Amy Maxwell, digital project manager (creative solutions), at British Vogue, explores some of the reasons why brands in this sector are reluctant to dip their toes into automated buying, spells out some of the realities facing the luxury sector, and points out how the programmatic sector has to offer more.

Within the digital media space, the luxury sector itself is usually pigeonholed as ‘playing catch-up’ and noticeably absent within programmatic advertising forecasts. Luxury brands are fascinating, often turbulent, and all striving for uniqueness – therefore it poses the question; why should their advertising be doing anything less?

I have worked agency-side with brands such as Burberry, Tommy Hilfiger and Calvin Klein, plus client-side for Bally, before my recent move to British Vogue. All of the above brands (most of the time) have shared the same common theme of wanting to: 'be there first'; or 'do it better than the rest'.

The problem that programmatic poses in this respect is that the technology is great for buying cheaply, on a mass scale and learning about your audience, but what it doesn’t do currently is ensure the same stand-out impact as a direct buy can bring.

Ad misplacement no longer a crippling fear

I personally don’t think the reason luxury brands are not buying programmatically is down to the worry about appearing within dodgy environments anymore either, as most luxury clients have been educated by their agencies on the wonders of private marketplaces (PMPs) to death.

Luxury brands are already running programmatic activity, including the likes of Burberry and Calvin Klein (who have arguably been ambassadors within this sector). Whereas brands with more flexible budgets often have the luxury of strategically placing programmatic underneath the funnel of more impactful advertising, using programmatic to cover reach and re-targeting.

The realities of the luxury sector

However, for most luxury brands, times of a retail boom are a distant memory and it’s arguably never been a more turbulent and uncertain time within the sector.

The reality is, brands are fighting in an unsettled landscape to break through so many barriers; whether it is creative directors switching from one brand to the other at the drop of a hat; the Chinese not spending on fashion retail overseas as predicted; or the economic hullabaloo after Brexit.

This means that advertising budgets in this sector are more stretched and frugal than ever before. Potentially programmatic could pose as a solution here, due to its cheaper inventory appeal to clients. However, it still doesn’t give the stand-out appeal and edge that a direct buy/custom solution can.

In an ideal scenario, programmatic would run alongside direct buys. However, chief marketing officers are under so much pressure to deliver quick results that a solution of running programmatic alone may indeed bring scale, but not enough substantial cut-through and quick-term margin that standout custom solutions can bring.

There are often a number of reasons why this might be the case, including having difficulties finding quality data sets for targeting within a PMP environment.

Plus, on a longer-term basis within the digital market, in order to stand out against the Burberry’s of this world (a brand which is already established as the driver of digital innovation) brands need to find new ways of differentiating, or face being drowned out.

So, what exactly needs to change, in order to sell programmatic to the luxury market?

Running programmatic through an agency trading desk should (in theory) be the most cost effective way of buying, due to their unbiased links to DSP (demand-side platform) and DMP (data management platform) inventory.

However, the landscape is still fairly restricted with what inventory the desks can obtain through the various DSPs. The digital space has also got to the stage where it is so cluttered that buying an impression-based bundle of banners on your media plan just isn’t going to get you much bang for your buck, especially if you’re looking to engage on a deeper level with your audience.

In my opinion, agencies should be doing more to work with publishers, such as the Conde Nast and Hearst to create more formulaic and thought-out deals that offer inventory which goes past just running a standard ad bundle. These publishers might not be at the stage of trading homepage takeovers programmatically, but what else could we all be doing to push the boundaries of the technology?

Time and time again in the luxury space, I feel like we’ve heard the excuse that brands just aren’t up to date and willing to move budget from print into digital. This is an old adage – it is happening, at a rapid pace. But when it comes to automated advertising, we need to offer them more.

One thing that needs to improve are the formats and environments we are offering to our luxury clients, in particular mobile and social channels, which are hugely popular within this space should come as a priority. Then the agencies need to continue to push forward technology enablers with the likes of Facebook and Google to continue to integrate seamless transitions of tracking cross-device.

Whether we like it or not we need to accept that within the realm of luxury advertising, clients have always demanded more of digital. So why should they settle for anything less when we’re talking about programmatic?

Amy Maxwell, is digital project manager (creative solutions), at British Vogue she tweets at @amyloumaxwell.