{"id":17305,"date":"2016-11-18T01:41:41","date_gmt":"2016-11-18T06:41:41","guid":{"rendered":"https:\/\/digital.hbs.edu\/platform-rctom\/submission\/programmatic-as-a-driver-of-digital-sales\/"},"modified":"2016-11-18T01:41:41","modified_gmt":"2016-11-18T06:41:41","slug":"programmatic-as-a-driver-of-digital-sales","status":"publish","type":"hck-submission","link":"https:\/\/d3.harvard.edu\/platform-rctom\/submission\/programmatic-as-a-driver-of-digital-sales\/","title":{"rendered":"Programmatic as a driver of digital sales"},"content":{"rendered":"<p><b>News Publishers<\/b><span style=\"font-weight: 400\"> in today\u2019s globalized and mobiled world face are struggling to defend their revenues. Their business model consists of creating great content and establishing the right structure to monetizing it. Digital advertising is becoming the largest revenue stream for News Publishers (1). Digital Advertising includes both Direct Sales and Programmatic Sales.<\/span><\/p>\n<p><b>Direct Sales <\/b><span style=\"font-weight: 400\">are generated when the publisher communicates directly with the buyer, defines conditions to show their ads (such as volume of impressions) and collects payments afterwards. This operating model involves: sales, ad implementation (otherwise known as ad trafficking), campaign performance reporting and payment collection. Large teams manage each of the previous tasks and manage only significant deal sizes to break even in their operations. <\/span><\/p>\n<p><b>Programmatic <\/b><span style=\"font-weight: 400\">refers to the fully automated and individualized purchase and sale of advertising space in real time (1). The combination of type of inventory, pricing and participation determines the different forms of programmatic advertising. <\/span><\/p>\n<p><span style=\"font-weight: 400\">The resulting combinations are the following. Exhibit 1. Source: IAB (3)<\/span><\/p>\n<p><a href=\"https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2016\/11\/Capture-13.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-full wp-image-17303\" src=\"https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2016\/11\/Capture-13.jpg\" alt=\"capture\" width=\"546\" height=\"356\" srcset=\"https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2016\/11\/Capture-13.jpg 546w, https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2016\/11\/Capture-13-300x196.jpg 300w\" sizes=\"auto, (max-width: 546px) 100vw, 546px\" \/><\/a><\/p>\n<p><b>A new sales channel with increased operational efficiencies<\/b><\/p>\n<p><span style=\"font-weight: 400\">In other words, we can define Programmatic Sales as additional tools that allow the sale of inventory in a more automated way. Programmatic software stacks technology so that operating times in the direct sales model are reduced. Some operational improvements are the following: <\/span><\/p>\n<ul>\n<li style=\"font-weight: 400\"><span style=\"font-weight: 400\">Ad Trafficking is integrated server to server, which means that the advertiser uploads the creatives and can choose when and how to serve them. <\/span><\/li>\n<li style=\"font-weight: 400\"><span style=\"font-weight: 400\">Ad Reporting is also integrated, so both advertiser and publisher can create their automatic reports and the reporting discrepancies are reduced <\/span><\/li>\n<li style=\"font-weight: 400\"><span style=\"font-weight: 400\">Payment collection is guaranteed by the service provider. <\/span><i><span style=\"font-weight: 400\">Note that fees for ad serving and collection service are involved in the process. Fees depend on the ad stack used and can be estimated with IAB\u2019s calculator (4)<\/span><\/i><\/li>\n<li style=\"font-weight: 400\"><span style=\"font-weight: 400\">In addition to these efficiencies, total impressions can be maximized by reducing the percentage of lost impressions. A BCG study shows that these can stack up to 10% of total impressions (5)<\/span><\/li>\n<\/ul>\n<p><b>So why isn\u2019t Programmatic the preferred choice for Publishers?<\/b><\/p>\n<p><span style=\"font-weight: 400\">Some publishers have started to push Programmatic sales, but the current problem most organizations face is that they aren\u2019t extracting enough value out of it. Still today, most of the work in programmatic is being spent in low value tasks. According to a BCG study in Programmatic, \u201cpublishers in a typical month spent an average 11 hours (19 percent of the total staff hours spent on regular programmatic tasks) on value-creating activities, such as generating leads by analyzing bidding data, and 48 hours a month (81 percent of the total) on such purely administrative tasks as monitoring, billing, and reporting. And this does not include the time it takes to make the sale and set up the deal, <\/span><b>only about 20 percent of which is spent creating value<\/b><span style=\"font-weight: 400\">.