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Transcript
making sense of programmatic advertising in fashion. 1 2 contents. what advertisers will get from this report: An introduction to programmatic advertising 4 An understanding of its value for fashion brands 5 Programmatic formats and platforms 8 Targeting options for fashion retailers 11 The future of data-informed campaigns 14 Q&A - Common questions about programmatic advertising 16 3 introduction. Programmatic advertising is a hot topic right now, as an everincreasing percentage of marketers look towards using it to achieve their digital marketing goals. Figures from the Internet Advertising Bureau (IAB) showed that programmatic advertising in the UK surpassed the £1 billion mark in 2014, doubling year-on-year; display advertising, primarily served programmatically, exhibited faster growth than search advertising once again. Fashion retail is a fast-paced, ever-evolving sector that has seen digital platforms play an increasing part in the customer journey. A complex range of products and a high level of competition create a key role for programmatic advertising to help brands keep pace and enable them to serve products to consumers in the most efficient way. It is clear that programmatic advertising is here to stay. It offers fashion brands unparalleled targeting and reach with the added benefit of measurability. 4 what is it, and why should brands care? There are a lot of uncertainties as to what Traditionally, advertisers would contact programmatic advertising is and what it involves. websites such as Vogue.co.uk and negotiate At its simplest, programmatic advertising is the advertising space, usually alongside use of automated software to purchase digital ad particular content. However, with over two space. It follows a set of rules to determine when million websites now on the Google Network an impression should be bought on a webpage (or alone and countless millions across the other media). This set of rules constantly evolves online market, it is not possible to create as brands learn more about their customers, and relationships at this scale. These partnerships as the marketplace changes. can exist for large or well-targeted websites, The process is almost fully automated because there are near-infinite possibilities to bid for online advertising space, and this simply can no longer be done with traditional methods. but the efficiency of scale across the entire network makes programmatic advertising much more appealing to most advertisers. 5 the reach of programmatic advertising. If brands manage their advertising programmatically, they can bid for the vast majority of appropriate placements across the online world. Advertisers are faced with a wealth of placement Missguided could therefore effectively serve over opportunities. For example, when Missguided ran 42 million ads next to sportswear content alone, its sportswear campaigns in January, it could although an advertiser would generally break this have targeted healthy living topics, women’s down further to ensure that the content is as running themes and New Year’s resolution content relevant as possible. as well as sportswear and fashion content. To provide a sense of scale, table one shows some examples of fashion related content and how many unique devices will browse that content in an average month. It also shows how many impressions are available, which is essentially the number of opportunities to display an ad to a user while they are visiting a web page. table one: average unique devices and impressions per month Category Unique Devices Impressions Available Clothing 39.5 million 570 million Women’s Clothing 6.72 million 52.7 million Footwear 7.2 million 55 million Sportswear 5 million 42.1 million Jewellery 4.34 million 30 million Men’s Clothing 1.67 million 12.3 million Lingerie 1.5 million 7.72 million Children’s Clothing 1.23 million 7.84 million (Data: Google DoubleClick) 6 Programmatic advertising boasts huge reach, its relevance and likely performance are fully and considering the increasing role of digital automated, and brands will employ a trading platforms in the customer journey, it provides a team to feed in information about the cheapest great opportunity for brands to engage with a seller of that space which will change across the large portion of their target market at a crucial day in an environment closely resembling that of time in the customer’s path to purchase. a busy stock exchange. Consider the complexities of bidding for this As the opportunity to reach more people across advertising space when new website content is a wider range of sites increases in scale, so too being generated constantly and audiences are does the amount of data brands have on the constantly changing their browsing habits. The audiences and individuals they respond to, how only option to really reach them is now through they behave, when and where they are, and what programmatic means. Decisions of how much their other behaviours are, providing a greater to bid on any given advertising space based on amount of insight from display activity. summary of benefits Traditional Programmatic Time Slow Instant Resource High Medium Cost High CPMs* (£25+) Medium-to-Low CPMs (£0.80 - £2.50) Reach Low High Optimisation Limited (Post Activity) Constant (Real Time) Audience Data Limited Extensive and Real Time *CPM stands for cost per 1,000 impressions Programmatic advertising offers a host of advantages over traditional ad buying. These points are discussed in more detail throughout the report. 