Programmatic advertising in the digital out-of-home (DOOH) space was initially hailed as a game-changer, promising efficiency and automation in ad space trading. However, the reality has been somewhat different. The rise of the "programmatic manager" role, necessitated by the constant need for human intervention, highlights the limitations of current programmatic systems.
Why is this the case? It boils down to a fundamental mismatch between how advertisers plan campaigns and how programmatic systems operate. Advertisers focus on overarching campaign goals—like reaching a million people in a specific demographic over a set period—rather than optimizing for incremental impressions on a minute-by-minute basis. This discrepancy forces programmatic managers to constantly tweak and balance campaign settings to align with these broader objectives, often leading to inefficiencies.
The current real-time programmatic systems struggle with the complexities of DOOH inventory. Unlike online ads, where impressions are abundant, DOOH operates on a 1-to-many basis—one ad can reach anywhere from zero to hundreds of people. Additionally, audience patterns at physical locations fluctuate based on a myriad of factors like time of day, location, and surrounding demographics. This complexity is difficult for human planners to manage effectively, leading to the reliance on pre-negotiated deals that essentially bypass the real-time nature of programmatic trading.
So, what’s next for DOOH? The future lies in predictive planning powered by AI and detailed analytics. Instead of reacting in real-time, smart systems will forecast audience patterns and allocate inventory based on long-term campaign goals. This approach offers a more balanced and efficient use of ad space, reducing waste and ensuring that campaigns meet their objectives without the need for constant manual adjustments.
However, this doesn’t mean that real-time programmatic has no place in the future of DOOH. It still excels in providing flexible, cost-effective access to inventory, especially for smaller campaigns. The key is diversification—publishers should not rely solely on one sales method. High-stakes campaigns will likely be booked directly with guarantees, while smaller activities can be handled programmatically.
At Adtrac, we’re committed to this vision of a post-programmatic world. Our solutions aim to combine the best of both worlds: the precision and foresight of predictive planning with the flexibility of real-time programmatic trading. As the industry evolves, those who adapt by embracing these advanced strategies will be best positioned for success.
