Previous slide
Next slide
Previous slide
Next slide

What are the 3 most common misconceptions about Programmatic DOOH?

Jonas Glad

CEO

DoohClick

Jonas Glad

Jonas Glad

26 September . 7 min read . Opinion

(Credit: Tractor Outdoor)

Let’s be honest. Programmatic outdoor is just another way of selling out of home inventory. And the extent to which media owners are set up to trade their assets programmatically varies wildly depending on which country or continent they operate in and if they are really tech ready.

Endless reports generated by the purpose-built OOH programmatic players flooding our sector, tell us how more and more agencies, planners and buyers are planning to channel ad budgets into programmatic.

The question is how much of this is new ad revenue coming into OOH as opposed to the shifting of orders from direct or specialist sales to programmatic, effectively cannibalising existing OOH revenue streams.   

In the UK, where take up has been slow, JC Decaux tells us that advertisers plan to increase spend on programmatic out-of-home by an average of 31% in the next 18 months, while 15% plan to use the media channel for “newly allocated” marketing budgets.

Over in the US, we know from our clients and industry bodies that the market is much more advanced. Growth US side is aided by the likes of Vistar Media and Place Exchange who are actively supporting programmatic trading with their own sales efforts.

In the US, advertisers can bid in real time on OOH inventory. The flow is completely automated. All the media owner has to do is approve the creative. Other than that, they can sit back, and watch programmatic campaigns pop up as and when the clients buy.

And that’s fine, as long as they aren’t all eating from the same OOH revenue pie.

Put simply, if you are a media owner and you’re putting ad sales that you could do directly with the client into the programmatic ecosystem, this means the client is losing money because there’s a tech fee on their side and you, the media owner, are losing money because there’s tech fees on your side. In other words, each OOH Euro spent equals less for both parties in that transaction.

Some companies have moved away from media agencies, establishing in-house teams in an effort to attract programmatic spend away from the online behemoths.

But if you are simply shifting the way you are trading, you’re not creating more money, you are just diluting how much you are already getting from the existing OOH budget.

Programmatic has benefits client side if they have third party or their own data because they can execute more efficient campaigns. Then it makes sense, but to just shift orders into programmatic without any data sets is pointless.

From where we are sitting, we are still in a trial period. Advertisers want to start buying in the programmatic ecosystem, but they are still doing it in a very manual way.

As a brand, the only reason I would buy OOH programmatically would be as part of an omnichannel campaign because I can control it, measure it and see my total spend in combination. And that’s a powerful proposition.

I don’t therefore see a future for a single demand side platform (DSP) that is OOH specific because clients need to see their total campaign and total spend, rather than an OOH silo, an online / digital silo and a TV silo.

From the media owner’s perspective, there are some interesting factors at play, for example on Pricing.

It’s important not to devalue or commoditize your inventory particularly if you are at the premium end of the OOH spectrum. This is not a race to the bottom. Pricing strategy is very important.

Equally important is how you allocate various supply side platforms (SSPs) to your inventory. This is something we do easily within the DoohClick platform. With both guaranteed and non-guaranteed allocation of time, for example, you don’t need to block out a slot in a loop if you prefer not to.

Media owners also need to think about the administrative workload involved in taking on multiple SSPs which require different management skills to achieve maximum results.

Then there’s the disconnect with those might be labouring under the misapprehension that by connecting to an SSP, revenue will start flowing into the account from day one. That is simply not the case. OOH people still need to sell their inventory, promote it and talk the right language.

Marketing is critical. For example if a media owner uploads a large portion of inventory into, say, Hivestack, that means those DSPs connected to Hivestack can go in to see that inventory.

But will they automatically search for the inventory? Probably not. Will they actually understand the inventory? Probably not.

Which means OOH salespeople need to not only promote their inventory to planners and buyers but explain what makes buying programmatically different to buying space traditionally, directly from a salesperson or via a specialist.

Buyers need to be educated. If the buyer is using an omnichannel demand side platform (DSP) how do they find your audience and what are the USPs of your OOH network? You cannot see that in the DSP, so you will need to explain how to execute the best programmatic campaign on your network.

In the US, Vistar Media and Place Exchange have tackled this. They have their own sales teams helping agencies to achieve campaigns because it’s in their interest to do so. And from a buyer’s perspective if you can achieve a campaign across 50 media owners without having to call 50 different media owners that’s a huge benefit, particularly when you are getting the results back in real time.

However, in Europe and the smaller markets it’s fundamentally different. There is no sales provision on either the SSP or the DSP side.

