While they recognise that advertising technology is increasingly necessary, most publishers in Southeast Asia are still failing to fully embrace programmatic as one of the most important ad tech components today. In this week's industry byliner, Marcus Tan, Asia-Pacific Japan managing director at SpotX, explains why publishers can no longer afford to look away and must start participating in the region's development of programmatic.

The digital ad market is getting more sophisticated by the day, with advertising technology now a wide-reaching facet of the industry. It can be complex, but it is time publishers see this as a friend, not foe.

Most publishers acknowledge this in theory, but evade the idea in practice. Programmatic advertising is one of these ad tech buckets that many across Asia are failing to leverage fully. There are still media owners, and buyers, that believe programmatic only deals with remnant inventory, which is simply not the case, especially for video.

Companies that aggregate publishers' inventory have created a simplified process of ad buying by offering a one-stop shop for advertisers to buy across dozens, or even hundreds, of websites. This is a valuable service for some media owners; but, for most, it can limit the ability to fully maximise video ad yield and ROI.

Marcus Tan

It may take courage to move from tried-and-tested approaches, and guaranteed revenue; but it is time for all publishers in Asia to move towards new strategies for long-term revenue gain. The industry knows it must innovate, as data-driven buying and automation efficiencies inevitably become the norm – and it is time to act.

The case for change

Let me start off by saying programmatic selling versus direct or bundle buys is not an either/or proposition. It is not a case of one or the other, but rather two complementary sales approaches. The new world will be a man-and-machine world, and we are already seeing inventory aggregators moving towards programmatic technology to further enhance efficiencies and offerings to their advertisers.

The benefits that a programmatic approach can bring include transparency and control, efficiency, as well as added revenue opportunities.

Publishers that are unable to monitor and evaluate the behaviour of their advertisers' impressions, fill, yield, and rate, lack the insights they need to maximise revenue. Programmatic technology brings this transparency, which previous methods have traditionally lacked.

In addition, automation brings efficiencies, ad demand partners, and global reach to the mix. Sourcing and maintaining relationships with demand partners across global audiences, without the aid of a single platform to manage these relationships in one place, is a less streamlined and efficient process.

Publishers that continue to sell predominantly through direct or aggregator channels could be missing out on additional value. By utilising the added optionality, addressability, and efficiencies of programmatic, publishers can potentially charge a premium price on a much larger chunk of inventory.

Overcoming the barriers to change

Moving to a programmatic model, though, does have its challenges. As publishers transition to selling more ads programmatically, they will face hurdles related to fraud, skill shortages, and education.

Unfortunately, as is the nature with rapidly growing industries, there is an abundance of poor quality content on the internet — and Asia is no exception. However, it is a small group of publishers and technologies that are responsible for the majority of fraudulent behaviour, as well as the long-tail buying that happens within open exchanges.

Publishers can do two things to help safeguard their buyers. First, they can move to private marketplaces to more tightly control inventory and help eliminate fraud. Second, they should always work with third-party brand safety vendors, such as Moat or DoubleVerify, to understand where fraudulent practices can pollute the market. Adhering to strong brand safety and anti-fraud programmes will maintain quality for buyers and instill greater confidence in the market.

The programmatic community should not have to face the skills shortage alone. The whole industry has a role to play in hiring and training programmatic and data experts to help build the pool of available talent. Publishers that invest in this cause also stand to gain as the market will inevitably move deeper into programmatic.

Similarly, the level of awareness on the buy-side is an industry-wide predicament and there is urgent need to educate those less well-versed in the subject to prevent misconceptions from hampering overall development in the industry.

Buyers will not buy blind forever

Currently, many video ad buyers in Asia continue to depend on inventory aggregators, sacrificing performance for the ease and speed of media buying today. This complacency will not remain for long.

We expect buyers in the region to follow the lead of their US and UK counterparts, opting for transparency into what and where they are buying. Heightened viewability and brand safety concerns will drive this shift, as will increasing sophistication with audience-based buying.

As marketers tighten the screws and demand better marketing performance from their campaigns, they will become more savvy with their media buys. And it is in the best interests of both the buy- and the sell-side to continue to innovate and incorporate programmatic into their media strategies.