In an excellent article on Bloomberg, Noah Smith talks about high frequency contracts and the impact this will have on the way our economy works. In the future he envisions, contracts for work will be automatically and in real-time negotiated between machines, according to changing market conditions, performance and competition.
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Like the financial markets, which have long moved from shouting pitchmen in trading pits to high frequency online trading, advertising has moved to real-time automation too. Starting with pay per click advertising in the early days of the internet, the online banner advertising space has now largely moved to an automated, programmatic environment.
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Taking into account the quality of the viewer, the publisher where the ad is displayed and the size of the ad spot (among other things), pricing is set in a real time auction that happens just milliseconds after someone visits a web page. In a perfect world, publishers get the true value of that ad impression and advertisers get as close as possible to one-on-one advertising.
The Value of CMTOs
TV, outdoor and even ‘print’ is going in the same direction. Soon it will be possible to buy and pay for audiences instead of ad spots. Whatever channel their target audience is on, advertisers will have the possibility to target them in a true cross-platform fashion. The possibilities for this type of advertising are endless, and some would say, slightly creepy. But, with the right safeguards in place to guarantee anonymity, this future is closer then we all expect. To keep up with these developments, advertisers should invest in technological experience, and besides working with a good agency, hiring a CMTO (Chief Marketing Technology Officer) could be a good place to start.
At some point in the further future we will see artificial intelligence make decisions around the right message, the right placement and the right frequency of your ads, regardless of the channel. Adjusting creatives in real time while staying true to your brand voice, targeting the right audience at the right time and at the right price, there will no longer be a place for media agencies such as mine. Neither will the world need publishers, with content automation the (technological) real-estate owners will be the only game in town.
It’s a brave new world, and it’s only getting braver.