The advent of programmatic advertising was a turning point in ad tech. Before programmatic, digital media relied on insertion order (IO) buys and struggled to scale up as internet publishing exploded into existence like a newborn universe.

Programmatic brought automation to online ad buying and selling. That was huge. It caught publishers up to the new normal of digital advertising. But in some ways, it has always held publisher revenue back from its full potential.

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There are many facets to programmatic advertising, and some very advanced strategies you can employ that can truly transform your ad revenue. Many publishers want to turn on programmatic solutions and “walk away,” and they may not realize that by just using the traditional, basic, or standard features of programmatic, they are leaving revenue on the table. 

This article details five key reasons why just using traditional programmatic advertising might be holding back your revenue, as well as some alternatives to traditional programmatic.

The team at Playwire knows how to make programmatic advertising work for publishers. To get a personalized revenue amplification strategy, contact our digital advertising experts today.

How Using Just Traditional or Standard Programmatic Advertising Holds Back Publisher Revenue

The pre-programmatic days had their share of problems. IO buys require a lot of staff members, paperwork and back-and-forth communication between publishers and advertisers. 

But the fact that traditional programmatic advertising came along and solved some of those problems does not mean that programmatic is perfect. It isn’t. We explore five reasons why below.

1. Budgets Aren’t Guaranteed with Traditional or Standard Programmatic

Publishers rely on ad revenue to stay afloat. It sure would be nice to have a guarantee that a certain amount of inventory would be sold at a particular price, but that doesn’t happen with programmatic. 

Agencies and advertisers like to have their budgets working on multiple programmatic exchanges at once - not to mention in multiple advertising environments. They can switch up their strategies at a moment’s notice, leading to a potential revenue loss for the publisher. In fact, the Interactive Advertising Bureau allows anyone to get out of custom media within 30 days and standard media within 48 hours.

2. There’s Always a Middle Man

Traditional programmatic advertising takes place on an ad exchange and loops in demand-side platforms (DSPs) and supply-side platforms (SSPs). All those players are middle men who take a cut of each dollar advertisers spend. 

So, instead of the money flowing from the advertiser or agency to the publisher, it goes from the advertiser and through multiple stages of the traditional programmatic environment, losing value at each step. On the other side of it all is the publisher with an outstretched hand waiting for what’s left to fall into it.

3. Programmatic Impression and Click Fraud

Non-human traffic has plagued traditional programmatic advertising since its inception. The automation and relative anonymity of programmatic leaves it wide open for fraudsters to send in bots to inflate revenue. 

Experts estimate that 28% of total web traffic comes from non-humans. You’re kidding yourself if you think those bots are reading publishers’ content and ads. This reality weakens publishers’ ability to accurately price their inventory and assess its real potential impact with consumers.

4. Advertisers Are Losing Trust in Programmatic

All that fraud is causing some advertisers to lose faith in programmatic advertising, too. Advertisers lost an estimated $39 million each day due to ad fraud in 2017. Not surprisingly, more than 40% of advertisers told ExchangeWire that they were starting to doubt traditional programmatic display ads.

While the vast majority of display ad budgets still go to programmatic advertising, the fact that advertisers are starting to lose trust in the programmatic strategy could spell big trouble for publishers who rely solely on it.

5. Too Little Human Element with Programmatic

A lot of advertisers approach programmatic ad buying with a set-it-and-forget-it mindset. Many publishers do the same. It’s tempting to do it that way when programmatic technology offers so much convenience, but the lack of a human element can cause huge problems with an ad campaign. 

One wrong setting, and you could have inventory going to waste or being sold for less than what it’s really worth. That’s why human-led programmatic ad campaign management is key.

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Programmatic Advertising Pillar

Read the full guide and stop wasting revenue on programmatic done wrong. 

More Advanced Strategies for Programmatic Advertising

It’s not all bad news. Traditional programmatic isn’t the only way to sell your ad inventory. There are plenty of alternatives to just the basic programmatic features:

Programmatic Guaranteed

Ad delivery is still automated with programmatic guaranteed, but publishers and advertisers negotiate prices for particular inventory that is “guaranteed” for the advertiser. Similar in many ways to traditional IO buys, this method provides a lot more assurance that the budget will go to the publisher.

Programmatic Preferred

Programmatic preferred advertising gives certain buyers preferential access to your inventory. This is not a guarantee, but giving preference to a buyer or set of buyers can lead to higher revenue and a lower likelihood of ad fraud. This outcome is a result of the in-person negotiation required to set up the publisher-advertiser relationship.

Private Programmatic Marketplaces

Private programmatic marketplaces set up an exclusive environment in which certain advertisers have access to the inventory of particular publishers. This often nets a high price for publisher inventory and prevents a lot of the click and impression fraud seen on open exchanges.

Want to learn more about the pros and cons of programmatic advertising? Check out Advantages and Challenges of Programmatic Advertising: A Full Breakdown.

Playwire: All the Pros of Programmatic without the Cons

Traditional programmatic advertising isn’t all bad, but it isn’t all good either. The key is knowing how to increase the pros of programmatic and use other ad-selling methods to reduce the cons.

Playwire has a deep bench of people and processes meant to do exactly that. Our team works for publishers every day with one goal in mind: maximizing revenue. Let us get to work for you. Give Playwire a call at 561-206-4621 or contact us online to get started.

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