7 programmatic formats. An ever-increasing range of formats are available to buy programmatically and can run across mobile, social, desktop, and video inventory. desktop social The most common format for ads bought It is no secret that free social advertising programmatically is through desktop display. is becoming more difficult for brands. For an industry that relies heavily on product Commercialisation of social channels is a imagery, desktop display provides a great significant driving factor for budgets being channel for brands to get their products in front channelled towards paid social; Facebook in of interested consumers. particular has pushed social as a major category mobile in programmatic advertising. Facebook’s exchange lets brands serve ads in the news feed programmatically, and it is also helping to drive The IAB found that mobile accounts for over 30% of all programmatic ad spend, which is mainly driven by app downloads. Search queries for the clothing sector are up by 51% on mobile devices (Epiphany and Google data) and we expect that mobile ad spend will continue to increase. As in-feed advertising becomes more widely available across content commonly accessed via mobile devices, there is a great opportunity to reach customers on the go. 8 social spending through mobile/tablet devices. video Video advertising increased 59% year-onyear in the first half of 2014 and mobile video advertising became the fastest-growing digital ad format. Video on web, mobile and even television can be served programmatically. Formats for video range from pre-roll and midroll ads served against video content, to inbanner video and richer formats with multiple engagement points within the ad unit. native M&S Sleepwear basic banner ad Native adverts are incorporated into the flow of editorial content. They allow brands to deliver tailored and real-time messages, direct to customers in a highly shareable way. Appearing in feeds means that native advertising lends itself perfectly to the increasing opportunity across mobile, which is all about in-feed advertising. creative adverts Across different platforms and devices, advertisers can access a range of creative formats. Basic banner ads, such as this example from M&S Sleepwear, are the most common format and good for driving reach and frequency at a low CPM, delivering new users to a website or bringing them back to convert. For brands wanting to create more impact and drive brand awareness, rich media ads can be used. Although these can have a higher CPM, they often attract a higher click-through rate and allow advertisers to get creative. These types of ads can be particularly useful if there is a specific call-to-action that needs to be achieved. This example from Missguided is Missguided’s expandable rich media ads will attract better an expandable ad and shows customers its customer engagement than a standard banner advert. products, latest campaign video, newsletter sign-up and its social channels, allowing engagement with the brand within the ad unit itself. 9 large formats It is possible to buy large format and expandable unaware that these can be bought and traded on units such as mastheads (like the example from a low CPM, so it is still currently possible to take Diesel), double multi-purpose units (MPUs), advantage of a less competitive market and and page takeovers on a programmatic basis. deliver high-impact ads on a low budget. It is not so widely used as advertisers are often dynamic ads Programmatic advertising lends itself to greater granularity and segmentation, which in turn allows for more relevant messaging. The most efficient way of delivering many messages to multiple audiences is to automate the process. Dynamic ads use the feed of a website to automatically create ads from the assets, tailoring to different users based on a number of factors – on-site behaviour, abandoned baskets or a user’s location, to name a few. This Levi’s advert pulls in product images that 10 a customer is likely to buy based on previous This dynamic ad is effective at re-engaging with browsing activity on its site. non-converting customers. using programmatic targeting. Targeting is one of the strongest USPs of programmatic advertising; it gives brands the ability to accurately target and test very specific audiences and report on the results, which is hard to find through other channels. It is possible to apply greater layers of targeting with programmatic methods, for example bid modifiers. If we are targeting a fashion enthusiast reading a fashion blog between the hours of 6pm and 7pm and we know that is when they are more likely to convert - and at a higher average order value - we can then afford a higher bid to serve that user an impression. This can apply to ads across all channels including desktop, mobile, social and video. This report uses two audience profiles to highlight the targeting options available and the difference in strategies between low and highend fashion audiences. It also shows insight into how programmatic can open up overlap analysis, e.g. what else is my audience interested in? What holidays do they take? Do they work full-time or part-time? Which financial products do they use? What car brands do they prefer? All these learnings can then be harnessed to find a brand’s audience beyond the obvious places and help inform its marketing strategy outside of display advertising. 