\u201d<\/span><\/p>\n<p><span style=\"font-weight: 400\">This is a huge problem, because the main value in programmatic is to relegate these tasks to the system and invest time in value adding activities: analyzing bidding data to find additional sales, understanding the sites audiences and packaging them for sale or reviewing bidding strategies to increase CPM\u2019s.<\/span><\/p>\n<p><b>A Brighter Future ahead<\/b><\/p>\n<p><span style=\"font-weight: 400\">Moving forward, publishers should invest in transforming their teams to focus in the high value activities that are available through the Programmatic ecosystem. This would be a combination of data scientists and sales experts. <\/span><\/p>\n<p><b>Sales Experts <\/b><span style=\"font-weight: 400\">help blur the difference between Programmatic and Direct Sales, focusing on what\u2019s most suitable for their clients. Experts set up programmatic deals faster and spend fewer hours monitoring, billing, reporting and in other less valuable tasks. Less time is spent in these activities and can be used to create new sale offers and to drive more revenue.<\/span><\/p>\n<p><b>Data Analytics teams <\/b><span style=\"font-weight: 400\">make sure that data coming into the system is clean and accurate, sift through mountains of data to discover the useful parts, put the discovered data together and organize it so that it\u2019s ready to analyze, take this organized data and create sophisticated analytics models and finally turn the models into results (6). <\/span><\/p>\n<p><span style=\"font-weight: 400\">The<\/span><b> final step<\/b><span style=\"font-weight: 400\"> looking ahead should be to include Data Analytics as part of traditional publishers\u2019 teams. One that is leading the effort is the Financial Times, that leverages their analytic capabilities to improve on their journalists\u2019 investigations. Their team includes data analysts, SEO experts, engagement strategists, social media managers and journalists. The ultimate objective is to get the newspaper out to more people and evolve the newsroom with digital readers in mind (7)<\/span><\/p>\n<p><span style=\"font-weight: 400\">I see a much more promising future for publishers that are focused in reshaping their organization to embrace new technologies. Hopefully this will empower them to deliver outstanding journalism.<\/span><\/p>\n<p>(Word count: 775)<\/p>\n<p>&nbsp;<\/p>\n<hr \/>\n<p><span style=\"font-weight: 400\">(1) \u201cDigital revenue is making up an increasingly large portion of publicly traded newspaper companies\u2019 ad revenue\u201d &#8211; http:\/\/www.journalism.org\/2016\/06\/15\/newspapers-fact-sheet\/<\/span><\/p>\n<p><span style=\"font-weight: 400\">(2) https:\/\/en.wikipedia.org\/wiki\/Programmatic_Advertising<\/span><\/p>\n<p><span style=\"font-weight: 400\">(3) PROGRAMMATIC AND AUTOMATION \u2013 THE PUBLISHERS\u2019 PERSPECTIVE https:\/\/www.iab.com\/wp-content\/uploads\/sites\/4\/2015\/06\/IAB_Digital_Simplified_Programmatic_Sept_2013.pdf<\/span><\/p>\n<p><span style=\"font-weight: 400\">(4) https:\/\/www.iab.com\/guidelines\/iab-programmatic-fee-transparency-calculator\/<\/span><\/p>\n<p><span style=\"font-weight: 400\">(5) \u201cOur analysis found that less than 0.5 percent of \u201cdiscrepancies\u201d\u2014ad impressions that are lost as they pass between different technology platforms\u2014occur with unified technology stacks, while with other technology setups, 3 to 10 percent of impressions are lost between the ad server and the exchange.\u201c<\/span><\/p>\n<p><a href=\"https:\/\/www.bcgperspectives.com\/content\/articles\/media-entertainment-marketing-programmatic-path-profit-publishers\/?chapter=3#chapter3\"><span style=\"font-weight: 400\">https:\/\/www.bcgperspectives.com\/content\/articles\/media-entertainment-marketing-programmatic-path-profit-publishers\/?chapter=3#chapter3<\/span><\/a><\/p>\n<p><span style=\"font-weight: 400\">(6) HBR \u201cFive Roles You Need on Your Big Data Team\u201d &#8211; https:\/\/hbr.org\/2013\/07\/five-roles-you-need-on-your-bi<\/span><\/p>\n<p><span style=\"font-weight: 400\">(7) The Financial Times has a 30-person data team for edit and marketing &#8211; http:\/\/digiday.com\/publishers\/lessons-financial-times-data-maturity\/<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>News