The final thing media owners need to think about is cash flow. If you are a media owner you will probably be invoicing on the campaign start date, or two weeks before the campaign. Trading programmatically, it can be 90 days after the campaign has been served before your SSP pays you.

Currently that’s not so much an issue because, outside of the US, such a small portion of revenue comes from programmatic. All the same, its still a longer wait to get paid.

The consolidated OOH programmatic sell

In South Africa, DoohClick works alongside Remi Du Preez and Polygon, a programmatic only DOOH business.

Polygon’s ambition is to bring to the market the largest consolidated network across Africa and they are reporting significant success in digital and performance teams wanting access to OOH through a single point of contact. This was the inspiration for Polygon which consolidates inventory across a variety of OOH publishers.

Remi tells us: “We have aligned all our marketing and product efforts to align with digital strategy and thinking. We are complimentary to the digital strategist but allow them to run all digital campaign elements from their own dashboards. The very last USP that we have created is attribution models that allow a customer to measure whether people are coming into a shop or going online after viewing a DOOH campaign. These are the layers that are helping us work uncontested in the digital agency where we try to grow the OOH share of market by taking budgets from digital pockets.” Great stuff.

Remi’s top three misconceptions very much mirror our own:

  1. That programmatic OOH is an easy way to make extra money. Many companies assume once you get an SSP you get money “for free”, but there is still a person at the other end who needs convincing. Media owners need to upskill themselves to understand how programmatic works, when to recommend it and who is in charge of running programmatic campaigns. It requires effort and a human element to increase sales.
  1. Conversely, that programmatic OOH isn’t worth the effort. Both Polygon and DoohClick have experience of media owners who stick to legacy loop-based buying and think too much effort is required for programmatic immersion in their business. Yes, it does require effort, however there are commercial benefits to being programmatically connected. Likewise, there are clear benefits that will assist a client too in certain campaign executions. It is difficult to get right – the right structures, teams, training, and so on, but a clear business case can be developed upfront to see the gain before one steps into the effort.
  1. Clients need to choose one DSP: Remi has encountered clients that specifically only want one platform to run their entire programmatic efforts. There are many DSPs out there and each has its pros and cons. Clients need to break this mindset of only having one DSP and rather take on a few to tinker with. There are different tools available on different platforms for different use cases, so Remi recommends that clients take on more than one DSP. These systems are on a pay-as-you go method meaning they won’t need to fork out a subscription fee to have a service they may not fully use.

 

Conclusion

Testing is well underway, but let’s not get carried away. It’s still very early days and the reality is that just a small percentage of all DOOH is currently traded programmatically, with many media owners not yet in a position to start programmatic trading across their portfolios.

In planning to go programmatic, there are three important factors media owners need to consider:

  • Is the tech setup on your screens ready for the transmission of real time ads?
  • Have you asked your clients if they are ready to start buying programmatically on your sites / screens?
  • Cashflow – how will your business handle getting paid 60 to 90 days after a programmatic ad is actually serviced?


How to prepare

  • Set a percentage target on turnover from programmatic deals.
  • Plan how much percentage of screen time will be available for programmatic spots.
  • Decide on a pricing strategy regards direct sales versus programmatic trading.
  • Client value – communicate the difference between direct sales and programmatic sales.


Programmatic trading will generate new challenges for your ad ops team. How are they going to handle it?

  • Rank all DSPs to see which is needed to connect to.
  • Base this exercise on what your clients are using today.
  • Select your SSP according to your DSP list.
  • Hire skilled programmatic salespeople from online sales because traditional OOH salespeople will not get you rich on programmatic.
  • Finally, hire skilled admin people to handle your SSPs.


For further information please contact Jonas Glad, email jonas.g@doohclick.com

https://doohclick.com/

Jonas co-founded DoohClick in 2019 after the Swedish owned proprietary ad platform was demerged from NASDAQ listed AdCityMedia. Originally developed over a 10 year period and previously operated as StarCorp, DoohClick provides global media owners with real time ad serving ecosystems which facilitate complete sales support, dynamic scheduling, improved analysis and fast reporting.

Prior to the formation of DoohClick, Jonas was chief operating officer of AdCityMedia AB. Having started his career there in sales, Jonas was instrumental in using the company’s progressive digital software to expand its acquisition trail, leading to its NASDAQ listing in 2017.

 
Under his leadership, DoohClick is now a fully independent company providing new business opportunities and updating legacy OOH systems across 11 markets.

It is Jonas’s vision to incubate an international network of like-minded collaborators under the auspices of DoohClick to introduce improved, common standards and support new and emerging technology across the OOH sector.