Programmatic advertising is the most powerful advertising to come along since search. But, let’s face it, most of the industry’s investment in programmatic to date hasn’t been geared toward local. Development has been largely focused on running a $20,000-dollar-a-day kind of campaigns.
But now the attention is shifting. We’re seeing huge momentum toward local media, which makes perfect sense. Because local advertisers were slower to move to digital, there is enormous pent-up demand. Local digital media, in fact, is expected to grow from a $38 billion-dollar market in 2015 to a $66 billion-dollar market in 2020, according to BIA/Kelsey’s U.S. Local Advertising Forecast, 2017.
And this is Simpli.fi’s focus and our passion: How to bring the power of programmatic to localized advertising. That’s what we spend our days and nights thinking about. So what trends are we seeing (and what are we anticipating) in local programmatic? Here’s a roundup of our top trends to watch.
TREND 1: LOCAL DOESN’T JUST MEAN MOM AND POP
Small and midsized businesses are jumping on the local programmatic bandwagon, but they aren’t the only ones. National advertisers are also eager to expand their local spend (e.g., think about Subway sandwich eaters wanting cheese steaks in Philadelphia and perhaps turkey with avocado in California).
TREND 2: MORE PRECISE, MORE AUTOMATED FORECASTING
Forecasting in our industry has historically been a weakness, but with improvements in computing power, with artificial intelligence coming on board, with the incremental data we are gaining access to, we expect to see more precise forecasting.
And as models generate media plans based on the history of a targeted group and anticipated ROI, we expect media mix planning to become an increasingly automated process that, in turn, will be cross-optimized based on real-time feedback over the course of a campaign.
TREND 3: MOBILE LOCATION DATA IS TAKING CENTER STAGE
Inventory is shifting from desktop to mobile. As an example, on our platform, in January of 2016, the percentage of mobile delivery made up 36% of our revenue. As of last month, that percentage had grown to 64%. As mobile inventory comes on, so too does mobile data.
In the past, the gold standard data was considered to be search data, website data and behavioral data, but now, as more and more mobile inventory and mobile location data becomes available, marketers are able to—and will increasingly be able to—connect offline and online behavior. So this is an emerging trend that we believe will grow increasingly important.
Check back for PART TWO of REIMAGINING LOCAL ADVERTISING IN THE AGE OF PROGRAMMATIC and read about the three remaining trends we see taking hold in localized advertising.