The Disadvantages of Programmatic Advertising
How The Adtech Industry
Cashes In on Ignorance
The Problems You Face With Programmatic Advertising
Why Measurement isn’t Consistent at Some Agencies
How Lack of Agency Transparency Costs You Money
So, one of the biggest disadvantages of programmatic advertising is: the lack of transparency in pricing and costs.
This is the #1 way agencies take advantage of their clients and misuse your ad budget. We said we would spill the tea, so here goes.
When programmatic first emerged a few years ago, there were very few standards and controls in place, which meant that middlemen – like your agency DSP’s – could inflate costs.
Tragically, many programmatic advertising companies saw this as an opportunity to cash in. These agencies were taking 40-65% of their clients ad spend in ‘hidden fees.’
Buried deep in the bowels of overly complex contracts, were clauses that made this perfectly legal. Unethical, yes – but legal. And clients didn’t know any better.
Murky fees, restrictions and knowledge walls made it possible for these digital agencies to take 25 cents on every ad dollar. As it does, this all came to light a couple years ago.
Programmatic technology is incredibly transparent, even if some agencies are not. Slowly, the tech tax is lifting and now the average ad fees hover around 20% in the US.
How a Lack of Third Party Visibility Harms Your Ad Campaigns
The Reality of Ad Fraud in the Industry
Why Viewability of Ads is a
Cause for Concern
How Brand Safety Should Be Your Main Priority
How to Choose an Ethical Digital Advertising Agency
Step #1: Explore Their Business Model
Step #2: Look at Their Results
Step #3: Ask About Their Team
Step #4: Ask How They Address Industry Problems
Choose a programmatic advertising agency with:
- The right business model (one that specializes in programmatic ad buys)
- A track record of successful programmatic ad campaigns
- An educated team that understands data analytics and strategy
- A working solution for every industry problem
What Have We Learned?
Disadvantages of Programmatic Advertising:
- Some agencies cash in on client ignorance around ad tech
- Inconsistent measurement and metrics of data
- Lack of agency transparency (pricing and hidden costs)
- Lack of visibility on third party sites
- Ad fraud<
- Viewability of ads
- Risk of Brand safety
- Bot Traffic
- Poor inventory quality
That doesn’t mean programmatic ad tech can’t be cost-effective and drive performance-driven results. You need to look for trust-worthy programmatic agencies that are experienced and transparent.
Here are important factors to look for in a programmatic advertising agency to team up with:
- Ensure they have the technology stack and human expertise
- Make sure the team is experienced in strategy and data analytics. They should have digital marketers and data scientists on the team
- Make sure there is transparency in pricing. No hidden fees and know that your ad budget is actually being spent on buying ad space and not on tech tax
- Get a good understanding of your chosen agency’s strategies, methods and processes.
- See if they have a good track record when it comes to client projects. Ask to see their portfolio or case studies to determine if they’re a good fit for you
- Double-check that your ad partner is proactively helping you reduce ad fraud activity in your campaigns. That way you can receive accurate data for insights and better return on investments
- Viewability of ads is an ongoing issue in the programmatic space, so be sure that your partner actively works on solutions for this
- Brand safety is incredibly important for your business and it should be for your ad partner too. Make sure your ads are being managed and delivered properly and don’t be afraid to ask to see what your ads look like and where they are served