Have you ever noticed how many advertisements you view in a day? We are exposed to hundreds of advertisements while browsing through the information on our mobile phone, laptop, or another device; these ads are meticulously designed to target a certain group of individuals, among them: you.
Ads differ from person to person, even though they are seeing the same information at the same time. So, how do brands target ads across thousands of websites and apps? This is called programmatic advertising.
Programmatic advertising connects publishers and brands in milliseconds before the website even loads. Users browse through tons of content on the internet for free every day, but to provide quality content, some websites, and apps, also known as publishers or content creators, need to generate revenue. To do so, they receive assistance from exchanges, also known as SSPs, which stands for supply-side platforms.
Brands seek to contact internet users to sell products and services; their goal is to send tailored adverts to their customers across the web, which they accomplish by acquiring advertising space. To accomplish this transaction, brands must employ DSPs (demand-side platforms).
DSPs are media platforms that advertisers and agencies utilize to launch digital campaigns.
To help you understand the process, this is the most popular programmatic format from start to finish:
- When a viewer searches for anything on the internet using a web browser and clicks on one of the results, dozens of new actions take place in the background that the user is unaware of while the website loads.
- The website that uses programmatic advertising has allocated space to deliver ads to users, and they must file a request to add exchanges to receive the best price.
- In turn, the ad exchange generates an ad request with information such as device class, URL, IP address, category, cookies, and more.
- Once packaged, the add request is sent to DSPs where the brands participate; while the DSP is receiving the request from the ad exchange, brands have already pre-determined their campaign creatives, targeting criteria, and bidding price in the platform; if there is a match, the DSP submits their bids to the ad exchange; the exchange validates all the bids by verifying publisher rules, scanning for malware, and finally choosing the winning bid.
- Once the winning bid is chosen, it is delivered directly to the publisher together with the other bids; the publisher then makes the final choice and selects a winning bid using its own advertising software. It's now time for the ad exchange to render the ad onto the page; at this point, the viewer may see both the publisher's content and the ad on the page and decide whether or not to interact with it.
In summary, the programmatic advertising ecosystem buys and sells digital inventory across hundreds of websites and apps using automated technologies. In fact, the entire procedure takes less than 400 milliseconds to complete. Advertisers use ad exchanges to conduct their campaigns, while publishers use them to monetise their inventory. Furthermore, the options for inventive formats are limitless. Bringing advertising campaigns to life with native display video and CTV. Users can receive curated content practically everywhere, whether they are on their phone, passing a digital advertisement on their way to work on their laptop, or watching TV at home.
5 reasons to make your startup advertising programmatic.
1. Make good use of your advertising budget.
You may target users on a granular level with programmatic display advertising. With unprecedented amounts of data at your fingertips (GDPR compliant), you can target viewers with the appropriate message, in the right place, at the right time. This implies you're making better use of your advertising budget by avoiding wasting money on people who are unlikely to be interested in your goods.
2. Measurement and optimization in real-time
The performance of each ad is measured in real-time using programmatic advertising. Advertisers no longer have to wait weeks for an excel file from their media agency, which is too late to optimize a live campaign.
Advertisers can alter and optimize advertising in real-time, test and enhance outcomes, and have complete control over their ad spend using programmatic.
3. It is a transparent method of purchasing media
Prior to programmatic advertising, brands were obliged to rely on agencies and third-party vendors to manage their ad expenditure. Brands can now have complete transparency regarding fees. Furthermore, where and how much of their money is spent on what.
4. Not excessive information.
Knowing everything about a person isn't required for programmatic advertising targeting. That's where contextual targeting comes in, offering a more seamless – and less intrusive – manner of reaching your target demographic. This allows you to target users based on keywords and a page's contextual significance.
5. Reach through multiple channels and formats
Your advertising should keep up with your ordinary user's rising number of digital touchpoints. This is where programmatic advertising is making a name for itself. It enables you to reach consumers across several platforms, including mobile, desktop, tablet, in-app, TV, and even out-of-home and many other options.
What are the different formats of programmatic advertising?
Television
Nowadays, programmatic television ad spending is not big. Yet, many large industry players, such as Google, SKY and Netflix, are building the infrastructure needed to support the move to programmatic TV. However, out of the programmatic formats mentioned, the format is in need of more development.
Display
The oldest format of programmatic advertising is displayed dynamically. Constant technological developments, mobile optimisation and better use of data have seen new opportunities emerge. With the rise of new technology, many marketers have embraced programmatic creative strategies that target viewers, with the right offer, at the right time.
Out-of-home digital advertising (DOOH)
With the adoption of digital signs, programmatic is spreading rapidly into the world of out-of-home advertising. The time-consuming production process of advertiser, agency, media seller, and printer is on its way out. Instead, integration across current programmatic platforms enables real-time DOOH ad tuning and adaptability.
Native and social
These are programmatic adverts that blend with the content either on a website, social network or other application. For example, it could be for sponsored content, so setting up contextual targeting as well as tailoring your ads is very important.
Furthermore, DSPs now allow advertisers to buy programmatically across the major social advertising networks, with social video being especially popular.
Video
Buying and serving digital video programmatically across channels is now a vital marketing strategy.
Voice
The development of Amazon’s Alexa and the proliferation of streaming apps have seen the emergence of another format: voice. This format offers a rich supply of both contextual and user-focused targeting. It is also rapidly maturing, with Google now allowing advertisers to purchase programmatic audio ads via its DSP.
The key factors you need to consider when choosing a DSP
1. First, think about who you want to reach out to. Which DSP has the biggest reach, segmentation, and channels that are relevant to your target market? Remember that in certain nations, SSPs are superior to others, so choose the DSP that best fits your marketplace. Also, keep an eye on who publishers your DSP associates within each target market.
2. How do you get charged by your DSP? Is it based on cost-per-thousand (CPM) or cost-per-click (CPC)? DSPs that charge by the CPM is typically more upfront about their cost margins.
3. What kind of support services does your DSP offer? You might prefer a DSP with an agency-style setup, where you can get help launching and optimizing campaigns.
4. Determine whether your DSP can implement an effective cross-channel strategy if you so wish.
5. Consider how a DSP can interface with the data management platform (DMP) or creative management platform (CMP) of your choice (CMP). Smaller DSPs are more likely to be flexible when it comes to integration.
6. Finally, With the correct plan and technology in place, your programmatic advertising campaigns will operate in the same way and best practices as any other digital marketing campaign. Remember, "you get what you pay for." Conduct research to identify the level of targeting, optimization, and control that you require. If you want quality, you must be willing to pay for it! (Expect hidden fees if the price is too low.) Experiment with alternative messaging and creatives, target different personalities and attempt new placements and bid strategies.
Busch. (2016). Programmatic Advertising The Successful Transformation to Automated, Data-Driven Marketing in Real-Time (1st ed. 2016.). Springer International Publishing. https://doi.org/10.1007/978-3-319-25023-6
Samuel, White, G. R. ., Thomas, R., & Jones, P. (2021). Programmatic advertising: An exegesis of consumer concerns. Computers in Human Behavior, 116. https://doi.org/10.1016/j.chb.2020.106657
Such an interesting article! I believe that programmatic marketing is likely to become even more important in the future, considering that third party cookies are being phased out and marketers are looking for alternative ways of targeting their audience through advertising. Programmatic Marketing also truly allows startups to have more control over who they target and what they spend - which is perfect when you are on a small budget. I definitely look forward to seeing how AI driven programmatic marketing will develop in the future.
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