives to programmatic. Horrible quality will lead to bad performance and will also contribute to ad-blocking (which has exploded in Asia) When same ad reaches person over 40 times a month, sales can actually start to decline.

Also sometimes it seems that programmatic specialists have totally forgotten the importance of strong brand. You can optimize as much as you want, but if people do not recognize and know your brand that tactical tweaking amounts to nothing. Marketing automation will not replace the value of strong brand. And strong brands are built from great user experience and emotional connection.

  1. Programmatic quality will be the utmost importance.

10.9 billion will be wasted on low-quality display ads by 2021. That is over 1/3 of programmatic spend. Above-mentioned creative quality is important element in the quality, but there has been even more fundamental problems within programmatic industry:

  • Viewability (or lack thereof)
  • Ad and click fraud
  • Bots
  • And the poor creative quality (mainly horrible quality and invasive display ads have driven people to block all advertising

Many have been benefiting from ad fraud, whether they have been publishers, buyers and media agencies. Hell, even extremists have done 318K from brands with ads placed to their extreme content. Who have not benefited at all from ad fraud?

Brands and their consumers.

Within the next decade, fake Internet traffic schemes will become the second-largest market for criminal organizations behind cocaine and opiate trafficking. Media (and other) agencies would likely not push dope (maybe consume it) or kill people but they have been happily working indirectly with same criminal organizations.

Industry has to clean its act.

Luckily the quality has become a conversation topic and brands start to realize that if your placement is too cheap it is probably too good to be true. Industry giants are improving as well. Programmatic direct deals in APAC have grown more than 65%. It is everyone´s responsibility to demand and offer quality placements.

  1. Programmatic is not just display advertising

I think it’s a dying industry. The idea that buying a 250 x 250 square display ad is effective, is false, you’re more likely to get bitten by a shark than click on one of those ad units.

– Matthew Oczkowski (Cambridge Analytica) 

Display ads will not be remembered as the best advertising innovations in the world (unlike TV ads and search advertising). 60% of banner clicks are accidental and 90% of them are bots. You don´t need to be mathematician to realize that it is really small percentage of people who are really clicking. And the percentage is not really going up. The world´s first banner ad had 44% CTR and now we have gone to fraction of that (0.16% globally)

However, some are still clicking and they are still bringing results. Display ads are necessary transition for companies to drive performance and learn to operate programmatically.

Programmatic marketing is about machines buying, serving and optimizing advertising (any kind of advertising). Eventually majority of buying will be programmatic, because machines are doing it better than we are. There is probably certain iconic placements that will never become programmatically bought or sold, but they will be small minority. For anything else machines will do it more effectively, accurately and faster. This applies also to actual creatives. If robots can already beat people at GO, conduct entire orchestra or write articles, it would not be the biggest of challenge to create above-the-average display ads. And if you are worried about machines stealing your job, read below quote from this great and acclaimed thinker:

”If machines can do the job, it´s not really a job you want to do”

– Riku Vassinen

Programmatic is still unfortunately in stage of not having unified definitions. When having discussion with different stakeholders of programmatic, it feels like the old parable of blind men touching elephant from different angle. Your view of elephant is totally different based on are you touching its nose or backside. Same thing with programmatic. Some are talking about buying, some about tools, some just about display advertising, some about multiple creative variations etc.

We need to strip away the unnecessary “magic dust” surrounding programmatic and agree on basic definitions. Unfortunately, it has been tainted by snake oil salesmen, who actually benefit of having people confused about what programmatic truly means. They have been benefitting on making it more complicated and less transparent than it should be.

Because at its core, programmatic is a great thing. It is about reaching right audience with right creative on right context and with right price. So essentially it is what advertising has always been. Now we are just able to do it with more precision.

Programmatic advertising is not means to the end. It should always serve as slave that helps to drive stronger brand and better performance.

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Video Killed The Digital Star: 6 Key Online Video Trends

Last Monday I was speaking about the latest Video marketing trends. Visual storytelling will be more and more important and naturally video is the most important way to tell visual stories. Video is growing rapidly and currently there does not seem to anything stopping this rapid growth:

  1. Video just keeps growing

We are living in visual age. Picture tells more than thousand words and video tells more than thousand pictures. In next three years video will account 79% of all Internet traffic. Businesses are expected to spend nearly $13 billion on video marketing in 2018. Lots of the discussions about video is focused on entertainment, but we tend to forget that YouTube is the world´s second largest search engine. 75% of consumers believe that a video describing a service is important and 25% will lose interest if your company is not explaining through video.

  1. Catching the attention is more difficult than ever

1/3 of of all YouTube videos have less than 10 views. That is quite pathetic and showcases the wide gap between hits and misses. Within top 10 most watched videos in 2016, there was only one ad (Nike The Switch). Of all the top 10 most watched ads, half were actually Superbowl ads. You are not only competing with other brands, you are competing of the time of your audience.

  1. It is not mobile-first, it is mobile-only

Mobile video is growing 25%, whereas desktop video consumption is declining for the first time ever. People are already consuming video 36 minutes on their mobile devices compared to 18.5 minutes on non-mobile devices. This mobile shift will affect your video production: Have you thought about vertical videos?

  1. Consumers are craving for instant gratification

Unfortunately average human attention span has fallen below the one of goldfish, so not surprisingly 75% of consumers prefer video under 60 seconds. YouTube is aggressively pushing their 6 second videos, which is enough time to tell even world´s greatest stories (below is Hamlet):

  1. Video platforms are eying for the prime time

YouTube are evolving from dubious quality user-generated snackable content to full-blown entertainment powerhouses. YouTube has couple of interesting offerings: YouTubeTV (cable-free LiveTV) and YouTube Red (ad-free offering focused on music and content creators). Facebook has not exactly resting on its laurels and Facebook Watch provides original video shows.

  1. Video is getting more interactive and immersive

This quarter there were over 2 million VR devices shipped (ranging from no-frill Google Cartboard to top-tier Oculus Rift), but VR has not yet hit mainstream. It currently works well with events and gaming, but we have not yet seen the killer app (or device) that would break VR to become a household name.

Augmented reality is already more mainstream (with Pokemon Go last year and popularity of face filters in Snapchat and Instagram). New Apple ARkit will just keep on making Augmented reality more popular.

Based on the calculations by Credit Suisse, VR/AR market could become as big as the current smartphone market:

Screen Shot 2017-10-16 at 4.01.47 pm

Source: Credit Suisse

So in the future, you do not only need to consider what is your content angle with your video. You have to also consider the depth of interactivity and immersion you want to obtain.

In many ways digital marketing is becoming more simple. It is all about two things: performance and content creation. The latter is all about video creation and to succeed in the market place, you have to be master of video production as well.

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