Brussels, 23rd November, 2023 — IAB Europe, the leading European-level industry association for the digital advertising ecosystem, has today released its highly anticipated ‘2023 Attitudes to Programmatic Advertising’ Report. The ninth edition of this annual survey offers a comprehensive overview of the current state and future trends of programmatic advertising in Europe.
The survey received 396 respondents from advertisers, agencies, publishers and ad tech vendors in 31 markets, with respondents having both pan-European and Global remits. The majority of respondents were programmatic or media buying specialists. Just under half of all respondents represent buy-side stakeholders (20% advertisers; 24% agencies) and the majority command ad budgets of more than 11 Million Euros, with just over 10% having responsibilities of 150m+ advertising budgets.
Resilient Programmatic Investment
The 2023 survey sheds light on a resurgent industry, rebounding from the dips observed in the 2022 survey. Programmatic investment is on an upswing, especially from the buy side. Notably, 54% of advertisers now allocate over 41% of their digital campaigns to programmatic investment, marking a significant increase from the previous year. IAB Europe’s report on the findings confirm that the digital advertising market remains firmly rooted in its programmatic-first approach, with 58% of non-social display spend transacted programmatically. This resilience is particularly noteworthy amid challenging global conditions, conflicts and escalating inflation.
Operational models are evolving, indicating a shift towards in-housing for advertisers.
While 27% cite in-house as their main operational model, a hybrid approach combining in-house and outsourcing remains prevalent for 42% of respondents. Looking ahead, the report indicates that two-thirds of advertisers are considering bringing programmatic trading in-house in the next 12 months but questions remain on whether there will be the finances in place to make this switch.
Drivers and Barriers to Programmatic Investment:
Cost efficiencies continue to be the primary driver for programmatic investment, particularly for agencies but there’s a notable shift for Advertisers who emphasise operational efficiencies and audience discovery. Barriers to programmatic adoption include concerns about the quality of media and political/economic factors. Notably, agencies show a growing concern for sustainability, ranking it as their top barrier to programmatic investment.
Measurement and Data Strategy:
Traditional metrics such as CPMs and CPVs remain important, despite a growing focus on quality metrics like viewability, fraud, and brand safety. The report highlights a notable increase in the lack of measurement of programmatic campaigns, with 30% of advertisers and 22% of agencies not measuring campaign success.
First-party data usage is on the rise, with 88% of publishers and 81% of agencies utilising it. The industry is witnessing a resurgence in third-party data usage, with 81% of agencies currently using it, a significant increase from the previous year.
Future of Programmatic:
AI emerges as the number one key driver of programmatic growth for advertisers. Publishers identify audio and retail media as their top two growth areas for programmatic. Retail media, especially, gains strong backing from ad tech vendors, with 43% selecting it as the top driver. Connected TV remains a consistent driver for all stakeholder groups.
Progress Towards Net Zero:
In 2023, new questions were included to ascertain stakeholders views on the role that sustainability plays in programmatic advertising. Over 80% of respondents acknowledge sustainability as a strategic focus. Advertisers lead the way, with 44% stating that sustainable programmatic advertising is a key part of their strategy. Agencies perceive progress towards Net Zero, with over half of respondents believing there has been some progress. The 2023 Programmatic Advertising Report paints a vivid picture of an industry not just rebounding but evolving. It captures the resilience, adaptability, and a growing commitment to sustainability, setting the stage for a new era in European digital advertising. The report, written by industry experts from IAB Europe’s membership, forms part of a comprehensive programme of pan-European educational and guidance outputs published by the IAB Europe Programmatic Trading Committee. The full report with accompanying graphs can be downloaded from IAB Europe’s website here.