Programmatic advertising is projected to double its share of podcast industry revenue this year according to the Interactive Advertising Bureau. But at 11%, it still remains a distant third to upfront and scatter market sales, each of which account for about half of the remaining ad dollars placed in podcasting. But looked at from a broader perspective across all digital media, there is good reason for podcasters to put more emphasis on programmatic sales.
Media Radar reports that nearly three-quarters (73%) of digital ads sold during the third quarter were sold programmatically. Even with tighter budgets leading buyers to get pickier where the ads land, and hence an uptick in direct buying versus a year ago, Media Radar says programmatic sales are still the most common. It estimates that $35 billion was allocated to programmatic channels out of the roughly $46 billion in national digital advertising overall. “In a landscape where cautious spending prevails currently, one thing remains consistent: programmatic ad buying continues to dominate the digital space,” it says in an update.
Media Radar says 136,000 companies jumped aboard the programmatic bandwagon by the end of third quarter, buying ads for about 208,000 brands or product lines. Its data shows that 83% of the nearly 165,000 companies that bought digital advertising during Q3 used programmatic channels. And those that prefer it, really use it. Media Radar says several brands including Amazon, Comcast, Hyundai, and Mondelez put 80% or more of their ad dollars toward programmatic buying.
On a category basis, the analysis shows that 11 of the 27 ad categories allocated more than $1 billion solely for programmatic advertising. Leading Media Radar’s list are media & entertainment and retail advertisers, with over eight in ten of their digital ad dollars going to programmatic platforms. It also sees high usage among categories like apparel, food, and beauty.
Those ad categories less likely to use programmatic included home furnishings, including furniture, maintenance items, and outdoor products. Media Radar says they bought less than 60% of their ads using programmatic channels.
For all its dominance, programmatic ad spending is off 13% year to year, with industries such as technology pulling back in 2023. The national ad market has also been uneven. Media Radar notes that there has been a seven percent rise in the total spent on direct buying, which rose to $12 billion in Q3. It says direct has pulled in dollars from categories such as tech, home furnishings, and professional services.
“Media Radar’s analysis highlights that while programmatic advertising has seen a slight decline in 2023, it still makes up the vast majority of digital ad investments. Advertisers across industries continue to lean heavily into ad tech to reach their target audiences,” the analysis says. “For ad sales professionals, these insights indicate that programmatic channels remain crucial for prospecting new business.” Media Radar suggests sales reps focus their attention on categories investing heavily in ad tech like retail, media, entertainment, and apparel brands.