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BizReport : Advertising : September 01, 2020

Study: Programmatic spending spikes as physical stores shutter

The programmatic ad spend has seen a big spike in spending so far this year, perhaps because of the pandemic and the sheer number of businesses that had to shutter physical locations. Pushing ad dollars online, for buy online/curbside pickup or straight-up ecommerce orders, have been two ways merchants have brands have been able to maintain customer engagement.

by Kristina Knight

According to new data out from MediaRadar the programmatic ad spend is up by 36% so far this year as more marketers turned to programmatic buys to engage consumers stuck at home during the initial months of the COVID-19 pandemic.

"Recently, the executives of big tech companies had a long day defending company practices to lawmakers," said Todd Krizelman, Co-Founder and CEO of MediaRadar. "With these hearings, we thought now would be a good time to check-in on programmatic advertising. In April, programmatic ad spend experienced a slump, but was on the rise by May. How has programmatic fared since then? We dug into our data to find out."

Their data shows that in January the number of brands running programmatic campaigns sat at just under 34,000 but as of June more than 43,000 brands had begun pushing campaigns dollars into programmatic buys. While the spend is up by more than a third from January through June, the experts note the overall spend is up about 11% YoY.

Technology brands, Financial Service brands and Retailers/Merchants led the programmatic spending increase, with half of those running programmatic campaigns from these verticals. However, the biggest spending increases for programmatic buys are coming from education (70% increase in spending) and media (39% spending increase) brands while travel brands have but back the most (70% decrease in spending) during the first half of 2020.

Nearly all (83%) of brands are now allotting a percentage of their overall ad budgets to programmatic spending, up from 76% in January 2019.

One thing that could curtail some use of programmatic is how new privacy features and laws begin to impact the overall digital space. Apple, for example, is set to release new privacy features with the rollout of iOS 14 that will allow consumers to block location tracking and the ability of brands/apps to record consumers without their consent. These changes could impact the relevance of programmatic and other digital ad formats, which could result in a spending decline. That, of course, is yet to be seen.

In the meantime, it is interesting to note that the number of brands continuing to pushing into programmatic is still rising, even as restrictions and lockdown measures are beginning to life. More data from MediaRadar's report can be accessed here.

Tags: ad trends, advertising, advertising trends, MediaRadar, programmatic ad tips, programmatic advertising

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