11 luxury brand example targeting and tactics Contextual: Appear next to relevant content e.g. fashion week editorials, best buy guides, and Example target segments for high-end fashion retailers: relevant content in relation to luxury goods and an affluent audience. • Designer spenders Placement: Create a target list of premium • Purchasers of luxury brands sites to appear at a much lower CPM e.g. Vogue, • Purchasers of luxury goods Vanity Fair, Harper’s Bazaar, the Times’ fashion section, blogs, and portals. • Net worth Device: Consider audience and messaging; will • Household income they be commuting, or out and about with their • High-end magazine websites mobiles? Are they more likely to respond from tablet or desktop, and what time of day will be • High-end restaurant diners the best time to get in front of them? • High spend on beauty treatments Audience data: Use data to identify users • Purchasers of designer handbags, jewellery in the market for specific luxury brands or competitors, based on net worth, lifestyle attributes and purchase behaviours. Trend data: Use outside feeds e.g. harnessing social media hashtag buzz indicators around events such as London Fashion Week, or use programming, Google trend data, market stats or weather to inform a bidding strategy or messaging e.g. higher frequency of ads when users might be planning their outfit for the weekend or a special occasion. 12 or watches • Sports e.g. sailing or golf • Class of travel e.g. business class, first class • Affinity with certain brands e.g. Net a Porter • Sites e.g. Times fashion, Vogue, Harper’s Bazaar, Vanity Fair, luxury portals and blogs V V high-street example targeting and tactics Contextual: Appear next to relevant content e.g. fashion week editorials, best buy guides, Example target segments for high street fashion retailers: relevant content in relation to affinity goods and less affluent audience. • Online e-commerce sites Placement: Create target list of premium • Fashion blogs sites to appear at a much lower CPM e.g. • Celebrity news and gossip entertainment category, fashion magazines. • Jobs Device: Consider audience and messaging; will • Affinity with particular brands e.g. Topshop targeting them nearer to payday get a better • Income • Sites e.g. celebrity news and gossip, fashion blogs, celebrity news and gossip, news sites, response? What time of day are they online and receptive to advertising? blogs, look magazine, Glamour magazine etc Audience data: Use data to identify users in the market for high-street brands, which can Data available can help strategists decide which include the use of income levels and job types. of these options would be most effective for a brand. For example, an advertiser can get an idea Trend data: Use outside feeds e.g. harnessing of the demographics of a site’s visitors, such as social media hashtag buzz indicators around age group, gender, social grade, income, location, events, or use programming, Google trend data, popular times for traffic, and devices used. market stats or weather to inform a bidding strategy or messaging e.g. a higher frequency of ads before summer holidays to promote a new season range. 13 the future of data informed campaigns. First-party data is becoming an increasingly important point of differentiation in programmatic campaign planning. Still a significantly under-utilised tactic, the segmentation and integration of CRM data into retargeting strategies provides the possibility of hyper-personalised targeting. Done effectively, this can have a significant impact on the lifetime value of customers. If, for example, a brand knows that a segment of its customers purchases multiple items of clothing from a specific brand or designer each season, the same segment of customers can be targeted with precise designer-led creative upon launch of their new season range. Similarly, if a segment of customers is predictable in when they buy certain items, the timing of the targeting could be such that they are captured when they have the highest propensity to convert. Taking this a step further, more complex customer data-modelling techniques can be employed, similar to those seen more commonly in personalised email marketing and website content. As an example, if a brand knows that a customer has bought a particular item or set of items, and its other customers’ behaviours show they are therefore likely to purchase a specific other item, they can be targeted programmatically with creative content focused on this additional product. More simply, this technique could be used to re-engage with dormant customers, with bids or cost set to take into account the likelihood of them making further purchases. Advancements in data management platforms (DMPs) and the programmatic technologies operated by media owners and demand-side platforms (DSPs) are bringing this approach to a more mainstream audience. The ability to identify groups of people while they browse online, targeting them based on what is known about them as customers, enables brands to target creative towards them in a highly personalised way. The technology, however, is just the starting point. Success in this area of programmatic advertising is extremely dependent on the quality and complexity of a brand’s data modelling and customer segmentation. Getting this wrong and targeting customers with irrelevant creative could easily have a negative impact on customer value and brand perception. 14 Of course, it is also advisable to consider what could be deemed as ‘too personal’. If customers are uncomfortable with just how relevant the targeting is - such that they feel they may have been personally identified - this too can have the exact opposite of the desired effect. 