Many marketers are still focused on cost rather than quality when it comes to programmatic advertising
In the asset management and higher education industries reaching the right audience is essential, but many marketers are still too driven by cost rather than quality when it comes to programmatic advertising.
Fundamental Media, the media planning and buying arm of Fundamental Group, works mostly with asset management and higher education businesses. In asset management, as well as other B2B verticals, tight audience targeting is essential because there are only a limited number of relevant professionals in the target audience. This is not too different from the higher education sector, where there are several programs with unique target audience, as well as increased competition.
A recent study by the Association of National Advertisers (ANA) into programmatic media transparency found that many buyers are still focusing on getting the lowest cost inventory rather than the best value inventory. Half of all observed open programmatic buys were $3 CPM (cost-per-thousand impressions) or less, its figures show.
Source: Association of National Advertisers
But cheap rarely equals good. The study revealed that a high amount of programmatic expenditure goes towards made for advertising (MFA) websites, with clickbait articles, sensationalist headlines and other low-quality and provocative content. These websites account for 21% of impressions and 15% of spend within programmatic advertising.
Furthermore, it found the average campaign runs on 44,000 websites. The report said: “It is hypothesised that the ‘long tail’ of the web adds minimal reach yet likely performs badly in areas such as fraud, viewability, and brand safety, assuming such issues can even be measured there.”
Despite the ANA figures showing that many advertisers go for cheap rather than high quality, a report by IAB Europe found that the quality of programmatic media is a concern for a large portion of advertisers and media agencies. Its Attitudes to Programmatic Advertising Report 2022 showed that 47% of advertisers and 43% of agencies name the quality of programmatic media as a top-three barrier.
These findings are similar to the results of a survey by the Programmatic Pioneers Summit, which revealed 47% of respondents sees inventory quality as one of the top two challenges they face. Meanwhile, 53% worry about too much complexity, as they feel there are too many layers in the ecosystem.
Like the ANA, Fundamental Group has noticed advertisers run the risk of prioritising cost over quality. We see that some marketers believe programmatic advertising is the cheap option, without thinking about what this means for the quality of traffic they are receiving.
While many of our clients (both asset management and higher education marketers) regularly pay a high CPM (sometimes more than $100) when spending directly with prestigious financial publishers, they are unwilling to spend the same amount on programmatic advertising.
However, by shifting their focus from cost to quality, programmatic advertising offers them the opportunity to get better quality traffic and target the appropriate audience. This is especially important for a sector such as asset management, where many firms are targeting the same finite number of financial advisers or institutional investors.
While an FMCG company has a relevant audience of billions, most asset managers are going after a select group of people, such as financial advisers in the UK, of which there are only around 10,000. Rather than aiming for a high number of impressions, asset management marketers should therefore focus on ensuring their messaging reaches their specific target group. This will result in a lower number of impressions and clicks and potentially a higher CPC and CPM to beat the competition, but the impressions and clicks are much more likely to come from professional investors.
Fundamental Group has pioneered in tailoring programmatic tech to provide higher-quality targeting by using more audience-specific and industry-relevant overlays than other programmatic platforms. Aside from runlists and keyword matching, AMX, Fundamental Group’s programmatic solution also uses advanced contextual targeting, industry overlays and firmographic targeting. Using these products have yielded results that have given a much higher match rate with target companies. For example, we are therefore able to have a 70% match rate to a target audience in a typical campaign versus 5% that would be reached with broader targeting and reach.
A greater focus on quality can thus massively improve the outcome of a programmatic campaign. In an industry where many advertisers are vying for the eyeballs of a select group of individuals, it is important to ensure your message gets seen by your target audience. By using the right solutions, programmatic advertising can help you achieve your marketing objectives.