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Programmatic’s Dirty Little Secret

July 19th, 2016   ||    by Melanie Brown   ||    No Comments

Snapchat is the latest social media company to open itself up to third-party advertisers via an API. But the news surfaced recently that Snapchat’s ad exchange is also the latest in a string of high-profile companies (Facebook and Google, included) to pull the term “programmatic” from their lexicon.

Despite its developing status as a mainstream way of media buying, confusion still runs rampant in the programmatic advertising space. And that’s largely because each subset of the industry has its own guidelines for what constitutes correct practice. The problem with the term isn’t what it means, nor what it aims to do, but rather, what it connotes.

Negative Connotations

A recent Mediapost article, defines programmatic as “automated media buying that allows efficiencies of scale.” Though this definition differs only slightly from the IAB’s officially-sanctioned definition—”the automated buying and selling of inventory”—it illustrates the point that in the end, we’re all talking about the same thing. The process is designed to make media buying easier for buyers and sellers alike.

The fact that the process can produce usable data is secondary to the process itself, and the off-shoot of that is the audience insights, yield optimization and targeting efficiencies that the industry has come to associate with programmatic buying. And while the benefits of automated media buying are many, the boom of the past few years has also given way to concerns around transparency, fraud, viewability, and data privacy, to name a few.

Solutions, Anyone?

So the solution that ad exchanges and other tech platforms have come up with is to dissolve the term itself.

The term “programmatic” has taken the same route as many other trendy turns of phrase. Several years ago, when the industry was still in its nascency, the term came to popularity because the industry wanted to move away from terms like “remnant inventory,” “real time bidding,” and “auction-based.” In a twist of irony, one of the terms that Snapchat chose as a replacement is, in fact, “auction-based.”

Once automation of TV, OTT video, mobile and digital-display buys started proving itself as viable within the advertising industry, it was quickly named the new direction of marketing and advertising. That still holds true—the efficiencies and insights that automation provides are hugely valuable for marketers—but the problem with the term arose from the fact that companies started jumping into the space with data applications, tech platforms and semi-automated processes calling themselves programmatic.

At this point, the term has had so many lives and so many meanings, it’s been hard to keep up.

So let Snapchat, Facebook, Google and all those other exchanges out there shift their verbiage. Here’s the bottom line: At the end of the day, no matter what you call it, it’s all about making media buying smarter and simpler.

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