People are watching their favourite shows on Smart TVs, visiting places, commuting to the office, reading news, playing games, scrolling through their social media and the list goes on. Therefore, it is natural that the need to advertise on different channels and use different platforms to choose the best place to advertise in the digital world is becoming an increasingly difficult task.
Programmatic helps bridge the gap – marketers are now able to reach out to their target audience throughout the day across channels and ad formats wherever they go and whenever they do anything other than social media browsing.
Programmatic Advertising
In 2020, Programmatic Advertising accounted for 38% of the total advertising spend in India.
By the end of 2022, 88% of all digital display marketing in the United States is expected to be spent on programmatic advertising.
Overall, the forecast is that the industry will increasingly shift to programmatic media purchases over the next few years, with a market share approaching 42% by 2022.
The Southeast Asian advertising market is expected to register a CAGR of 15.29% during the forecast period 2021-2026.
The Southeast Asian digital advertising market will grow strongly by $417.4 million in 2022. That’s modest compared to last year’s $555.7 million surges, but it’s sufficient to spend more than $4 billion this year.
Programmatic Advertising is the use of automated media purchasing technology (the process of purchasing ad space), as opposed to traditional (often manual) digital advertising methods. Programmatic media purchases use data insights and algorithms to deliver ads to the right users at the right time and price. In short, programmatic advertising is a way to automatically buy and optimize your digital campaigns, rather than buying them directly from your publisher. This is achieved by the use of Artificial Intelligence & Machine Learning.
The exponential growth of Programmatic Advertising is not surprising considering the benefits it offers to marketers. Uninterrupted access to all ad formats globally on any website tops the list of benefits, followed by cheaper inventory, targeting options and ease of purchasing inventory.
Understanding Programmatic Advertising
These are the main things involved in the world of programmatic advertising:
- Sell-Side Platform (SSP): This enables publishers to automatically sell display and mobile ad inventory to potential buyers in real-time. This includes ad exchange, networking and DSP. This gives publishers better control over inventory and CPM.
- This is a platform that enables marketers to run different formats of ads against a targeted set of audience, device, geography, time, etc. The platform also enables them to manage the spend levels and control bids in the real-time advertising ecosystem.
- Ad Exchange: This is how the supplier feeds the inventory to Ad Exchange. The DSP connects to Ad Exchange, allowing advertisers, agencies, networks, and publishers to buy and sell ad space.
- Real-time Bidding (RTB): This is called an open auction and RTB is when the inventory price is set by a real-time auction. As the name implies, it is open to all advertisers or publishers. RTB is considered a way to buy media with a large audience at a low cost.
Benefits of Programmatic Advertising
There are several advantages to using a programmatic advertising platform for all digital advertising activities. Some are:
- Enhanced decision making: Programmatic advertising helps buyers and sellers make data-driven decisions and eliminates guesswork from the ad-buying process.
- Cost-effective: This is highly cost-effective since it uses machine learning to optimize campaign success, avoiding ineffective inventory.
- Better targeting: It will be difficult to find a technology platform that can target so many different tactics and devices in real-time. Here, programmatic advertising nullifies that problem and augments the company’s targeting factor.
- Uniform campaign management: By consolidating your campaigns across devices and formats into a single system, you can visualize your success in one place.
- Access to ad inventory: Advertisers can simultaneously access optimal inventory across multiple exchanges and force the algorithm to do the hard work of bidding.
- Add to your media mix: Programmatic advertisement can add real great value to your media mix, some of which are:
- All sized brands compatibility: The beauty of real-time targeted programmatic purchases means significantly less waste and greater cost-effectiveness. So if you don’t have a huge budget, or if you want to prove programmatic before investing further, rest assured that there is an approach.
- The reach: Programmatic access to the advertising space of millions of websites gives you the potential to find and engage your (almost) audience wherever you are.
- Cognizance: With strict measures to exclude sites and content that are considered insecure, brands can be confident that they have reached their intended audience in a fully acceptable brand-safe environment.
Enhancing Customer Engagement
Programmatic ads can be used to reach a specific audience, reach clear goals, and retarget missed conversions. Customer retention is important for building customer loyalty. The Zendesk Customer Experience Trends Report 2020 concluded the following:
- 74% of customers are completely loyal to a certain brand/ company.
- 52% of shoppers say they make every effort to shop from their favourite brand.
Programmatic advertising allows marketers to directly increase conversion rates for their ad campaigns, increase traffic, and be successful. With the flexibility and data-driven insights gained from programmatic advertising, brands can take marketing to the next level, improving reach, transparency, and reporting.
Debunking Myths
Myth-1: Programmatic Advertising mitigates creativity.
Reality: On average, the media is approximately 30% of the fulfilment of an emblem campaign; the alternative 70% is pushed with the aid of creativity.
Myth-2: Programmatic Advertisement’s motto is ‘display & video’.
Reality: If something is digital, whether it’s an in-taxi screen or a wearable, it will be available in the program in the future.
Myth-3: Programmatic Advertising is only for brand awareness.
Reality: Programmatic Advertising uses Machine Learning and offers abundant flexibility in optimizing toward performing pockets making it an effective channel for performance campaigns.
The Future of Programmatic Advertising
Programmatic advertising allows marketers to augment their effectiveness to send messages over their desired channels, optimising the Share of Attention, reaching the most desirable markets and demographics, and using the data to create new opportunities.
Through automation and machine learning, programmatic creates an environment where marketers can use digital media to achieve the best results and reach their most important audiences more efficiently than ever before.
The Need for Programmatic Advertising
Programmatic Advertising not only allows marketers to reach out to users across ad formats and devices but also impacts other organic and paid channels. Programmatic Ads increase awareness which leads to more brand searches and social media engagement, in turn increasing better results in search and social efforts.
Users are not loyal to any channel and hence marketers cannot afford to lose out on any touchpoint throughout the funnel. Hence adding Programmatic to the mix is no longer a choice, but the need of the hour.
Written by Arun Prabhu, Director of Business Solutions at Datawrkz
