In a new role, heading up strategic development for AppNexus across Europe, Nigel Gilbert has been looking at the key market indicators that could drive (and also hinder) the growth of programmatic. Here he discusses the notion of a level playing field within the agency and marketer relationship, and the notion that a 'single customer view' is not the only way.

The huge potential of programmatic should be a source of significant excitement for the industry. Publishers, agencies, advertisers and consumers are set to benefit from more effective, more targeted and more valuable advertising.

However it cannot, and should not, be seen as just another media channel – something to be negotiated between agency and client, or something that can be in-housed or out-sourced – it is so much more than that.

Recent history can give some useful context. When Search first emerged it created its own performance metrics and attribution, essentially becoming its own channel – something which is now executed almost entirely programmatically.

A few years later and Social followed a very similar path, creating new formats, measurement and attribution – a discrete channel that today is also executed almost entirely programmatically.

Now, in the display market for both desktop and mobile, the technology is there for buyers and sellers of all sizes to leverage their online, offline, search, and first party customer data across their display buying as well.

Does that mean that ‘programmatic’ is another channel? It has not created new performance metrics, rather made existing ones more tangible and measurable.

It has not changed the landscape in terms of who the important inventory sources are, or the relevance of great content – so why do we isolate it and find ourselves debating who should control it?

Despite the technical maturity, research shows us that market players are investing in programmatic with a low level of control or understanding. In many instances business strategy and operational understanding have yet to catch up with what the technology can do today, let alone where it can take the industry in the coming years.

As a result, the market forces at play in the 2015 ad tech power game won’t always favour the best technology or even the optimal long-term solution. Instead, there will be powerful motives to choose the apparently easy or safe option; without understanding the strategic context of that decision until it is too late.

This is in fact how the early market developed, and why the lumascape today is so crowded.

There are several key drivers of growth that are potentially being overlooked, as the range of options creates a level of confusion and disparity. Where there is high growth available, so will there be market confusion.

An abundance of different opportunities put in front of publishers, media buyers, and marketers – all claiming a unique offering, market leading technology or an intangible differentiator. The marketer has traditionally had a strong grasp on the concepts delivered by their agency, and been very comfortable with the dialogue and the relationship.

However, the increasing number of technology companies, and varying views of the future being presented by vendors, has led to marketers not knowing who to trust or what to believe.

We all read a lot about the lack of transparency Agency Trading Desks are perceived to deliver to the agencies and to their marketers. Lots of questions about business models and where margins exist in the programmatic trading.

The mistrust reached such a degree, that while speaking to a marketer last month, I was told that they have now ‘given their budget to a retargeter’.

When asked if they get transparency of media cost from them, the reply came back ‘well no, they insist on buying on a CPA only’.

We now have a situation where the marketer has moved from a relationship they understand but don’t trust, to one they trust, but do not fully understand.

Pair this with the current onslaught from the giants that are Google, Facebook, and Amazon. The marketer is being told that a single view of the customer is the most important indicator for their media spend.

There is no doubting the importance of tracking a logged in user across various platforms, however, this should not be executed at the expense of content, audience, and creative – all areas their agency partners have delivered very well on for years.

Consumer behaviour creates a potentially exponential number of data points that can now be captured, from login, to location, device, purchase history, search, social, content consumption – the list goes on. All are important, and need to be assimilated and leveraged according to strategy and the desired outcomes.

The premium publisher is also at risk of losing sight and control of how to differentiate. This group has spent decades producing and curating audiences and content, and should not be facing a future of selling individual users depending on whether they logged in somewhere else first.

Sometimes the single view is the overriding influencer, at other times it needs to be a shared experience within groups brought together by content and behaviour.

The dialogue between agency and marketer is naturally volatile, as there are such large budgets and performance goals at stake. Testing of new opportunities and techniques should be fundamental for marketers in any sector, but the playing field must be level.

Demand the appropriate level of transparency and performance according to the business objectives, but make it the same across all providers, this is the only way to ensure that pressure is being applied in the correct areas.

We are living through one of the most exciting periods in the history of advertising, and we all need to ensure marketers can distinguish between signal and noise, to rise above claim and counter claim, and to execute effective campaigns that realise the full potential of programmatic.