“The early bird may get the worm – but it’s the second mouse that gets the cheese.”
So an old adage sums up the concept of second-mover advantage. Google was not the first internet browser or search engine. Apple did not produce
the first smartphone or tablet. Boeing did not pioneer the passenger jet nor GlaxoSmithKline and Zantac ulcer relief. However, as classic ‘fast followers’ they were able to create entirely new markets by coming to the party later, avoiding the traps and pitfalls, and spotting the real opportunities. They were the second mice, which devoured the value that was out there.
Programmatic has had plenty of pioneers. You only have to glance at the ever-expanding Lumascape chart of industry vendors to see as much. We are currently making the transition from an initial goldrush to the fast follower phase when the more enduring opportunities for the technology start to emerge. There is no stronger evidence of this than the fact that the most cautious marketing mice of all are now on the move.
B2B’s appetite for programmatic
Business-to-business (B2B) marketers hung back from the programmatic party for a long time for the simple reason that the value the technology was chasing was far less relevant to them – and the risks therefore made limited sense. Blind, real-time bidding on open exchanges to deliver the greatest number of exposures at the lowest possible cost does not really help when you need to influence specific groups of decision-makers and reach them at their most receptive.
Business-to-consumer (B2C) brands and their media agencies may have had their own frustrations with the way that programmatic was applied to chase cheap reach and volume. According to the Association of National Advertisers (ANA) and Forrester, 63% of programmatic advertisers are still worried about viewability for their programmatic ads, and 69% believe ad fraud is undercutting their performance. However, to many B2B marketers these were not just downsides – they were deal-breakers. B2B was the most difficult customer of all for programmatic to please.
So why, now, are we seeing a far greater appetite amongst B2B brands for programmatic solutions? After all, according to Dun & Bradstreet 66% of B2B marketers believe that programmatic should be just as valuable to them as it is for B2C, 54% are already buying ads programmatically and 65% say they will spend more budget on programmatic this year.
It is because the fast followers are are emerging, among adtech companies, publishers and agency trading desks – and the nature of programmatic is changing as a result. Just because the technology can be used to chase low cost and low quality, it does not mean that it has to be.
Forrester forecasts that open exchanges’ share of buying will decline from around 65% of programmatic buying today to around 20% by 2021. In its place, forward-thinking companies
are developing ‘new’ types of partnership for advertisers and media platforms – and they are finding far more innovative ways for programmatic to add value to their businesses.
Programmatic proves its value
For a B2B marketer, the real value in programmatic is not chasing audiences anywhere they go online. It comes from using real-time automation, algorithmic targeting and relevant data within quality environments where you know exactly who you are engaging with. This enables them to use their data more efficiently and effectively whilst still knowing where their ads are – and whom they are targeting. It means that programmatic does not replace their relationship with a publisher or media platform; it enhances it.
The value in programmatic becomes more apparent and accessible to B2B marketers when they have flexibility in how they approach it. In some circumstances, this involves using bespoke data to target audiences based on intent – and to do so across a selection of relevant platforms via open auctions. In others, it will involve leveraging the identity-based data of the platforms they deal with in private auctions – filling the gaps where their own data is lacking to ensure they always target intelligently. In this fast follower phase of programmatic’s evolution, we are seeing more workable solutions in all of these areas – and that is why B2B will be playing a far more prominent role in its future growth. There is much tastier cheese on offer – and there is a way to avoid the traps.
The stress test for programmatic
LinkedIn is a part of this coming together of B2B and programmatic. We are shifting our own focus towards programmatic for display advertising, and away from more traditional buying approaches. It is a natural part of providing B2B marketers with greater control, efficiency and responsiveness in their most relevant, premium environments.
It also makes us part of a trend that will enable advertisers to feel more confident about feasting on the value that programmatic has to offer – without getting caught out. Members-only environments provide protection from bots and other vehicles for ad fraud. Their commitment to user experience often results in far higher viewability for programmatic ads as well. And when they are able to bring their own precise data to the programmatic table, they multiply the value that marketers can gain from the technology.
There is no better stress test of the ‘new’ programmatic than whether B2B marketers trust it with their objectives. As an industry, we are already seeing evidence that programmatic is set up to more than pass that B2B test.