Programmatic advertising is the use of computer technology to automate ad buying and selling. It allows marketers to use data to target specific consumers at the right time, on the right device, with the right message to achieve their goals.
Programmatic ads can appear on any type of platform, from social media to TV and even in print. In 2020 alone, US marketers spent over $129 billion on programmatic ad buys. That figure is expected to exceed $150 billion by 2021. The growth of the industry is being driven by a number of factors including the evolution of Artificial Intelligence (AI) and the ability to scale advertising across platforms with ease.
The process of purchasing digital ad space via programmatic advertising occurs in milliseconds. First, a publisher puts up an open ad space on their website. Next, ad exchanges take in bids from advertisers who want to show their ad on the site. The publisher then displays the highest bidder’s ad on their page. Finally, the consumer sees the ad, and if they click on it, the advertiser gets a conversion.
Ultimately, this all happens in a matter of milliseconds thanks to sophisticated software that powers the process. The four main types of software are demand-side platforms, supply-side platforms, ad exchanges, and data management platforms. Each has its own job but they all work together to make the programmatic ad buying and selling happen.
A key aspect to the success of programmatic ads is knowing your audience well. By leveraging data and AI, marketers can create optimized campaigns that deeply resonate with their target audience. One example of this is Nike’s ad that used fitness activity and personal details to connect with its audience.
Another popular programmatic ad type is retargeting. Retargeting is when you follow a person who has visited your website or shopped on your online store. When that person visits other websites or interacts with other content, a cookie is placed on their device. This information can then be used to retarget the person with an ad that is more likely to convert them into a customer.
As the popularity of programmatic ads continues to rise, it opens up opportunities for smaller brands to take control of their own advertising spending. This is made possible by self-service programmatic ad platforms that allow marketers to buy directly from publishers without having to go through a traditional media agency. By taking control of their own ad buying, these brands can enjoy a more streamlined workflow and reduce costs.
Having a clear understanding of the terminology and process is important when starting out with programmatic advertising. There are a lot of new words to learn, so it is important that marketers take their time to educate themselves. This will help them to avoid miscommunication with their agencies and ensure that they are getting the most out of the technology.
Educating yourself on the process is also crucial for avoiding any problems that may arise. There are a number of issues that marketers need to be aware of, such as bots and fraud. These threats should not deter marketers from using programmatic ads but should motivate them to ensure their DSP has the right safety features in place to protect their brand. programmatic advertising