The global display advertising market alone, in fact, is expected to reach $80.25 billion by 2021 - growing at an incredible compound annual growth rate (CAGR) of more than 18 percent - according to 2016 report from Technavio. If you're serious about promoting a brand on the Web, programmatic advertising (whether for the search or display channel) is a frequent point of discussion among enterprises as the opportunity is simply immense and too difficult to ignore.
What this all ultimately means is that if you're not taking steps toward actively participating in the programmatic landscape right now, it's time to get started.
OpenX suggests that factors including improved verification tools, experience and education are likely driving the increase in confidence. While programmatic advertising in the past has often been used to reach target audiences as cheaply as possible with little regard for the quality of the sites in which the ads appeared, it is now being used in conjunction with very robust data segments (more on that later) to target individuals in increasingly intelligent and creative ways, identifying those who are most likely to be receptive to advertisers' messages. What that ultimately means is that it's time to consider where your brand is investing its advertising dollars.
Many 'Net professionals, however, still aren't using programmatic and they are in some instances rightfully cautious about moving around budget. That might be due in great part to the complexity of the opportunity, so let's take a few digital steps back and start from the beginning in order to get a handle on what programmatic really means.
There are also data management platforms (DMPs), solutions that help advertisers collect and analyze user behavior and cookie data so that audience segments can be established and targeted based on the advertiser's strategy or campaign goals. The process of buying and selling happens in milliseconds. Essentially, an auction happens every time a page loads, with the highest bid winning the right to show inventory in that location. That's called "real-time bidding" (RTB) and for many it's the core of programmatic and digital advertising in general. Despite RTB's popularity, there are many ways to execute a buy in programmatic, including the following.
A collection of open ad exchanges, each of which provides ad inventory to the advertiser via a demand side platform (DSP) such as DoubleClick Bid Manager, Mediamath or The Trade Desk. Advertisers tend to bid on this inventory on a cost-per-thousand (CPM) basis and will often have bid-level control.
Auctions that tend to contain unsold inventory that a publisher sets aside for select advertisers. To enter these auctions, advertisers must bid a minimum floor price (set by the publisher). Typically, the content is for premium, higher traffic areas of the site or app.
Programmatic technology essentially allows advertisers to take everything they know about their existing and potential customers (user data) and deliver a unique experience at each stage in the consumer journey.
Advertisers recognize the opportunity in programmatic, are loaded up with data for these campaigns and are flush with budget to spend. What they will ultimately find when embarking on an effort of this nature is one of the most streamlined and useful software ecosystems ever developed.
Developers using the self-service platform will also be able to block certain types of ads in order to protect audiences, and publishers can view all demand partners filling their inventory, with details on specific buyers and brands. That level of transparency is unique in digital advertising.