Programmatic Advertising: Lessons Learned from First Movers

By Barbara Manley, Director, PwC

We've all heard it: The promise of programmatic advertising to improve efficiency through automation, and to improve campaign effectiveness through more precise targeting and real-time analytics.  To fulfill this promising marketers and advertisers need to navigate and master a complex set of new tools.

During the last several months PwC has had the opportunity to speak to over 30 different agencies and marketers about how they are approaching the complexities and prioritizing challenges of programmatic advertising. Several key themes emerged from our conversations about their strategic priorities.


"The nirvana would be to integrate data and own it all" - US Marketer

Data ownership is critical to most of the marketers that we talked to.  Not surprisingly there was almost consistent interest in maintaining ownership of first party data.  Unfortunately, struggling to figure out how to approach and integrate third party data was also a consistent theme. There is concern about the consistency and quality of third party data and yet, also strong interest in any opportunity to enhance existing data with external sources.

"3rd party data is not always great, expensive and not always on time" - US Agency

In-house capabilities and operating models impact how most marketers integrate customer data.  The 'build vs. buy' decision regarding the DMP (Data Management Platform) is strongly influenced by in-house technical capabilities.

Programmatic advertising requires a suite of different technologies working together to be successful - from the ad exchanges, and bid managers, to campaign managers and creative solutions.  And that is just on the buy side!  Making sure these tools - the so called Ad Tech Stack - all work together and talk to one another is a critical and fundamental step in a successful programmatic advertising program. The easiest way to do this would be an integrated stack, a single suite of tools designed and built to operate together.

Most marketers we talked to see the vision and understand the benefits of a vertically integrated stack.   Chief among those benefits are ease of integration, efficiency, and data integrity. If that is ad tech nirvana however, most marketers are not willing to make compromises in other areas to achieve it.  One of the primary challenges marketers see to a single integrated stack is the absence of a single "best of breed" provider across all ad stack components.  Today, most marketers seem to prefer a collection of "best of breed" components and accept the technical challenges that come with that.

The existence of 'walled gardens' is also forcing marketers to step away from the nirvana of an integrated stack.  'Walled Gardens' exist when a media company limits how advertisers can access inventory.  These walled gardens have forced media buyers to implement multiple DSPs (Demand Side Platforms) to access the breadth of inventory that they want.  Many of the marketers that we talked to selected a primary DSP to give them access to broad audience and then they selected supplemental DSPs to access niche audiences in mobile, video, or specific geographic regions.

Eighty percent of our survey participants rated "Ease of integration with ad tech tools from other vendors" as either a 4 or 5 (out of 5, 5 = Most Important) with only "Access to top digital inventory, publishers, and web developers" outranking it. The lesson here for all of us: limit the number of DSP's that you are working with. Keep the environment simple. Limit your headaches and costs.

Analytics is the secret sauce that makes programmatic advertising work.  As we have talked to marketers, this theme was repeated over and over.

"This is a very important area for us, we use all the analytics that we can."

The desire for more analytics and deeper insights seemed to be about where the commonality stopped. Companies are taking a variety of different approaches to analytics and have different preferences for where they want to go to get deep insights.

Marketers and agencies will always welcome insights/analytics based on high quality, user-specific data (e.g. logged in data) owned by the media companies themselves. Advanced insights and analytics performed with data beyond reach would be valued from media companies.

Marketers have high expectations of their technology providers.  In many cases, they expect the technology providers to be the experts.  In other cases, marketers continue to work with their agencies and expect them to be the experts.

"The more explanation/detail on how campaign is performing is key. Preference is to have the provider be the expert..."

Partnerships are being established with analytics providers to shift from traditional research/targeting (male vs female) to audience/behavioral based segmentation to improve targeting

In conclusion
So while all the world is a buzz with hope and high expectations for programmatic advertising, be sure to focus on the fundamentals.  The fundamentals - data, technology, and analytics - will enable you to be successful with the capabilities that exist today.  And give you a strong foundation to build on, as programmatic continues to grow and expand.

About the Author
Barbara Manley is a Director in PwC's Advisory Consulting practice with over 20 years of combined consulting and industry experience. In this role, Barbara specializes in the design and execution of customer digital solutions to address disruptive market and industry forces. She is a seasoned executive with a track record of delivering business value and driving change.

Barbara has a broad range of experience across industries. She brings leading practice knowledge, skills and experience in commercial strategy, development and adoption of new business models, programmatic advertising, advertising technology, omni-channel marketing and sales, business-led CRM design and execution, and sales force optimization.

Prior to joining PwC, Barbara served in executive roles in both sales and marketing where she was responsible for the design and execution of digital marketing strategies, corporate re-branding, re-organizing the commercial team, global implementation of, and the post-merger integration of marketing, sale and service teams.

Barbara holds a bachelor's degree from Smith College (Northampton, MA) and an MBA from the University Of Michigan Ross School Of Business (Ann Arbor, MI).  More recently, she completed a yearlong training program in improvisational comedy at Chicago's famous Second City.