If the 2010s characterise the birth, early and adolescent years of programmatic display advertising, then the 2020s should see the adult programmatic self emerge; still with lots of growth and development to come but not so wild and irresponsible, and introducing a level of maturity in its way of working.
Programmatic display advertising (RTB) as we know it is done. Not all of it, but elements of it, particularly the Open Market Programmatic (OMP) version. Change has been long-coming so this won’t be surprising to most, but what it will change to is still unclear, and the shift may feel more like ‘sudden death’ if browsers and regulators act as expected in 2020.
As a January reminder for those brains still on holiday, there are a few primary factors that will drive change in 2020:
Impact of impending regulation
The ICO has made clear there is too much personal data shared in RTB with not enough control, and it’s too easy for data to be misused in OMP by unscrupulous actors. To address this concern today, the only viable remedy is to remove personal data from OMP, significantly reducing its value for both advertisers and publishers. Lower value will drive premium publishers out of OMP, who will look at other ways to monetise their audiences and inventory, leaving OMP to be filled with long-tail, unregulated websites.
This is significant. OMP currently makes up 70-80% of all RTB for premium publishers, so a change to OMP is a significant change to programmatic display advertising. While timings are not clear, this change will happen in 2020, most likely the first half.
Browser wars: Google makes its move
Safari and Firefox have long been at war with adtech over tracking users. In general terms, if you can’t track a user in RTB then there’s no value in targeting them. In 2020, Google will join this war in its own way with the rollout of SameSite (providing a higher level of data security in the Chrome browser) and by removing contextual categories for OMP impressions. Google will make sure these changes don’t affect its advertisers, which is good for Google and its advertisers but not so good for competition and the wider adtech industry.
As these changes roll out in the first quarter of 2020, we will no doubt be hearing lots more from Google in 2020.
Measurement must mature
With less tracking data in RTB impressions, the influence of conversion metrics to measure success will be greatly reduced. While this may impede marketers’ ability to accurately assess their digital advertising based on these metrics, it will encourage a shift towards more general measures of media effectiveness, and towards longer-term brand-building metrics and indicators of real business effects.
This is a good thing, and thanks to initiatives like The Telegraph’s ‘Metrics That Matter’ we’re certain to see measures such as brand awareness and consideration scores becoming increasingly important in adtech.
The Trade Desk disintermediating adtech
A significant 2019 development that seems to be broadly overlooked is The Trade Desk joining the Prebid.js board. While TTD is the world’s second largest buying platform (after Google’s Display & Video 360), Prebid.js is the most widely used technology framework for RTB with direct connections to more than 50% of publishers. TTD’s potential influence – through billions of dollars in advertising spend – on the direction of Prebid.js cannot be underestimated. This will most likely be great for TTD’s advertisers, possibly great for publishers, but not so great for the wider adtech industry.
TTD joined the Prebid.js board in December 2019, so expect its influence to be felt this year.
By growing up we create new growth
What will all this mean in 2020 and the decade ahead?
The world will be simpler, which is no bad thing, with fewer partners doing more business. ‘Privacy by design’ will become a central element to discussions as all parties look to develop sustainable, compliant partnerships.
Creative and context will matter even more. This will be a great outcome for publishers and brands looking for greater effectiveness and will be welcomed by users who are tired of targeted ads following them around the internet.
We will see the revival of ad networks to service vertical sectors. Along with Google, they will become the saviour of long-tail publishers, which will rely on them to deliver value at scale in their sector.
Similarly, at the other end of the publishing spectrum, premium publishers will organise themselves into private exchanges, such as The Ozone Project, or into multi-publisher private marketplaces; with both providing a safer environment for introducing greater compliance, auditing and sharing controls over the personal data coveted by so many.
Agencies and advertisers will work together to shift success targets away from adtech conversion metrics to effectiveness measures, with those who fail to do so fishing in an ever-shrinking pond of inventory. As the effectiveness of agency trading desks – large operators of OMP – diminishes, agencies will downsize and shift investments to managed services and aggregators (ad networks and private exchanges) that can deliver results and scale in a regulatory compliant way.
For vendors that don’t have a direct relationship with a publisher or advertiser, consolidation and closures are inevitable.
Great change is looming, and I believe this makes for a brighter future. OMP as we know it will be replaced by better ways of working, led by marketers and publishers, addressing many of the systemic issues existing within the current set-up. This time next year I believe we will be part of a more mature digital ecosystem built on trust, brand safety and delivering real business results for advertisers.
Damon Reeve is chief executive of The Ozone Project