Programmatic investment and revenue within the Japan and Asia Pacific (JAPAC) region has witnessed a surge with over 70% of firms increasing their programmatic activity from 2021, and a tenth of respondents increasing their programmatic activity by more than 75%. This is according to a new research report, The State of Programmatic in JAPAC – 2022, published by OpenX and ExchangeWire.
Southeast Asia and India are among the fastest growing digital economies in the world, Priya Bhatia, vice president – business development, Southeast Asia, OpenX, said. “With the proliferation of new mediums, programmatic is proving to be a critical channel for marketers. We foresee strong growth in programmatic over the next few years as marketers look to maximise their ad spend and trust and confidence in the technology grows,” she added.
Building on trends from 2020 and 2021, digital advertising professionals representing brands, agencies and publishers in Australia, India, Indonesia, and Japan were surveyed. Alongside programmatic activity, the report examines market reaction to identifier deprecation, the evolution of header bidding usage, and attitudes to direct approaches from demand-side platforms (DSPs). Supplementing the statistical findings, the report also includes analysis from thought leaders at Microsoft, Times Internet, and Xaxis. According to Bhatia, fears around the impact of identifier deprecation are growing, revealing that more needs to be done to alleviate worries. “As brands and agencies figure out how they can use first-party data to target customers in digital advertising, adtech partners will play a key role activating those strategies,” she added.
As per the report, publishers have matured in their strategic selection of header bidding partners, while the use of prebid has seen a sharp decline. When compared to 2021, the report highlighted that more respondents are using fewer partners – 61% using up to nine partners (up by five percent) and 24% using 10 or more partners (down by nine percent). Moreover, the use of prebid solutions is down to 12% compared to 33% a year ago. This is most prominent in India, where no respondents reported using prebid in 2022 as compared to 50% using it last year.
Interestingly, fraud and quality concerns remain high (89%) in JAPAC. Similar to 2021, the Indian market displayed the highest concern with 99% showing some concern, followed by Australia (94%) and Indonesia (86%). Concerns are increasing in Japan, with 42% very concerned (up by 10%). In response, a majority of buyers (80%) have run a supply path optimisation (SPO) review in the past 18 months, with 34% indicating that it was the first they have ever done. India is the most active market with 86% having run an SPO review in the past 18 months. Japan is seeing a steady annual growth in SPO reviews from 34% in 2021 to 50% in 2022.
The report also pointed that buyers are now funneling a higher proportion of their media spend through programmatic than publishers are generating revenues via programmatic. 72% of buyers reported an increase in spend compared to 56% of publishers who saw an increase in revenue. This marks a reversal from last year. Further, 85% of buyers now have access to first-party data, up five percent from 2021. Despite being relatively mature programmatic markets in JAPAC, Australia (15%) and Japan (31%) have the lowest proportions of respondents with access to first-party data, and the highest proportion (both 32%) of those who believe there are no appropriate solutions for activating their first-party data assets on the open web.