Programmatic advertising
To begin, let’s define programmatic advertising as the use of software and data, selected and managed by people, to rapidly make decisions regarding the buying and selling of media.
Programmatic advertising has existed since the inception of Google’s Adwords and Display ad networks during the mid-2000s.
Fundamentally, the foundation for programmatic advertising is rooted in Google’s concept of capitalizing on their “ad slots” through a CPC-based auction where advertisers compete on keywords on the SERP (search engine results page). This methodical strategy embodies all the essential components of programmatic advertising as we know it today.
- A self-serve platform to let marketers manage their own campaigns – A campaign setup that is controlled by the client with no spending commitment.
- A real-time auction-based approach – A bidding strategy that is defined by the client.
- Targeting based on keywords – A targeting strategy that is defined by the client.
Although commonly perceived as programmatic advertising, search and paid social channels remain distinct and separate from it.
The difference between programmatic and traditional advertising
In what way does programmatic advertising differ from old-fashioned media buying, given that they use identical advertisements and publishers? The answer is that programmatic advertising is an advancement from traditional media buying, which necessitates manual input/output operations, reconciliations, emails and phone calls.
Programmatic advertising involves a centralized purchasing process that is automated and constantly optimized for optimal results.
Thanks to programmatic, marketers can now save a significant amount of time and execute marketing activities much faster than before. Media buyers and sellers have experienced many changes due to programmatic.
Buyers were fascinated by Dynamic CPMs, which resulted from DSPs’ bidding strategy. Meanwhile, publishers required the creation of SSPs (Supply Side Platforms) to enable them to acquire and generate income from their inventory more efficiently.
Ultimately, by utilizing DMPs, a complex programmatic network was established to furnish insights into every advertisement impression, enabling advertisers to evaluate their worth and determine how much they are willing to allocate for individual impressions.
Programmatic ad platform
When first starting out, programmatic buying of media can be difficult to comprehend due to its complexity. The process necessitates a highly evolved infrastructure and a significant degree of automation, which can result in a steep learning curve.
As the industry is a dynamic field, new technologies arise frequently, and they can bring significant changes to the industry. The programmatic ecosystem comprises various companies, as highlighted in the Ad Tech Lumascape, providing a quick overview.
A Demand Side Platform, or DSP, is the advertising acronym of utmost significance. It is the platform whereby advertisers can establish, oversee, and enhance their campaigns.
A platform that merges audience purchasing and intelligent bidding to facilitate the mass automation of ad space buying is referred to as a DSP. Prior versions of DSPs, such as Google Ads or Facebook Ads/Business Manager, may have been encountered by you.
The differences between Google Ads and a DSP
It is possible that you have interacted with Google Ads, a type of media that can be bid on, similar to a DSP. Nevertheless, there are distinct disparities between Google Ads and Enterprise DSPs.
In general, DSPs are commonly utilized by agencies. Although a DSP demands more proficiency, it provides a higher level of influence and the potential to utilize data sources, expand across exchanges, and take advantage of an integrated stack.
Google Display Network (GDN) is a better fit for individuals who are new to advertising and have limited abilities to oversee campaigns. Google Ads offers less data and inventory management capabilities, and relies more heavily on automated processes.
The advertisements will exclusively appear on the Google Display Network. Despite using Google Ads, most of the decision-making and control is still in the hands of the system rather than the advertiser.
Marketing organizations make use of high-powered software called DSPs, which provide greater control over data (1st party/third party) and more inventory access.
Having more choices to direct your campaign towards optimal performance also means that the outcomes of your campaign are highly reliant on the decisions made by the specialist who is managing it.
The marketer in front of the screen can achieve optimal performance by making intelligent choices.
The benefits of programmatic advertising for agencies
Programmatic advertising technology enables advertisers to create highly sophisticated and personalized marketing strategies (we recommend enlisting the services of an expert in programmatic advertising to ensure optimal customization to your requirements). The advantages of programmatic advertising are outlined below:
In programmatic advertising, it is possible to implement frequency capping for various devices, publishers, and channels.
Programmatic campaigns offer immense inventory access due to their connection with numerous SSPs that manage thousands of publishers and billions of ad impressions.
When using Google Ads, your options are restricted to publishers that are affiliated with Google. Consider reputable and widely recognized publishers such as Microsoft or Yahoo.
Each DSP is equipped with an array of algorithms catering to various KPIs, utilizing machine learning to optimize bidding strategies for optimal results.
With DMPs (Data Management Platform), you can choose from numerous audiences and purchase them instead of placements. The key is to ensure that your ad reaches the appropriate target audience, regardless of its location.
You can obtain audiences from well-known publishers such as Forbes. In addition, targeting of your campaigns can be accomplished by utilizing location history data of users from companies like Foursquare.
There are several targeting options available, including 1P, 3P, category, contextual, and keyword targeting, among others. Additionally, it is possible to purchase advertising space from individual publishers.
Simplified billings: The DSP handles all payments, and you only have to settle one invoice from them. The DSP takes care of the rest, so you don’t have to deal with paying individual publishers separately.
Efficient trafficking: Similarly to ad tags, there is no need to generate an ad tag for every publisher. Simply upload the ads to the DSP and they will be disseminated to all publishers.
Utilize your website visitors and converters’ first party data to generate audience segments resembling them.
Insights and lessons: Each of your DSP campaigns will provide you with numerous insights and lessons that you can utilize in your future campaigns.
