Programmatic digital ads now account for almost 80 per cent of total ad spend on mobile in the US, and the process of using software to purchase ad content is set to be worth more than $45 billion (£35 billion) before the end of the decade, according to a new study published by research enterprise eMarketer.
Programmatic methods have come under fire in recent weeks following the revelation that some online ads were being placed against extremist and other unsavoury videos on YouTube channels, which prompted a mass exodus of big brands such as Jaguar Land Rover and Thomson Reuters.
Despite the risks involved with the process and its potential impact on brand safety, there are no signs that programmatic is set to slow down in the near future. The study shows that marketers will mitigate the risks by focusing the vast majority of their US digital display ad dollar spend on direct setups and private marketplaces in 2017. Direct buys are set to account for more than half of ad purchases this year.
“Private setups give buyers and sellers greater control over their automated buys,” eMarketer principal analyst Lauren Fisher said in a statement. “They may have initially served to bring in reticent buyers and sellers, but now private setups drive much of the change and momentum in the marketplace as both parties seek greater control from their programmatic efforts.”
It is no surprise to see programmatic taking up a huge chunk of investment on mobile, and eMarketer has forecast steady growth in this area until the end of the decade as brands look to place 30-second spots and other high-quality ad content within apps and social to engage with consumers on always-connected smartphones.
eMarketer noted that trustworthy and private methods of purchasing programmatically will see the highest rates of growth in the coming years. While marketers in the US are going big on programmatic, research from the IAB last year suggested that the UK hasn’t been as quick to adopt the method, as only 50 per cent of marketers have bought mobile inventory this way, and 44 per cent are unaware of the benefits.