"Data-Driven Thinking" is written by members of the media community and contains fresh ideas on the digital revolution in media.

Today’s column is written by Tim Mahlman, president of ad platforms at Oath. 

With spend growing by more than 72% over the past three years, programmatic is the backbone of online advertising. For advertisers, automated buys allow smarter and more efficient data-driven transactions at scale. However, even with these considerable benefits, some advertisers struggle with growing brand-safety and transparency challenges across the programmatic ecosystem.

The data bears this out. Though spend is up, programmatic buyers have fallen 12% year over year, according to a new study by MediaRadar. These advertiser concerns stem from very public quality-control challenges for platforms like YouTube and Facebook.

Advertisers are worried their ads will show up next to offensive content and some are redirecting or cutting spend as a result. But the reality is that programmatic is evolving to solve for brand safety.

Existing Tools And Greater Collaboration

Many technologies that can safeguard brand safety for advertisers already exist and are built into programmatic platforms.

For example, at the most basic level, vendors have traditionally adopted blacklists that outline bad actor sites where ads shouldn’t be served. On the other side, there are whitelists that limit impressions to a specific group of brand-safe sites and inventory. There are also pre-bid filter systems and third-party providers, such as Integral Ad Science, that can ensure brand-safe environments during bid requests. The challenge, however, is that these tools are not always fully used by vendors and advertisers.

Some vendors have shied away from using them because they potentially cap campaign reach for buyers. But as brand safety becomes a central topic for customers, these capabilities are now in vogue again.

Underused quality-control measures can also stem from a lack of communication between buyers and vendors. Now, with the issue in the spotlight, we’re seeing buyers and platforms working together to ensure preferences and acceptable filters are in place at a campaign’s outset. This shift in behavior will have a significant long-term impact.

Artificial Intelligence And Machine Learning

Some forget that programmatic is still a relatively new form of media transacting. While last year almost one-third of US marketers invested 50% or more of their digital budgets programmatically, that number was just 7% in 2013. And, as is the case with any new technology, there are bound to be growing pains along the way – especially when growth is so explosive.

Make no mistake: Brand safety is a very real concern. But it’s an early challenge that is being addressed through sophisticated technology from the category’s biggest vendors.

For example, many platforms have ramped up investments and implementation of artificial intelligence capabilities and machine learning to ensure greater brand safety. AI is an opportunity to weed out offensive content at scale, providing a smart tool that can prevent today’s threats while evolving quickly to predict and prevent the threats of tomorrow. As AI is paired with more traditional quality-control methods for ensuring brand-safe placements, including whitelists and blacklists, the technology will safeguard brand perception, cultivating greater confidence between buyers and sellers.

Programmatic Direct And Premium Marketplaces

Even with the MediaRadar data considered, the prospects for programmatic adoption are bright, with $4 of every $5 spent in digital display projected to be transacted programmatically this year. While advertisers are cautious about brand safety, they’re also mindful of the unique value of programmatic. As a result, we’re seeing programmatic marketplaces – not just the technology – evolve to unify the benefits of automation with increased quality control. Programmatic direct is the best example.

While the share of programmatic deals made across open exchanges is declining, the share bought through programmatic direct is growing – rapidly. Programmatic direct will capture 56% of total programmatic display spend this year versus 44% in open exchanges. Buyers are investing in programmatic direct because the inventory is generally premium and considered brand-safe. So, while programmatic will continue to see investments from advertisers, the type of programmatic transactions are likely to change.

At the end of the day, advertisers want brand safety in programmatic. And the ecosystem needs to deliver, and it’s evolving quickly to build greater trust with buyers, expand transparency and ensure brand-safe impressions through better tools and methods.