Programmatic works, if you focus on outcomes not eyeballs
Hey guess what? Programmatic can work. It’s the measurement, stupid (with apologies to Bill Clinton).
We watched the headlines emerging from a AANA event last week with growing ire: “Programmatic not working” and “Programmatic biggest problem”.
Nick Manning, chief strategy officer of Ebiquity UK’s presentation at the AANA’s The Media Challenge: Achieving Transparency Effectiveness to Drive Business Outcomes, has clearly generated a necessary discussion, but not all of it’s been helpful.
I’m not here to pick a fight with Nick or the AANA, but I can’t leave this stuff out there unanswered, so here goes. This kind of rhetoric is simplistic, naive and just plain wrong.
For context, I’ve long been a passionate advocate for transparency between agency and client. But the important point is transparency in itself won’t achieve better business outcomes or make programmatic “work”.
At the heart of effective programmatic activity is working to meaningful business goals. Simple right? And scary to think this isn’t standard operating procedure. But unfortunately the practice of setting smart digital goals (particularly ones that reflect business goals) is in short supply across our industry. How do I know this? I’ve been privileged to read hundreds of effectiveness awards entries over the past year and we’re still largely measuring the wrong stuff, setting the wrong goals.
Views, impressions and even clicks aren’t business goals. Most programmatic or any marketing campaigns for that matter will not be effective if they do not lead to a meaningful business goal. It’s a bit bloody obvious, yet this, not transparency, is the nub of the problem when programmatic is supposedly underperforming.
The heated debate around ad viewability and ad fraud is a red herring. Whilst it will no doubt sell a bunch of measurement platforms and consultancy gigs, the real issue with the current media discussion is that it’s stuck in a 20th Century paradigm.
To date, the method of measurement has been dominated by reach and frequency. The idea that media should only be measured in readership, listenership and viewership is still alive and well. Even if we all know these audience measures are a lot less accurate than they’re purported, but better some measurement than none.
Take these two scenarios:
1. Your measurement shows that one activity with 50% viewability delivers a five times ROI
2. You achieve 90% viewability with a 1.5 times ROI
Which would you continue investing in?
The availability of ‘fake measures’ has blinded many from the real end goal.
Who cares about clicks, impressions and viewability when ultimately it’s about what drives business results?
So whose responsibility is it to start using real measures and getting the most from programmatic (and any other media investment for that matter)? Echoing Manning’s point of view, Sunita Gloster, CEO of AANA, agreed that the onus of effectiveness needs to rest with marketers.
But most marketers and agencies are woefully unprepared to set relevant goals and measure accordingly – let alone then optimise to improve effectiveness.
Measurement and attribution is the answer
A study run by the IAB in October 2016 ‘State of the Industry: Marketing & Advertising Technology’ showed that only half of marketers had an attribution model in place. We’re not talking about a multi-touch attribution model; that’s any kind of attribution at all. What this means is that only half of businesses in Australia can track a basic conversion.
The tools and methodology are available, so why aren’t agencies and clients working to optimise their media purchase decisions to measurable business goals?
One reason is many agencies are doggedly clinging to the old reach and frequency model, and clients are willingly aiding and abetting it. Don’t get me wrong, knowing reach and frequency of your ads is useful but it shouldn’t be the end point any more. The most important question is what do people do next? And then next, and the step after that? What are all the steps required to end up in a sale?
As management consultant and author Peter Drucker once said: “What can be measured, can be improved.” But too few marketers are measuring or working with their agencies to achieve meaningful measurement.
We’ve had the ability to measure conversion along the path to sale and actionable outcomes for some time now. Measurement technology has dramatically leapt forward, but unfortunately most agencies and clients haven’t kept up. And coming from an independent agency, don’t be fooled. This doesn’t have to mean committing large amounts of funds to mar-tech necessarily, it’s more about asking the right questions about what it is you’re trying to achieve and setting out to measure them from the beginning.
Yes, agencies could be more open about where the money is going, but it’s not going to move the needle one iota if the same old thinking is maintained. And perhaps, just perhaps, advertisers may need to get comfortable with paying for head hours and performance fees – because unless great thinking is paid for, it can’t run on good will alone. But that’s a whole other discussion.
So if you want to know if your marketing is stuck in the 20th Century, if you answer ‘yes’ to any of these, then it’s incumbent on you the marketer to urgently reassess your media relationship:
1. The only goals are focused on media metrics, tarps, reach, frequency, viewability
2. Your agency doesn’t ask you to give them access to the systems that measure your path to purchase (CRM, ERP, POS etc)
3. Your agency doesn’t utilise goals that correlate to your business goals
4. Your agency doesn’t give you a single recommendation for how to improve your conversion rates.
5. You have no way to measure online to offline
6. Your agency’s ROI forecast would make your CFO laugh (out loud), or worse
7. You’ve never seen an ROI forecast before you undertake a campaign
Better input always leads to greater outcomes
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