Publishers in today\u2019s globalized and mobiled world face are struggling to defend their revenues. Their business model consists of creating great content and establishing the right structure to monetizing it. Digital advertising is becoming the largest revenue stream for [&hellip;]<\/p>\n","protected":false},"author":2331,"featured_media":0,"comment_status":"open","ping_status":"closed","template":"","categories":[],"class_list":["post-17305","hck-submission","type-hck-submission","status-publish","hentry"],"connected_submission_link":"https:\/\/d3.harvard.edu\/platform-rctom\/assignment\/digitization-challenge-2016\/","yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.3 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Programmatic as a driver of digital sales - Technology and Operations Management<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/d3.harvard.edu\/platform-rctom\/submission\/programmatic-as-a-driver-of-digital-sales\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Programmatic as a driver of digital sales - Technology and Operations Management\" \/>\n<meta property=\"og:description\" content=\"News Publishers in today\u2019s globalized and mobiled world face are struggling to defend their revenues. Their business model consists of creating great content and establishing the right structure to monetizing it. Digital advertising is becoming the largest revenue stream for [&hellip;]\" \/>\n<meta property=\"og:url\" content=\"https:\/\/d3.harvard.edu\/platform-rctom\/submission\/programmatic-as-a-driver-of-digital-sales\/\" \/>\n<meta property=\"og:site_name\" content=\"Technology and Operations Management\" \/>\n<meta property=\"og:image\" content=\"https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2016\/11\/Capture-13.jpg\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data1\" content=\"5 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/d3.harvard.edu\\\/platform-rctom\\\/submission\\\/programmatic-as-a-driver-of-digital-sales\\\/\",\"url\":\"https:\\\/\\\/d3.harvard.edu\\\/platform-rctom\\\/submission\\\/programmatic-as-a-driver-of-digital-sales\\\/\",\"name\":\"Programmatic as a driver of digital sales - Technology and Operations Management\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/d3.harvard.edu\\\/platform-rctom\\\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\\\/\\\/d3.harvard.edu\\\/platform-rctom\\\/submission\\\/programmatic-as-a-driver-of-digital-sales\\\/#primaryimage\"},\"image\":{\"@id\":\"https:\\\/\\\/d3.harvard.edu\\\/platform-rctom\\\/submission\\\/programmatic-as-a-driver-of-digital-sales\\\/#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/d3.harvard.edu\\\/platform-rctom\\\/wp-content\\\/uploads\\\/sites\\\/4\\\/2016\\\/11\\\/Capture-13.jpg\",\"datePublished\":\"2016-11-18T06:41:41+00:00\",\"breadcrumb\":{\"@id\":\"https:\\\/\\\/d3.harvard.edu\\\/platform-rctom\\\/submission\\\/programmatic-as-a-driver-of-digital-sales\\\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\\\/\\\/d3.harvard.edu\\\/platform-rctom\\\/submission\\\/programmatic-as-a-driver-of-digital-sales\\\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\\\/\\\/d3.harvard.edu\\\/platform-rctom\\\/submission\\\/programmatic-as-a-driver-of-digital-sales\\\/#primaryimage\",\"url\":\"https:\\\/\\\/d3.harvard.edu\\\/platform-rctom\\\/wp-content\\\/uploads\\\/sites\\\/4\\\/2016\\\/11\\\/Capture-13.jpg\",\"contentUrl\":\"https:\\\/\\\/d3.harvard.edu\\\/platform-rctom\\\/wp-content\\\/uploads\\\/sites\\\/4\\\/2016\\\/11\\\/Capture-13.jpg\"},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\\\/\\\/d3.harvard.edu\\\/platform-rctom\\\/submission\\\/programmatic-as-a-driver-of-digital-sales\\\/#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\\\/\\\/d3.harvard.edu\\\/platform-rctom\\\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"Submissions\",\"item\":\"https:\\\/\\\/d3.harvard.edu\\\/platform-rctom\\\/submission\\\/\"},{\"@type\":\"ListItem\",\"position\":3,\"name\":\"Programmatic as a driver of digital sales\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\\\/\\\/d3.harvard.edu\\\/platform-rctom\\\/#website\",\"url\":\"https:\\\/\\\/d3.harvard.edu\\\/platform-rctom\\\/\",\"name\":\"Technology and Operations Management\",\"description\":\"MBA Student Perspectives\",\"potentialAction\":[{\"@type\":\"性视界Action\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\\\/\\\/d3.harvard.edu\\\/platform-rctom\\\/?s={search_term_string}\"},\"query-input\":{\"@type\":\"PropertyValueSpecification\",\"valueRequired\":true,\"valueName\":\"search_term_string\"}}],\"inLanguage\":\"en-US\"}]}<\/script>\n<!