15 q&a: what fashion marketers want to know about programmatic advertising. Q: Can an advertiser ensure that inventory is brand-safe? A: The move to programmatic means placements and reviewing the content are no longer selected manually, and so the concern is placed on whether ads are showing against safe content. There will always be a certain level of risk involved when marketing on such a scale, but most technology introduces a classification system to ensure placement quality remains high and free of high-risk content. Additionally, the use of negative contextual targeting can allow advertisers to stop their ads appearing next to specific negative content. It is possible to create individual deals with premium publishers (PMPs) that essentially guarantee content or large formats on their sites and trade it programmatically. If a site is performing well or it is a site a brand wants to associate with, this is a good way of guaranteeing more brand-safe inventory, but at a lower cost than going direct. Q: How will an advertiser know if it’s appearing on good-quality sites? A: As the programmatic method of buying display advertising has grown, it is no longer the case that it is only ‘remnant’ impressions that are traded. All major publishers now make their inventory available so brands can appear on premium publisher sites at a fraction of the cost of buying directly. The IAB has introduced verification and publisher guidelines to ensure that ad quality is monitored. In addition, all good platforms and partners have sophisticated tools with ‘brand safe’ features to ensure adverts only appear on quality sites. It is also possible for an advertiser to manage this by creating a blacklist of sites and categories they do not want to appear on. It is essential to select the right partner that can answer these questions and put measures in place to protect a brand. 16 Q: Is wasted ad spend a concern? A: The real-time optimisation programmatic advertising allows means that wasted ad spend is minimal. If an advert is not being seen by its intended audience, then it will not perform and it will be stopped, meaning advertisers can buy more of what works and less of what does not with every passing second. This favours programmatic over traditional methods where advertisers would have to pre-purchase a number of impressions with no way of stopping adverts if they turned out to be poor quality. Furthermore, in order to grow campaigns, it is essential to try new placements and assess Q: Where does the human aspect come into programmatic? their value. This is speculative spend that allows A: There is a misconception that programmatic advertisers to find new customers, but will advertising means a computer is running a lead to a small level of wasted spend. The key campaign without any need for human input. difference is that with traditional methods, an However, the algorithms alone are not clever advert may only appeal to 50% of a website’s enough to run for long without losing efficiency, user base and therefore waste 50% of spend, mainly due to budget and marketplace changes. but with programmatic means, adverts can be tested and refined quickly, and so wasted spend Firstly, impression prices fluctuate across is limited to less than 10% in reality. different buying platforms, and so changing the platform that impressions are bought through is how maximum efficiency is generated. However, Q: How do advertisers know if someone has seen a display ad? no tool is able to see these price changes in advance, so human intervention allows preemptive changes to cheaper platforms. A: An ad impression takes into account the fact the ad has loaded on a given page. It is possible There are also large changes in online behaviour to use frequency caps and time lag analysis to caused by external factors such as news stories, assess the optimum number of times to show weather patterns, holidays, fashion trends and so an individual an ad before they take the on. This cannot be accounted for in an algorithm desired action. that is based on known data. Therefore, there is a need to tweak bidding algorithms to account for The IAB has published a new metric based on market changes. ad viewability. It is now possible to identify the exposure an individual has had based on size, Finally, business objectives change regularly placement and number of seconds viewed. This to deal with things such as sales, designer allows some negotiation with the bidding to trends, competitor activity, new season stock, ensure that advertisers are paying for ads that etc. This requires changes in budgets, targets a user is more likely to have seen. It is important and display strategy. to run benchmarking tests with lower viewability measures to see what kinds of placements and exposure work for a brand. 17 conclusion Programmatic advertising provides a great opportunity for marketers to reach the right people, on the right devices, at the right time. It can be used to keep pace with an ever-changing audience in an effective, trackable and efficient way. There is an opportunity for brands to use their customer data to create more effective Report Author: Emma Ashby, Display Manager, Epiphany campaigns. The ability to target specific segments through programmatic advertising With 13 years’ experience in display and media provides marketers with a powerful way to management, Emma has managed data driven, engage with their customers. The more a brand tailored and integrated campaigns for clients knows about its customers’ online behaviour, across the fashion, finance, travel, charity, retail, the easier it becomes to reach them. B2B, e-commerce, higher education and FMCG sectors. Programmatic advertising lends itself to using current customer data to inform campaigns, but also helps to discover and test new customer segments without risking significant amounts of advertising budget on untested territories. If you would like to learn what programmatic advertising could offer your brand, feel free to email us on [email protected]. 18 19 epiphanysearch.co.uk 0800 019 9727 [email protected] 20 Leeds Office London Office The Small Mill, 31-35 Kirby Street Chadwick Street, London Leeds, LS10 1LJ EC1N 8TE