Are there too many programmatic tech companies today?

As programmatic brings efficiency to ad buying and opens up opportunities for many ad tech companies, vendors are popping up rapidly to grab a piece of the ever growing fortune.However, a new research into the programmatic marketplace has found that ad buyers and sellers in APAC are divided over the expansion of programmatic. While almost 9 in 10 (85%) of sellers feel there are too many vendors offering programmatic solutions, less than two thirds (60%) of buyers agree.Overall, three quarters (74%) of all respondents say that there are too many programmatic advertising technology companies today.Adam Schenkel, director and vice President of programmatic at GumGum said: "With each new vendor, comes new technology and implementation struggles, which then turns into time wasted for publishers, trading desks and advertisers; thus, leading to a sense of frustration across the industry."However, James Prudhomme, MD EMEA of Index Exchange holds a different view, he believes that with fragmentation comes greater choice and, ultimately a better partnership.Talking about the disconnect between the buy-side and the sell-side in APAC, Gavin Merwood, director of business development APAC at Teads said: "Programmatic is still in its infancy in APAC and the buy-side is interested in driving programmatic forward so are open to discussion with as many vendors as possible to understand the breadth of opportunity being utilised by other markets more advanced in the space. The sell-side is less incentivised than buy-side to adopt programmatic so they will think too many vendors are calling on them."What is the impact of having many vendor partners?Having multiple partnerships has positive as well as negative effects on businesses. Buyers and sellers see performance and differentiation as the main benefits of having many vendor partners. The most reported negatives are higher operating costs and reduced efficiency/productivity.In every segment, except the APAC sell-side, it saw that consolidation would have a positive effect.The APAC sell-side is 12% points behind the global average — only half of respondents believe consolidation will have a positive effect. However, if the negative effect could be avoided, 85% say they welcome consolidation.The study, conducted by ExchangeWire Research and commissioned by BidSwitch, found the perceptions of buyers and sellers in the APAC region consistently at odds.What do decision makers look for in technology partners?The top three things that are evaluated when looking for a new technology partner are: features, cost and people (cited as ‘very important’ by 86%, 55% and 53% of global respondents respectively).The functional requirements for most programmatic advertising technology platforms are unique to every business, and the requirements are dictated by overall strategy and business goals, e.g. increase brand awareness in the 24–34 years old age group or improve ROI by 10%. This is why ‘features’ is the most important consideration cited by respondents.Will the number of programmatic technology companies grow or shrink over the next 3 years?40% of APAC buy-side respondents think there will be fewer programmatic technology companies in three years time, while 58% of those on the sell-side shared this view.The finding said, programmatic buyers and sellers want the best of both worlds — the efficiency and cost-savings associated with having less, more consolidated partners, but also the transparency, access and single media view across the ecosystem enabled by a more fragmented, multi-player world.The study is based on a survey of 125 digital marketing professionals from around the world, which was sent to ExchangeWire’s subscriber base of digital technology and marketing professionals, and promoted online via the company's website, Twitter, and LinkedIn, during May to June 2016.(Photo courtesy: 123RF)