If the increase in programmatic trading leads to standard ad formats becoming “too commoditised” there’s a risk publishers will ditch them in favour of more content-led advertising, according to Dennis Publishing’s head of digital sales Gary Rayneau, in an interview with The Drum.
Although Dennis – which owns brands such as Auto Express, The Week, Men’s Fitness and Computer Active – has been increasing its programmatic capabilities in recent years, the technique currently only represents four per cent of revenue, although direct display advertising still brings in the majority at 70 per cent. The rest comes from native advertising/branded content and partnerships.
While Rayneau said the company would continue to develop its programmatic offering, he said Dennis was “purposely late to market” and currently programmatic trading is only an option for direct-buy clients.
“Our door is definitely open with clients to work programmatically but that has to be in conjunction with direct spend,” he said.
“I think it will become the default way of buying impressions if the focus is direct response, and across the industry it absolutely is and I completely understand the legitimacy of programmatic from that perspective.
“On the other hand I also think direct buys will always have a place, especially for brand-led advertisers and vertical sites. I think programmatic will be the final nail in the coffin for your average network and portfolio sales, but if you’re a publisher with a highly specialised niche audience then there’ll always be a place for direct buys and brand related stuff.”
He continued: “I do see a point where if display advertising becomes too commodotised we’ll get to the stage where we won’t run standard formats and we will just run partnerships and native placements.
“I think it would be a much better experience for the user, and it will generate the same, if not more, revenue that way as well. It just won’t be worth our time to run standard display.”
Rayneau said he believed such an event was a real possibility and pointed towards the Buzzfeed model – which is funded by native advertising – as an example of how other ad revenue streams are practical.