Breaking down the future of automated trading
Partner content: Ahead of Mediatel's Automated Trading Debate, Wayne Blodwell, founder and CEO of The Programmatic Advisory, outlines which areas are most likely to influence the industry in the future
What is the future of automated trading? I don’t think there’s one pithy answer that can cover the entirety of that question, so lets break it down into some of the areas we can expect to influence automated trading going forward.
The rise of the machine
Algorithmic trading is gaining traction within major demand side platforms beyond what we have seen previously, and a whole host of third parties are popping up in this area. We know that generally machines lack context of future events and do not have brand sensitivity at their core, so the combination of man and machine will surely dictate how automated trading develops in the coming years.
Whenever someone has a gripe with automated trading (and many do!), it’s often around the lack of financial transparency and the volume of ad fraud. Blockchain promises to disrupt many industries and it could be the answer to the challenge of financial transparency and ad fraud. It’s early days, blockchain is complex, but we should expect some involvement from blockchain companies in the automated trading space in the years to come.
Amazon, Facebook and Google… where to start? Three goliath companies that fly in the face of regulatory pressure and anti-competitive behavior, see growth in ad dollars going through their technologies and owned & operated properties. 80% of all new ad dollars goes to Facebook & Google, and Amazon are gaining strength - what’s the role of these players versus those who are seen to be more supportive of the open web? Time will tell on this one, but these three cannot be ignored.
Who actually pushes the buttons? Who owns the strategy? Who owns the contracts? Who are tier 1 partners versus tier 2? Are consultancies making headway into media agencies business models? There's been a lot of disruption in the service layer in the past couple of years - we can only expect more to come as holding companies rejig their employees and companies to make them more integrated, and independent specialists continue to grow into new areas. Consultancies are upselling media capability off the back of other engagements with brands, but are they strong enough to compete?
GDPR, 3rd party cookies being blocked at a browser level, ICO fines, plus much more are all putting consumers back in control of their data, rather than the fast-and-loose sharing that has happened historically. The ability to transact ads against known consumers is getting harder, and the need for explicit consent is paramount. This is impacting many companies in the space – particularly targeting and measurement providers. Brands once went to automated trading for ‘right user, right time, right message for the right price’, now there are major question marks over how accurate this will be in future.
There are plenty of other areas which may influence the future of automated trading that I haven’t even touched on, and the good news is that on October 7 at the Automated Trading Debate there will be a host of expert opinions which represent the breadth of the industry. Be sure to get your ticket so you don’t miss out.
Wayne Blodwell is founder and CEO at The Programmatic Advisory, an event partner for Mediatel's Automated Trading Debate. More details about the event are available here.