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Programmatic Advertising | A Beginner’s Guide

You’ve probably heard of programmatic advertising before, but just like most big words, we tend to ignore them if we don’t know what they mean. I’ve been there, don’t worry. We’re here to scare off that big-word-syndrome and tell you all you need to know to get started.

WHAT IS PROGRAMMATIC ADVERTISING?

Programmatic advertising consists of data driven, automated ad buys, that decide on what ads to buy and how much. Programmatic ads can be anything from online videos, banner ads, streaming, mobile ads, and so many more. Basically, what it boils down to is using data and technology to get the most bang for your buck. Before you even think about considering programmatic as a tactic, you need to have, and know, a couple things before you start.

WHY SHOULD YOU CONSIDER USING IT?

Programmatic is one the most targeted types of advertising you can buy; it’s all about reaching who you want. You can target all kinds of audience types by age, gender, location, current events, milestones – and that’s just the basics. Programmatic can open new worlds for you because you can also target an audience by things like their purchasing or viewing habits, if they’re easily influenced, if they travel a lot, what types of foods they like, and many, many more levels of sophistication, depending on your needs.

By being able to get very granular with your audience, programmatic also ensures better results and improved efficiency, both with your reach and with your spending. On average brands see a 200% improvement in actions rates and up to a 70% reduction in CPC and CPV.

HOW DOES IT WORK?

There are a number of steps we take when creating and implementing programmatic advertising strategies.

  1. Selecting a Demand Side Platform

    DSP for short. This is where the ads are ultimately purchased. We apply targeting capabilities, get real-time progress reports, manage budgeting and many other services depending on the server you decide to partner with. This is in contrast to doing it the old fashioned way–individually reaching out to ad sellers. We take the time to evaluate individual client needs before selecting a DSP for an account, as opposed to working with only one agency partner.

  2. Choose an Ad Exchange

    This is a digital marketplace where we’ll be able to actually buy ad space on select websites, streaming services or whatever medium we decide to use. The ad exchange will take what we entered in the DSP and generate how many impressions will be obtained. It’ll then ask us if we’re interested in buying the space and a price will be chosen with real-time bidding. We can set parameters for your prices and impressions so it can buy when we’re away.

  3. Pick a Data Management Platform

    We can call it DMP. This is crucial in collecting data because well…this is a data management platform. Everyone your ad reaches will be detected by this service, which will then all be complied and analyzed to better help us learn about your audience. This will ensure that we are reaching out to the right audience, as well as show us who future audiences might be.

SOME THINGS TO BE CAUTIOUS OF

  1. Availability of programmatic media options

    Premium placement spots are not always up for bid on DSPs. There are still quite a few publishers out there whose main goal is to sell their spaces through traditional methods, meaning the only spots open for programmatic are the leftovers.

  2. The advertising medium

    Monumetric claims that video ads sold programmatically perform far worse than direct- video ads. Programmatic video ads had a 35.5% viewability rate in 2016, compared to publisher direct ads which had a 59.3% viewability rate. This goes to show how much of a role the format of your ads play when considering how you place them.

  3. The “internet-stalker” factor

    Some users just don’t like these kinds of ads. They aren’t comfortable with how much a brand can know about them, which could affect the trust of potential customers.

So now that you understand the basics, you can better understand how programmatic advertising might fit into your mix, and the steps a media partner takes to implement it.

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