-- \/ Yoast SEO plugin. -->","yoast_head_json":{"title":"Programmatic as a driver of digital sales - Technology and Operations Management","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/d3.harvard.edu\/platform-rctom\/submission\/programmatic-as-a-driver-of-digital-sales\/","og_locale":"en_US","og_type":"article","og_title":"Programmatic as a driver of digital sales - Technology and Operations Management","og_description":"News Publishers in today\u2019s globalized and mobiled world face are struggling to defend their revenues. Their business model consists of creating great content and establishing the right structure to monetizing it. Digital advertising is becoming the largest revenue stream for [&hellip;]","og_url":"https:\/\/d3.harvard.edu\/platform-rctom\/submission\/programmatic-as-a-driver-of-digital-sales\/","og_site_name":"Technology and Operations Management","og_image":[{"url":"https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2016\/11\/Capture-13.jpg","type":"","width":"","height":""}],"twitter_card":"summary_large_image","twitter_misc":{"Est. reading time":"5 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"WebPage","@id":"https:\/\/d3.harvard.edu\/platform-rctom\/submission\/programmatic-as-a-driver-of-digital-sales\/","url":"https:\/\/d3.harvard.edu\/platform-rctom\/submission\/programmatic-as-a-driver-of-digital-sales\/","name":"Programmatic as a driver of digital sales - Technology and Operations Management","isPartOf":{"@id":"https:\/\/d3.harvard.edu\/platform-rctom\/#website"},"primaryImageOfPage":{"@id":"https:\/\/d3.harvard.edu\/platform-rctom\/submission\/programmatic-as-a-driver-of-digital-sales\/#primaryimage"},"image":{"@id":"https:\/\/d3.harvard.edu\/platform-rctom\/submission\/programmatic-as-a-driver-of-digital-sales\/#primaryimage"},"thumbnailUrl":"https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2016\/11\/Capture-13.jpg","datePublished":"2016-11-18T06:41:41+00:00","breadcrumb":{"@id":"https:\/\/d3.harvard.edu\/platform-rctom\/submission\/programmatic-as-a-driver-of-digital-sales\/#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/d3.harvard.edu\/platform-rctom\/submission\/programmatic-as-a-driver-of-digital-sales\/"]}]},{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/d3.harvard.edu\/platform-rctom\/submission\/programmatic-as-a-driver-of-digital-sales\/#primaryimage","url":"https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2016\/11\/Capture-13.jpg","contentUrl":"https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2016\/11\/Capture-13.jpg"},{"@type":"BreadcrumbList","@id":"https:\/\/d3.harvard.edu\/platform-rctom\/submission\/programmatic-as-a-driver-of-digital-sales\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/d3.harvard.edu\/platform-rctom\/"},{"@type":"ListItem","position":2,"name":"Submissions","item":"https:\/\/d3.harvard.edu\/platform-rctom\/submission\/"},{"@type":"ListItem","position":3,"name":"Programmatic as a driver of digital sales"}]},{"@type":"WebSite","@id":"https:\/\/d3.harvard.edu\/platform-rctom\/#website","url":"https:\/\/d3.harvard.edu\/platform-rctom\/","name":"Technology and Operations Management","description":"MBA Student Perspectives","potentialAction":[{"@type":"性视界Action","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/d3.harvard.edu\/platform-rctom\/?s={search_term_string}"},"query-input":{"@type":"PropertyValueSpecification","valueRequired":true,"valueName":"search_term_string"}}],"inLanguage":"en-US"}]}},"_links":{"self":[{"href":"https:\/\/d3.harvard.edu\/platform-rctom\/wp-json\/wp\/v2\/hck-submission\/17305","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/d3.harvard.edu\/platform-rctom\/wp-json\/wp\/v2\/hck-submission"}],"about":[{"href":"https:\/\/d3.harvard.edu\/platform-rctom\/wp-json\/wp\/v2\/types\/hck-submission"}],"author":[{"embeddable":true,"href":"https:\/\/d3.harvard.edu\/platform-rctom\/wp-json\/wp\/v2\/users\/2331"}],"replies":[{"embeddable":true,"href":"https:\/\/d3.harvard.edu\/platform-rctom\/wp-json\/wp\/v2\/comments?post=17305"}],"version-history":[{"count":0,"href":"https:\/\/d3.harvard.edu\/platform-rctom\/wp-json\/wp\/v2\/hck-submission\/17305\/revisions"}],"wp:attachment":[{"href":"https:\/\/d3.harvard.edu\/platform-rctom\/wp-json\/wp\/v2\/media?parent=17305"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/d3.harvard.edu\/platform-rctom\/wp-json\/wp\/v2\/categories?post=17305"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}