Despite the numerous benefits (more precise targeting, greater reach and scale, cost efficiencies, real-time optimization and data enrichment to name but a few) there is still some confusion surrounding programmatic advertising, even as these type of media buys are seemingly dominating the digital market.
Today, 4 out of every 5 display ad dollars currently transact through programmatic means according to eMarketer and nearly 80 percent of advertisers have made a programmatic buy in the past year (compared to just 35 percent in 2014) according to an ANA/Forrester programmatic survey from March 2016.
Those engaged in the practice might think that the market is saturated, but they would be wrong as complexity surrounding the strategy has kept many enterprises out of this ad market entirely. With a little guidance on programmatic, however, these businesses could benefit greatly from participation.
Programmatic advertising is simply the buying of ad space in an automated manner, using audience data and behavioral insights from a variety of sources to enable advertisers to show ads relevant to the audience at the right time, place and context. In the realm of programmatic, everything (and we mean everything) is enhanced with data.
The Main Players in Programmatic
Those just getting started with this type of advertising would be wise to first understand the various entities that fill the space - and there are many. There are demand-side platforms (DSP) that allow buyers to manage multiple ad exchanges and data exchange accounts in one place, data management platforms that integrate third-party data and supply side providers (SSP) that enable publishers to manage their available advertising inventory.
There are several different ways that advertisers can buy programmatic advertising (on open exchanges, private marketplaces and programmatic direct) tactics that can be employed based on the needs of the business. Advertisers, for example, can take an algorithmic approach, deploying lookalikes and data modeling in order to serve ads to prospects that fit their targeting criteria. Retargeting, possible thanks to tracking technologies like cookies, is another tactic where ads are served back to exposed target until the desired action is taken. Advertisers can also use an action-based model where ads are served based on a specific activity such as search, emails, social or app engagement. Ideally, all of these tactics would be employed by advertisers.
Advertisers can engage in programmatic across every channel including TV and video (with support from solutions including Adap.tv and TubeMogul), radio and audio (targetspot), mobile (Amobee and TapAd), native content (TripleLift and Nativo) and, of course, social media.
Trends in Programmatic
There are some very exciting trends emerging that stand to further accelerate the trend toward programmatic media buying. Dynamic ad creative, for example, can enable advertisers to change their creative advertising assets (e.g., display banners) based on information received in real-time about the user, their behavior or their location. Header bidding, which provides publishers the ability to collect multiple bids from a variety of demand sources each time a new impression is available (
learn more about the benefits and drawbacks at wsm.co/bidbacks) is also an important trend for advertisers to stay on top of. Artificial intelligence, however, stands to truly revolutionize what is already a highly sophisticated approach to advertising. In the near future, advertisers will be able to use prediction management platforms to forecast how each campaign should be optimized in order to achieve the optimal results well before bids are even made.
Programmatic is not without its faults, of course, and they weigh heavily on the minds of digital advertisers. Viewability, transparency and fraud are serious concerns that are only slowly being addressed by the industry at large.
PROGRAMMATIC IN DECLINE? Ad intelligence platform MediaRadar recently released its Consumer Advertising report, which revealed that programmatic ad buying declined 12 percent in Q1 2017 versus the same time last year (Q1 2016).
Learn more at wsm.co/buydecline.
Digital marketing executive with proven experience in all aspects of search engine optimization (SEO), performance-based advertising, consumer-generated/social media, email marketing, lead generation, Web design, usability, and analytics. - 20-year Internet marketing veteran, currently serving as the Digital Marketing Campaign Manager at Antenna Group (formerly Chicago Digital). - Former Editor-In-Chief of Website Magazine, and a regular speaker on Web technology digital marketing strategy - Author of several books on digital marketing Including Web 360: The Fundamentals of Web Success; Affiliate 360: The Fundamentals of Performance Marketing; Domains 360: The Fundamentals of Buying & Selling Domain Names, and SEO 360: The Fundamentals of Search Engine Optimization.