The Future of Programmatic is Niche

Bart This guest editorial was written by Bart Burggraaf, a partner at MediaGroup Performance, a specialized DSP for the financial services industry. Burggraaf brings previous marketing experience from Citi and Saxo Bank, where he was the marketing manager.

Focusing solely on the financial services industry has given me some insight into the very specific needs that marketers in this industry have. Financial services companies are conservative, have strict legal and compliance requirements, brands that rely solely on trust and complex products that are mostly only suitable for a very niche audience.

And yet, there is a great incentive to make programmatic work for them; Financial Services companies like banks, brokers, funds and asset managers spend an inordinate amount of money marketing their brands. The audience in some cases is very niche and geographically spread. What’s more, financial media is very expensive and buying options are limited.

Products that focus on this niche need to offer premium, brand-suitable inventory that is very targeted, have better – super niche – data available and be priced at a point that makes sense. How do you do that at scale? Well, there are a couple of companies including mine tackling this issue but the larger point I am making is that I believe almost every industry has such limitations and requirements; things that make it unique.

In fact, for every industry but the most mainstream of them, consumers either get their purchase influencing information from specialized publishers or from fragmented information in the mainstream. In the first case, media is often too expensive and we need to extend the audience to increase ROI. In the latter case, marketing to a niche audience that gets their information from the mainstream requires targeting very specifically in order not to waste a big percentage of ad spend. And that’s just one part of the ecosystem that would benefit from a niche focus.

The counter argument usually goes something like; “We have smart algorithms that will figure this out at scale and any human intervention will only limit results and learnings” but that doesn’t take into account that for many niches, the kind of data, private networks and publisher white lists required to make it really work are not available.

With the growing ‘democratization’ of access to inventory and the need to differentiate as a DSP, to add value above and beyond what a marketer can do in-house, I feel the future of programmatic is a focus on Niche products beyond what a large and undifferentiated platform can offer.

marketingAds_perform_021414 (1)