It is critical for business leaders to make sense of the ever-changing digital landscape to drive their strategy and be more relevant to their customers. Having met a few key players in the Australian market lately, I decided to focus on the two main criteria that are holding our industry back in terms of growth. Firstly, looking at the future of Programmatic in the APAC region and secondly assessing the skills gap on the market.
What is Programmatic?
I simply define programmatic as the use of technology to bring efficiencies and measurable outcome in delivering real-time media and creative to the right audience. The current digital landscape is extremely fragmented with an increasing number of vendors and solutions, which are clearly overwhelming to most marketers. The reality is that there is no ‘off-the-shelf’ solution for brands and this is why marketers need help to draft a strategic plan when entering this market.
Where is Programmatic going?
In a recent article, e-consultancy revealed the discrepancies between multiple sources in regards to growth forecasting for Programmatic in APAC. The author thoroughly analysed the numbers before coming to the following conclusions.
- Going by Magna Global and eMarketer’s reports alone we estimate that programmatic ad buying will be around 22% of the digital ad spending in 2018. That is significant, but still probably niche.
- If we, instead, use SOCintel360’s estimates it seems that programmatic will be almost a third of our digital ad budgets. And if that is the case, then there is a much stronger possibility that programmatic will be more of an essential skill for digital marketers.
However, saying 22% is insignificant is probably far from the truth. If you worked 5 days a week this means you would spend 1 day a week on programmatic. You had better know what you are doing!
Despite this contradiction in the data sources and given Programmatic only currently appeals to large companies and niche agencies or trading desks, I strongly believe that Programmatic is going mainstream and will require marketers to up-skill themselves and their team quickly.
How do we improve Programmatic knowledge?
AppNexus 2015 Global Programmatic Trust Study reveals that nearly three-quarters of the ecosystem (71%) now recognises knowledge of programmatic as one of the most important capabilities that agencies will need to possess in five years’ time.
In my opinion, it’s not only for agencies to own this but also brands.
Another piece of research from Smart Insights, eCommerce Expo and Technology for Marketing explores the digital skill gaps on the market today. Out of the eight listed, these are the ones that can make a difference in your business:
1. There is a major skills gap across a range of core digital marketing activities. These include planning: 37% want to improve digital strategy and integrated planning, 35% want to improve their knowledge of planning integrated, multichannel campaigns and 34% want to improve budgeting and financial modelling. Key tactics which marketers wanted to improve their skills levels include affiliate marketing (40%), mobile marketing (39%), SEO (36%) and customer data, insight and analytics (36%).
This means marketers need to develop their strategic thinking and planning across all digital channels. It is for them to own the strategy and brief their agency accordingly. So far, brands have been working in silos and would hire a different agency per channel, disregarding the necessity of a holistic approach across branding, product, marketing and customer loyalty.
2. Paid skills development investment is insufficient in many businesses. For formal qualifications and training, there was inadequate support in many businesses, with around half of respondents rating this poorly: paid qualifications (50% rated company support as inadequate); paid short-term courses (44% negative); paid events and conferences (42% negative).
Despite everyone agreeing on skills shortage in this industry, most businesses do not invest in up-skilling their teams, thinking that hiring millennials or ‘digital natives’ will resolve the issue. The result is both lack of knowledge, lack of understanding and lack of involvement from senior marketers. Therefore, it is urgent for management to shift their investment towards robust training through partnerships with technology companies or universities.
3. Unplanned, reactive management of digital marketing inhibits results and skills development. 77% of respondents favoured a data-driven planned approach to digital marketing based on planning, analytics, and continuous optimisation, but the reality was very different with just 37% agreeing that this approach was used, instead 51% described their approach as ‘reactive, relatively unplanned approach to digital marketing).
This means most marketers continue to do what they’ve been doing until they are asked otherwise, and mostly without understanding the why or the how. As a result, decisions are made without a plan for a successful digital transformation. I’ve heard in many instances that a brand would invest millions in developing a new website only to realise that the platform used doesn’t talk to the customer database. What a loss of money and talent!
Where to from here?
While ad-tech vendors are rushing to demonstrate differentiation, many are facing market consolidation, which is leading to a lack of long-term vision for their business as well as their clients. As a result, we keep raising talent and skills shortage issues without being able to successfully resolve them.
On the other hand, digital marketers are quite frankly struggling to make sense of the numerous technologies promising better reach, targeting, segmentation, conversion and more. They don’t have enough time or enough technical background to make sense of this crowded landscape (see MediaScape) and make ill-informed decisions to deliver the desired outcome simply due to the pressure to become “programmatic”.
Further to that, most marketers are not encouraged to pursue a test and learn approach by their management, even though it has clearly delivered for the most innovative brands in their industries. It is just not the standard practice, and we need to deal with that at C-level.
To be successful, marketers need to build their strategy with key partners, but without relying on them to DO the strategy. In other terms, they need to surround themselves with experts who are technology agnostic and capable of setting up business models that will bring data, creative and media under the same roof.
Adapting and innovating are the key challenges for businesses, not only in terms of their products or services but more importantly in terms of designing a user-centric strategy that places digital at its core. Moving forward, marketers need take ownership and accountability for their results across owned, paid and earned media to stay competitive and be a leader in their industry.