Emarketer's findings have uncovered that advertisers spent more than $10 billion on programmatic fees this year, almost 38% of their nonsocial programmatic display budgets.
Fees earned by the ecosystem of partners that facilitate programmatic transactions in the US were up almost 20% this year according to research from specialized website emarketer.com. Findings have uncovered that advertisers spent more than $10 billion on programmatic fees this year—almost 38% of their nonsocial programmatic display budgets. That was almost $2 billion more than they spent on the “ad tech tax” in 2018, but it does represent a decrease in the share of programmatic display budgets going to fees rather than working media.
Advertisers have spent close to $12 billion on programmatic fees in 2019, or 32.7% of nonsocial programmatic display ad spending. It is believed that this upcoming year, the proportion going to fees will be higher because more programmatic display spending continues to be transacted in the open markets, where buyers and sellers are more likely to use additional services, such as ad verification and fraud detection.
It is also important to point out that advertisers throughout this past year have pursued a number of strategies to drive fees down, including scrutinizing the practices of media buying agencies, demanding better contract terms and reevaluating bidding strategies to focus on buying inventory from trusted sellers and avoiding resellers that don’t add value. These practices have helped reduce fees from more than 42% of nonsocial programmatic display spending in 2016 and are expected to keep dropping.
One theme that continues to develop is the supply side assuming a part in controlling ad tech. Amazon bought an ad server. Roku bought a DSP. Vox Media and The Washington Post are licensing out their home-built publishing and ad technology to other publishers, who have also felt crunched for years by the fact that they were getting a lower share of media dollars than when all ads were bought on a direct basis, but the rise of the choice to build out self-serve ad-buying services also points to a recognition that ease of buying is one important way for them to compete with the likes of Facebook and other 2.0 advertisers.