During his three years at Kellogg Company, Bob Arnold became a poster child for programmatic buying at the brand marketer level.
Arnold, who recently quit cereal to join Google, presented his rules for programmatic at the Association of National Advertisers' Media Leadership Conference in Boca Raton, Fla., on Tuesday.
His key message: Don't let complexity deter you from the promise of exchange buying. "Everything that happens between advertiser and consumer is just a technology pipe," he said.
"It's no surprise we're seeing more large advertisers engage in programmatic," he said, because buying this way lifts the odds of hitting the target audience and creative personalization is so much greater than TV. Many of these advertisers are doing "private exchange" or "programmatic direct" deals to ensure inventory quality.
"They know the publisher but they can use all the algorithms, data and other advantages of programmatic," he said.
Here are Arnold's' "five steps to win in programmatic."
1) Break through. "Creative is extremely important. The greatest media strategies and tactics cannot overcome weak creative." What makes strong digital creative? Ads should be clear, concise and compelling. How do you systematize this? The answer is simple and cheap: Do creative testing.
"If you're spending tens or hundreds of millions on campaigns and not testing creative, you're definitely leaving money on the table." And testing legitimizes digital for skeptical brand marketers, proving that banner ads and so forth can change consumer perception.
2) Know what matters. During his years studying, Arnold had one lesson drilled into his head: "Without measurement there can be no improvement."
"People talk about how digital is the most measurable medium of all time. I actually disagree with that. It's very difficult to understand what are the right things to measure. When I started in digital, I made a cardinal sin and assumed click-through rate was a leading indicator for branding."
On the contrary, studies have demonstrated little to no correlation between CTR and goals such as brand lift and sales.
What to measure then? Viewability? "My view is viewability is a necessity, but not sufficient." Post-market campaign results, like surveys, are better.
3) Own what's yours. Understand website and CRM data and have a strategy around it. "Your current customers can be a great predictor of future customers, but you can only do this if you can organize your data." Arnold recommends the FAME method. Choose data that's focused, actionable, manageable and enlightening.
4) Tear down silos. A major automaker wanted to drive online conversions to in-dealership visits but search, social and display – and their associated data – were in different worlds. It brought in a point person to integrate data and build an attribution model.
5) Build your A team. More large marketers are adding internal experts with knowledge of programmatic. That's not necessarily the same thing as bringing programmatic buys "in-house."
"My word of caution for people considering this, and I definitely encourage this, is to avoid hiring junior people who put hands to keyboards in order to change an organization," Arnold said. Rather, he said, you need senior people who understand the organization and can drive change.
Alternatively, make sure your agency relationship is healthy and open.
"If you decide not to bring it in-house, work very closely with your agency," Arnold said. "Today, agencies can get really squeezed by clients from a pure margin standpoint, which is the first and sometimes the only thing clients talk to them about. Instead, ask is my agency transparent? Do they have the skills to help me embrace programmatic?"