Setting up new campaigns can be quick and simple by utilizing templates or duplicating existing campaigns, resulting in time-saving benefits for each subsequent campaign.
Your first-party data can be gathered and utilized within a DSP platform, allowing you to add it to the inventory of all publishers. This merges your data with their inventory.
One can sequence creatives and incorporate storytelling. As an instance, displaying a follow-up ad to individuals who have watched your video is a feasible approach.
In programmatic advertising, setting up a sequence for different videos to be watched in an ideal order is easily achievable, as another scenario may require.
Integrations make it possible to skip the step of uploading ad tags into the DSP if your ad tech stack is synced, as you can simply create the ad tags in the Adserver.
If your website analytics are connected to your DSP, you will receive more advanced metrics and audiences to work with, allowing for greater analysis and optimization.
This implies that you can focus on achieving actual business results instead of using proxy measures that may or may not be linked to your business success.
The principle of recency can also be applied to targeting. One possible example is targeting individuals who have visited your website or added items to their cart recently, but have not completed the checkout process within the past 24 hours.
With the use of a single platform, you no longer have to manually merge reports from various publishers. The DSP provides all the necessary information, resulting in a unified, deduplicated report that can be accessed with a single click.
How and why is programmatic advertising successful
It is indeed successful because of its efficiency, focus, and ability to be expanded.
US marketers spent more than $61 billion on programmatic ads just two years ago. It is predicted that by 2023, this amount will increase to $133 billion, accounting for 91% of the total expenditure on digital advertisements.
eMarketer reports that this growth has far exceeded previous projections, primarily due to the swift resurgence of the sector after the pandemic and advancements in Artificial Intelligence that are transforming marketing practices.
The reason the system is used is because it saves both time and resources.
John Lincoln, the CEO and founder of Ignite Visibility, elaborated on why programmatic advertising has become the latest buzzword in the digital marketing industry.
The aim of programmatic advertising is to eliminate the outdated and unreliable approach of campaign design that was notorious for being exorbitant for marketers.
Programmatic advertising enables you to trust an algorithm to identify the most efficient utilization of your advertising budget.
Your programmatic solution can take care of the challenging aspects of your campaign by simply providing it with information about audience, key performance indicators, and campaign details.
According to Lincoln, the system is equipped to both launch your campaign and keep an eye on your advertising expenses to identify opportunities for enhancement.
Programmatic advertising presents the opportunity for you to excel by aiding in the optimization of ad spend, increase in your organization’s ROI, and the ability to connect with your desired audience.
How can you succeed with programmatic advertising
After highlighting the advantages of programmatic advertising, it’s time to delve into how you can utilize it for your benefit in your digital marketing endeavors.
Familiarize yourself with your industry and target audience.
As a marketer exploring a new advertising field, it is important to conduct research to understand the concept better. There will be multiple unfamiliar terminologies and concepts, hence devoting time to comprehend them is crucial.
Explore this all-inclusive inventory of programmatic advertising terminology to gain insight and differentiate between your SSP and DSP.
Establish your objectives for programmatic advertising.
It is crucial to establish your objectives at the outset when it comes to digital marketing. To achieve this, analyze current data to ascertain the type of advertising awareness required and devise a potent plan to recognize immediate and future goals.
Always remember to consider the personal aspect.
Although programmatic advertising utilizes algorithms and machines, it is not completely lacking in human involvement.
Various platform types exist. Certain ones come with completely or partially managed services, such as War Room, whereas others offer technical platforms like Digilant, enabling you to operate your programmatic buying activities.
Afterward, you should assign proficient marketers to strategize, oversee, and improve your purchasing.
In order to attain maximum success, it is crucial to strike a balance between automation and intelligent human intervention. Therefore, it is unwise to depend solely on the algorithm to produce the most desirable outcomes for your campaign.
Ensure your brand is safeguarded against misleading information.
It was mentioned that programmatic advertising faces the challenge of displaying ads in unsuitable places due to its dependence on algorithms, which could result in the ads being placed on sites that promote fake news, for example, those related to coronavirus conspiracy theories.
To prevent this issue, make sure that you regularly update and monitor your blacklist of demand-side platforms to exclude any inappropriate websites. Certain platforms provide the option to eliminate entire categories from advertising expenses, which can be very advantageous.
If your product is sensitive, using a whitelist is a significant alternative. It permits only authorized sites instead of denying them.
By using this approach, you may limit your capacity to connect with your target market and increase costs, but you can be certain that your advertisement won’t be linked to any explicit or offensive content.
Make sure that the agency you use takes every possible step to prevent your ads from being displayed on low-quality and sensitive websites.
Be vigilant about programmatic ad fraud.
On average, programmatic ads have a viewability rate of 44% to 55%, but digital advertisers are projected by eMarketer to lose between $6.5 billion and $19 billion annually due to fraud. Advertisers are also facing concerns regarding consumer privacy, particularly on mobile and Connected TV (CTV) platforms.
What measures can your business take to combat fraud? Initial step is to examine the ratio of budget to reach. Programmatic advertising has been predominantly centered on reach, which makes campaigns more vulnerable to bot exploitation.
If an opportunity appears to be too good to be true while placing bids for advertising space, it is likely not genuine! Instead of solely focusing on the number of views, consider combining it with the caliber of traffic to prevent the creation of false traffic.
To avoid being one of those brands, it’s important for your organization to ensure that ads comply with privacy regulations. Pixalate reports that 22% of Apple App Stores and 9% of Google’s have apps without a privacy policy, which can result in “dangerous permissions.”
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