Direct Media Buying vs Programmatic Media Buying

This has been an ongoing fight for the past years, since the introduction of Programmatic Media Buying in 2011, the advertising world began to change and every month more and more advertisers decided to allocate part of their budgets on the new toy! This is the reason why everyone seems to be talking about Programmatic and the reason why we have decided to talk about this great option.

In this very useful entry we will identify the differences between each method and determine what is the most suitable option depending on the different types of needs. Our goal is for you to bookmark this information so you can always get back here quickly and be informed with nowadays buying trends.

Let’s start by defining each of them, so we know what we are dealing with. Direct Media Buying as you all know is the way we have always bought ad spaces since the beginning of advertising times.  If you want to advertise for instance…let’s say on Times Magazine or ESPN, you would just contact them, talk to someone on the sales department, get a Media Kit, choose the ad space you are looking for according to your campaign needs and pay for it… A very old fashioned method in which account managers and media buyers could get connected, negotiate and build long term relationships or not. A more social human role.

On the other hand we have Programmatic media buying, the technology applied to marketing combined with audience insights allows to target specific campaigns to a particular individual, at a particular time and in a specific context. Contrary to what many people believes this buying method is transacted across different platforms, not only digital media, but, TV, print, radio and Out of Home (OOH).
This is new way of buying that is not only available for monopolies, nowadays many media agencies work very close with technology providers to use Ad Exchanges, while others have decided to invest a little more and have developed their own trading desks, allowing them to place ads programmatically.
You might be wondering how it works, right? Well, as usual, there’s an Algorithm behind! This algorithmic method of transacting media inventory allows to automate the delivery of data driven, target and generate relevant experiences to customers as they interact with different brands.  The best programmatic marketing recognizes the consumer as he moves between channels and touch points, so that each interaction informs the next. Data is everything and that’s what you pay for when you buy programmatically, that and of course, optimization…using predictive analytics and dynamic bids based on several factors, including for instance, if the user has been on the advertiser site on the last 30 days, the weather, geography, time of the day, etc.

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Now, let’s see the ups and downs of each method this will help you determine what is your best option according to your business needs!

Direct Media Buying:

Good:

  • Safe, it’s very difficult to fall in the “fraud” category. Almost always you get what you pay for.
  • No intermediaries, direct relationship for any demand you might have, questions or concerns.
  • Easy to approach.
  • Transparent, trustable.
  • Eventual fraud impressions will not be charged.
  • Dedicated account managers, someone will always be accountable for the traffic.

Bad:

  • Every publisher knows the value of their audience and they will charge you for that knowledge. You get the best, but the best is not something that everyone can afford.
  • Sometimes it can be slow, many big brads have most of their premium inventory sold and you have to wait in queue for your turn.
  • Although fraud is difficult to find, you have to be careful with what you buy. The big publishers sometimes offer accessible CPM’s but in order to see your ads the user will need to go through certain actions that sometimes leave your product unexposed and you end up wasting your money.
  • Fraud impressions will not be charged, yes, that’s true…but this is a tricky one, sometimes what is fraud and what is not, depends on the service the publisher uses to monitor their inventory, if the fraud detection tool is out of date or if the bots where one step ahead, you might end up paying for something that never happened. It’s not common, but it happens.

 

Advisable for:

  • Big advertisers who know their campaigns very well and know exactly where they want to be and who they want to reach.
  • Stablished brands with solid budgets and experienced negotiators.
  • Companies that want to make an impact or deliver a message strongly.

 

Programmatic Media Buying:

Good:

  • Low cost, accessible business models!
  • You can access thousands of publishers through one single channel.
  • You don’t need to have a big structure or a group of media buyers, you can just contact a Media Agency with a programmatic system, tell them your needs and you are ready to go.
  • Fast, you only sign 1 contract and you are connected to a lot of publishers.
  • Low transfer cost, it’s always better to make 1 big transaction than 10 smaller ones.
  • Testable, if you are not sure what is the right audience for your campaign, or if you want to make small tests with different sources to find the best target for your campaigns, you can do it!

Bad:

  • It’s exposed to bot traffic and fraudulent impressions.
  • You will always deal with intermediaries.
  • It’s not always possible to get full transparency.
  • Difficult to control, unless you have the technology and the human resources to do so.
  • It might be hard to access to premium inventory, even if you pay flat rates.

Advisable for:

  • Anyone who’s willing to test different publishers, big and small advertisers can get the most from this service with proper control.
  • Anyone who’s not sure what’s the right audience for their campaigns should start here, with a low budget you can get an idea of where your product should be targeted to.
  • Brokers who are in need of allocating 3rd party campaigns should always try this option first.

 

That’s all we can tell you by now, don’t be frighten of Programmatic, we advise you to try it. After all…you can always move on to target specific publishers once you know the most suitable for your campaigns 😉

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