You may or not have come across this term, but if you are already a digital media marketer or enthusiast, programmatic marketing should/sooner be starring you in the face; and if you own a business/brand, and you are looking to find a more tailored approach to reach your target audience, then you’ve just found one.
Programmatic marketing is automated bidding on advertising inventory in real time, and involves millisecond long auctions during page loading times (via algorithms) for the opportunity to show an ad to specific customers in specific contexts.
Programmatic marketing opens up a series of opportunities, which would not be possible if ad placement was done manually (as it has been done in the past); allowing advertisers to procure digital media without having to pre-negotiate a price, so they pay only for the relevant impression that they actually receive.
They can also sign up for a minimum number of impressions or a minimum budget, which makes digital advertising more flexible, and they can buy digital media across publishers, with reduced administration costs.
Why is it essential?
It is a major component of modern advertising. In 2019, it was predicted that 65% of all money spent on advertising in digital media would be traded programmatically and that advertisers would spend an astonishing US$84bn on the format worldwide.
Programmatic advertising is now the dominant form of buying and optimizing digital advertising and understanding the basics is crucial for survival and dominance in this ever competitive market environment.
Got it? Here are additional 5 good reasons why you should already be making your digital advertising programmatic:
- Programmatic advertising helps you spend your advertising budget wisely; allowing you to target users on a granular level. With access to incredible amounts of data at your fingertips (GDPR compliant of course), you can target viewers with the right message, in the right place, at the right time. This means you’re using your ad budget smarter, eliminating waste on viewers who are unlikely to be interested in your product.
- With programmatic advertising, the performance of each ad is measured in real-time.
Now, advertisers need not wait for an excel sheet from their media agency weeks after the ads go live.
Programmatic allows advertisers to adjust and optimize ads there and then to test and improve results as well as have clear oversight on their ad spend.
- It offers brands a transparent way of buying media. Now, brands can have full transparency over fees and exactly where and how much of their money is being spent on what.
- It’s no longer ‘all about data’. With programmatic advertising, users can be targeted based on keywords and contextual relevance of a page; providing a seamless and less intrusive way of reaching your desired audience.
- Programmatic offers you a higher dimension of Multi-channel and format reach; it allows you to reach audiences across devices: on mobile, desktop, tablet, in-app, via TV and even out-of-home. With the increasing number of digital touchpoints of your average user, your advertising should keep up. This is where programmatic advertising is leading the edge; the possibilities are endless!
How exactly does it work? Here is:
Recall we said earlier that it is an automated bidding on advertising inventory in real time, and involves millisecond long auctions during page loading times (via algorithms) for the opportunity to show an ad to specific customers in specific contexts.
Now, here is a step-by-step guide to the most common format of programmatic, from beginning to end, to help you understand the process:
First; when a viewer lands on a website that uses programmatic advertising, it starts the automated bidding to serve an ad to this particular viewer.
Second; the publisher lists the ad space for this viewer on their supply-side platform (SSP). The SSP acts as the seller for the publisher, letting advertisers know the characteristics of the site, user, and ad space that allows demand-side-platforms (DSPs) to make their bid. Essentially, they advertise the product (the ad space) for sale.
Third; once the SSP receives the information on the ad space, they analyze the user’s cookies to determine factors such as their geography, demographics, interests etc.
Next, the corresponding DSP reviews the information on the user, provided by the SSP. DSPs act for advertisers to choose ad space that aligns with the advertisers’ budget and targeting parameters. It assigns the ad placement a value based on the website and user’s characteristics.
Then; on behalf of the advertiser, the DSP makes a bid on the ad placement (remember, all this happens in real-time, which is why programmatic advertising can often be referred to as real-time bidding (RTB)).
Sixth; once the SSP receives the bids from various DSPs, the SSP will then pick the winner. There are different bid strategies out there for different SSPs. Waterfall bidding, Client-side, and Header bidding (with header bidding widely considered the most efficient and fair).
Finally; the winning bid is picked, and the SSP displays that ad to the user on the publisher’s site. This entire process happens in milliseconds (all while the page is loading for the user).
As John Lincoln, CEO and founder of SEO Company, Ignite Visibility wrote on Inc:
“Programmatic advertising is designed to do away with old-fashioned, hit-or-miss campaign design. That system was notorious for costing marketers way too much money.”
Now, you can rely on an algorithm that will determine where your ad money is best spent. All you have to do is feed your programmatic solution some info about your campaign as well as key performance indicators and you’re all set.
“The system will not only launch your campaign, but it will also monitor your ad spend to look for areas of improvement.”
Hope you enjoyed this piece? Let us know what you feel at the comment section, or better still, reach out to us for more dynamic strategies/approach for the most programmatic solution/experience for your brand/business.
Super Stars Promotions Ltd. is a leading brand in programmatic marketing/advertising.
Glad to help.