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Navigating Price Parity: Programmatic DOOH Solutions
Discover strategies to tackle price parity challenges in programmatic DOOH, unlocking its full potential for targeted advertising impact.
In the realm of advertising, the landscape is ever-evolving, with technology continually reshaping how brands connect with consumers. One such advancement, programmatic Digital Out of Home (DOOH) advertising, holds immense promise for advertisers seeking to maximize their reach and impact. However, amidst its potential lies a challenge: price parity. Despite the undeniable benefits it offers, the premium associated with programmatic DOOH can present a hurdle for advertisers. But should this be a roadblock? Let's delve deeper.
Embracing Flexibility: A Case for Programmatic DOOH
Australian advertisers are increasingly recognizing the advantages of programmatic DOOH, particularly in terms of flexibility. The ability to trade OOH panels programmatically empowers brands to precisely target audiences based on factors like day-parts and locations. This newfound flexibility enables advertisers to optimize their campaigns, ensuring their messages resonate with consumers when and where it matters most.
Take the example of Mad Mex, a Mexican food chain operating within a modest advertising budget. By leveraging dynamic DOOH at its core, Mad Mex witnessed a significant uplift in sales across its 70 restaurants. The flexibility offered by programmatic OOH allowed them to strategically activate advertising near their establishments during peak hours, driving tangible results.
According to Nick Cook, Mad Mex's GM of Marketing, programmatic OOH perfectly aligns with their business model, enabling them to focus their advertising efforts precisely when consumer engagement is at its peak. This strategic approach not only enhances the efficiency of their marketing spend but also maximizes their time in the market, ensuring optimal returns on investment.
Flexibility vs. Cost: Navigating Price Parity
While the benefits of programmatic DOOH are undeniable, the issue of price parity looms large. Compared to traditional direct buys, programmatic DOOH inventory often commands a premium on a CPM basis. This disparity can be challenging to justify to clients, raising concerns about the cost-effectiveness of programmatic campaigns.
Daniel Cutrone, Founder, and Managing Partner of Avenue C, highlights the price disparity between programmatic and direct buys as a significant challenge. The inherent premium associated with programmatic DOOH can deter advertisers, particularly when comparing the cost-effectiveness of different buying models.
Paige Wheaton, Chief Investment Officer at Initiative, acknowledges the cost implications of programmatic DOOH but emphasizes the importance of strategic implementation. While programmatic trading may entail higher costs, Wheaton argues that its effectiveness lies in its ability to eliminate wastage and precisely target desired audiences. Strategic alignment between campaign tactics and objectives is paramount in justifying the premium associated with programmatic DOOH.
Education and Progression: Unveiling the Value Proposition
Despite the pricing challenges, industry experts remain optimistic about the future of programmatic DOOH in Australia. Brad Palmer, National Programmatic Director at JCDecaux, emphasizes the inherent value of programmatic inventory, attributing the CPM premium to its unparalleled flexibility and targeting capabilities.
Palmer, along with Wheaton and Cutrone, advocates for increased education to foster a deeper understanding of the value proposition offered by programmatic DOOH. While price parity remains a concern, Australia is poised to lead the way in embracing flexible trading within a broader out-of-home media mix.
In conclusion, while price parity poses a notable challenge in the realm of programmatic DOOH, it should not serve as a roadblock to its adoption. Strategic alignment, coupled with a deeper appreciation of its inherent value, will pave the way for advertisers to harness the full potential of programmatic DOOH in driving impactful campaigns and delivering measurable results.
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