Programmatic advertising is an ever changing hot topic within our industry. Some love talking about it, others not so much whilst many are still new to this form of trading digital media. But does APAC lag behind the rest of the world when it comes to adopting this automated process?

REGIONALITY

Firstly, talking about APAC as a whole is difficult; a region with hugely diverse cultures is bound to have differing trends. While some markets such as Australia and China show higher adoption rates that reflect more global mature markets, it is clear this is not necessarily the case across all of APAC.

TECH COSTS

Initial start up costs could be a reason why some less developed markets in APAC are slower to adopt. In more developed markets where the cost of media is relatively high, programmatic tech costs are largely negligible. However in markets where media costs are lower, these tech fees make a larger impact to the total cost of a campaign and some would argue it would make more sense to run IO buys.  

Across the region there is an abundance of supply and cheap buys available without the use of programmatic, which is yet another reason why countries like India and Malaysia are far from fully embracing this technology.  From an advertisers point of view, this does not encourage programmatic trading.  

Additionally on a client specific level, some have found taking their programmatic spend in-house extremely expensive, and these growing pains may well be a step too far for some.

LACK OF EDUCATION

Regional publishers have been relatively successful in trying to monetise their entire inventory. The lowest adoption rates of programmatic are seen within smaller local titles which still heavily rely on managed service. This could be down to cost and technology issues which include “keeping an updated ads.txt file, or integrating into a Google ad server which requires time, money and expertise”.  

However, another more likely reason could be due to lack of education. There appears to be a big opportunity for large vendors to form local market publisher consortiums such as OPPA in Thailand or SMX in Singapore. However it’s worth noting that this strategy did fail in Malaysia when Media Prima pulled out of the market after only 5 months. These consortiums grant access for small titles to sell their inventory and grow market share amongst the common duopoly of Google and Facebook.

PACE OF ADOPTION

Is APAC really that slow at developing programmatic adoption?  To compare, it’s worth looking at how long it took the US to reach where it is now.  APAC markets began trading programmatically later than Europe and North America, so it may not be a question of how fast, but when we began.  Growth of programmatic will be just 13% for 2019 in the US, this is minimal in comparison to the current growth rates we’re experiencing in APAC.

MOVING FORWARD

For programmatic trading to develop, it needs to be pushed forward from all directions. This needs to come from the agency side to promote to publishers and also to vendors. Publishers need to be educated that they can maximise revenue through embracing programmatic technology. There is a general consensus that education, particularly within the local publisher market, is essential for this tech to grow substantially.  

PROGRAMMATIC EDUCATION

So who will be paying for this localised training?  This remains an issue as organisations simply paying for it is not so straightforward.  The demand for training programmes is there, however few want to invest in them. The market relies on industry bodies, ad tech firms and even government investment to ensure these training schemes are carried out, but for now this might mean some smaller markets are missing out on these benefits.

There’s no doubt that programmatic is the best way to buy advertising inventory. Today, a brand or advertiser can trade from any location in the world and buy inventory across any market. Programmatic trading creates transparency across all cost layers involved between an advertiser and a publisher, and it centralises reporting. There are still some barriers that need to be overcome, however we believe that programmatic buying will inevitably become the future of trustworthy and transparent digital advertising.

This thought leadership article was written by IAB SEA+India Programmatic Committee Members, Sanket Sasane, Head of Programmatic and Client Director, iProspect and Steve Rhodes, Agency Partner, APAC, Quantcast.