IAB Europe has again released its annual 'Attitudes to Programmatic Advertising' report. The report provides a comprehensive analysis of the state of programmatic advertising in Europe, covering trends, growth drivers, barriers, and future forecasts. If you work in programmatic, we recommend checking out the report. To make it easier, we've compiled what we believe are the key insights:
- A significant 51.9% of non-social display advertising is now purchased programmatically, with over half of advertisers and agencies allocating more than 41% of their budgets for display, mobile, and video campaigns to programmatic channels.
- The hybrid operational model—which blends in-house expertise with external resources—remains the most popular approach, though in-housing is a growing trend.
- Audience discovery has emerged as the primary driver for programmatic investment among advertisers, while agencies continue to prioritise cost efficiency. Major barriers include media quality concerns, political and economic uncertainties, and sustainability considerations.
- Metrics are shifting from traditional measurements, like CPM and CPV, toward quality-focused metrics such as viewability and brand safety. Meanwhile, as reliance on third-party cookies declines, first-party data and contextual targeting are gaining prominence.
Looking forward, artificial intelligence, Connected TV (CTV), and retail media are seen as key growth drivers for the future of programmatic advertising.
Investments and strategies
IAB Europe's AdEx Benchmark 2023 study (published in June 2024) reveals that the European digital advertising market, valued at €96.6 billion, continues to prioritise programmatic approaches, with 51.9% of non-social display advertising now purchased programmatically. While programmatic display remains dominant, investments are increasingly directed toward new channels like Connected TV (CTV) and retail media, driven by changing viewer behaviours and privacy concerns. The 2024 report reaffirms this trend, with advaertisers and agencies expanding their programmatic investments in mobile, video, and emerging formats, underscoring programmatic's growing significance.
A significant share of advertisers and agencies now programmatically purchase over 41% of their display, mobile, and video campaigns. The display continues to command solid programmatic investments, with 68% of agency budgets now allocated programmatically, compared to 40% among advertisers. Similar patterns are observed in mobile and video advertising, with agencies leading in programmatic adoption across these formats, emphasising programmatic's role in meeting the needs of today's media landscape.
In 2024, the hybrid model remains the most prevalent operational approach for programmatic advertising, combining in-house expertise with external resources. However, the in-housing trend continues to grow, with 25% of advertisers now citing in-house operations as their primary model. Advertisers favour in-house operations for cost efficiency and enhanced control, but the full in-housing model faces challenges such as media quality concerns and resource limitations. Interestingly, 42% of advertisers plan to bring more programmatic trading in-house within the coming year.
Drivers & Barriers
The focus for advertisers has shifted toward audience discovery, now cited as the top reason for investing in programmatic. This represents a move away from the operational efficiency focus of previous years. Agencies, however, still prioritise cost efficiency, while publishers see operational efficiency and scalable inventory as key drivers. Although sustainability remains a strategic priority for many, it ranks lower as a direct driver of programmatic investment.
Media quality has emerged as the primary barrier to programmatic adoption in 2024, with 31% of advertisers and agencies identifying brand safety, fraud, and transparency concerns as significant obstacles. This underscores the need for industry-wide standards to create a brand-safe and reliable environment for advertisers. Other notable barriers include economic and political uncertainties and, for some stakeholders, sustainability concerns.
Measurement and Data
Traditional metrics such as CPM (cost per thousand impressions) and CPV (cost per view) remain vital tools for evaluating programmatic performance, particularly for agencies. However, there is a notable shift towards quality metrics like viewability, which ensures that ads are actually seen by users, and brand safety, which guards against ads appearing in potentially harmful or inappropriate contexts. Despite the emphasis on measurement, the report reveals an increase in advertisers and agencies that currently do not measure campaign success.
This trend may be attributed to challenges around data accessibility, insufficient measurement tools, and a skills gap, as some stakeholders lack the resources to fully assess campaign impact. Alongside these shifts, first-party data is gaining a more prominent role as the industry prepares for a post-cookie future, with advertisers increasingly leveraging data directly collected from users. Contextual targeting—where ads are placed based on the surrounding content rather than user behavior—is also gaining traction as an effective, privacy-conscious alternative to third-party data.
Future of Programmatic
As the phase-out of third-party cookies continues, the industry is accelerating efforts to develop robust first-party data solutions. First-party data is crucial not only for advertisers but also for publishers, who are investing in technologies and strategies to better understand and connect with their audiences. Artificial intelligence (AI) is set to be a key driver in this new landscape, especially for advertisers aiming to optimise audience discovery and improve ad targeting accuracy.
AI-powered solutions are helping brands refine their targeting and automate complex processes, making programmatic more efficient and effective. For publishers, audio and retail media are emerging as promising growth areas, with investments in audio advertising expanding as audio consumption rises, and retail media providing a direct pathway to audiences in shopping contexts. Connected TV (CTV) is regarded as a major growth area across all stakeholder groups, driven by the continued shift to streaming and the opportunity it presents for targeted, high-impact programmatic advertising.
Sustainability
Sustainable practices in programmatic advertising remain a high priority, with over 80% of respondents indicating that sustainability is a strategic focus within their organisations. While there has been a slight decrease in enthusiasm among advertisers, agencies have notably increased their commitment, with 81% now prioritising sustainability in their operations. The path to achieving Net Zero is, however, uneven across the industry. Nearly 70% of agencies report making significant progress toward reducing their environmental impact, whereas only 20% of advertisers report similar advancements.
Ad tech vendors and agencies are driving the sustainability agenda forward, with many companies incorporating sustainability measures into their media plans and promoting the use of environmentally responsible practices. Nonetheless, opinions vary across stakeholders, with some debating the extent to which sustainability measures should be integrated into programmatic strategies. As standards evolve and the industry matures, sustainability is expected to become an increasingly standard consideration in programmatic media planning.
Source: IAB EUROPE: Attitudes to Programmatic Advertising 2024-report. You can find the full report here.