Will Programmatic Advertising Become Extinct?

By Roy Shkedi, Intent IQ's Chairman



There are a lot of changes happening in the online advertising ecosystem, so much so that it seems that advertising on the open web, also known as “programmatic,” might be headed toward extinction.


A confluence of events, developments, and trends are combining to make programmatic too much of a hassle for advertisers. These include technical challenges like cross-device advertising and attribution, as well as the rollout of new user privacy tools by big tech companies.


Here we’ll explore the challenges to programmatic and discuss why advertisers are less willing to deal with them these days.


Challenges

There are several ways in which programmatic is becoming too difficult for advertisers. These include:

Rich profile, cross-app, cross-site, cross-device targeting - Rich user profiles that give advertisers a fuller picture of their targets, require a lot of time and resources. The same is true for employing cross-app, cross-site, and cross-device targeting.

Frequency capping - Many websites employ frequency capping, a limit to the number of times a specific visitor can be shown a particular advertisement. This is hard on advertisers.

Attribution - The science of determining which marketing tactics led the consumer to make the purchase, is extremely difficult and time-intensive.

Industry Challenged - Big companies such as Google and Apple have come up with supposedly privacy-friendly solutions that will eventually help themselves hold onto their first party data and increase their own revenues. And so, programmatic advertising on these fronts will become so much harder for everyone else.


For these reasons, the industry is on the lookout for the possibility that advertisers will turn away from programmatic and programmatic thus eventually turning it into obsolete.


IIQ’s Mobile Identity Hub Solution

Next generation identity resolution leader Intent IQ is introducing itsI Mobile Identity Hub (MIH) service that enables DSPs to target mobile apps using data from outside the app where the ad is delivered. Therefore, preserving off-app data based targeted ads as a major revenue source for mobile apps. Importantly, Intent IQ does it without the help or involvement of the app developers.

MIH works by clustering mobile apps’ user IDs of each of the apps on a device and providing the cluster along a device universal ID to DSPs. IIQ’s MIH covers over 80% of ad inventory with 90% accuracy.


IIQ’s Browser Identity Hub Solution

Next generation identity resolution leader Intent IQ is introducing its Browser Identity Hub ('BIH’) service, which addresses third-party cookieless environments, such as the one created by iOS Safari or the future Chrome, by stepping in and providing a privacy-friendly universal ID across 80% of sites' cookieless ad inventory, powering targeting & attribution across sites and devices.


BIH’s innovative, proprietary technology truly stands out in the coverage and accuracy it provides. BIH service covers over 80% of ad inventory with 90% accuracy.

By contrast, third-party cookies offer 56% coverage and log-in solutions offer coverage of less than 20%.



Is Programmatic at the Negative Tipping Point?


Looking at all the challenges above, one cannot help but wonder where the industry is headed. Programmatic Advertising is key in supporting the free open web, but the above challenges will make this kind of advertising less efficient and, ultimately, eat into advertiser profit margins. Programmatic will become subscale and might lapse into a vicious cycle from this negative tipping point, causing further decline. And the big winners are the walled gardens again.


To maintain the programmatic/open web space, advertisers need tools that will level the playing field with the walled gardens so they can compete more effectively for ad dollars.