Lessons Learned from our Latest Programmatic Workshop

Blog   |   Operative Team   |   May 4, 2016

Operative hosted its second “Programmatic Yield Curve” breakfast at the beautiful Vine Space at the Eventi Hotel on April 27th. Participants came together to discuss successful programmatic techniques across a range of topics including header bidding, programmatic marketplaces and programmatic direct. Over 40 publishers joined the conversation including Comcast Interactive Network, Bauer Xcel Media, The Guardian America, Hallmark, AccuWeather, Mashable, and Scripps Networks Interactive.

The event kicked off with a conversation between Kevin Bowen, Director of Programmatic Ad Tech & Services at Hearst Corporation and Operative VP of Monetization, Adam Hecht. Kevin has a sales team dedicated strictly to programmatic. Hearst’s programmatic sales team is very structured, broken out by various levels including channel, vertical, and geo, which is unusual for many publishers. That said, Kevin stressed that accountability, which is applicable anywhere, drives more strategic deals, therefore programmatic managers should feel tied to the inventory they are managing similar to direct sales teams. He also drove home the point that using programmatic technology is great, but “Revenue trumps all.” People are still needed to correctly execute the technology to drive revenue. Other programmatic insights that Kevin shared with the audience included:

  • The promise of programmatic automating everything isn’t 100% accurate. Sellers are still required to cold call. Yield managers need to troubleshoot. Reporting – especially meaningful reporting –  can be largely manual.
  • Keep an eye on “real CPM” or rCPM which includes fill rates and compare DFP numbers to programmatic vendor numbers. There are often discrepancies.
  • Evaluate vendors regularly. There isn’t a magic number when it comes to SSP vendors. It all depends on the publisher size and resources at hand. Evaluate what works, what can be managed, and what makes the most money.
  • Forecasting is tough. Hearst updates their forecast on a month-to-month basis but it can be very hard to forecast down to specific site metrics. Kevin’s team focuses on the month at hand then tries to sell what’s left over. It’s also very hard to forecast a preferred deal.
  • It’s harder to monetize lower valued inventory. Buyers have become more sophisticated and their buying behavior is smarter.

Operative’s VP of Monetization, Adam Hecht, and our Director of Exchange Monetization, Matthew Lehman shared additional programmatic best practices that successful publishers employ. Adam and Matt shared tips for making the most of a variety of programmatic tactics like header bidding and programmatic direct. Takeaways from their discussion included the following:

  • Be the master of your inventory. Take advantage of the synergy between DFP and AdX. Be aggressive in approaching the highest bidder to create a deeper direct relationship. Be confident in your pricing and don’t let the market dictate it for you.
  • Programmatic shouldn’t be treated as a threat to direct deals. Go after the best opportunity to maximize CPMs regardless of which revenue stream it comes from. Empower your sales people to earn commission regardless of channel to encourage objective channel optimization.
  • Perform a thorough evaluation on each of your vendors to ensure their capabilities fit your specific needs by platform and by channel. Just because something works for one publisher doesn’t mean it will work for you.
  • When it comes to Programmatic Direct and Private Auctions, think like a direct seller. You have to cold call, establish relationships with agencies, buyers, and trade desks. If not, you’re doing it all wrong.
  • Header bidding can make you more money, but the setup needs to be efficient.  A tight leash on open auction pricing can minimize a latency spike, while reserving header bidding for your PMP deals exclusively provides the best of both worlds.
  • With backfill, partner selection comes down to yield. But beware of double-dipping since AdX and AdSense have the same demand.

We concluded our breakfast with three breakout sessions. Themes included “How to overcome the biggest programmatic challenges” and “The new convergence: How to integrate programmatic and traditional sales.” In the end, we all agreed that programmatic is still a work in progress. There’s not going to be a quick fix, but as long as publishers think about how to best use the technology in combination with the rest of their sales organization rather than practice a “set it and forget it” approach, there’s a good amount of revenue to be made.

Additional Resources:

Programmatic Ad Buying Terminology – one-sheet so you can be fluent in programmatic speak

Operative Compete – learn how to increase your programmatic revenue by at least 30% no matter what level of maturity