Programmatic Display Advertising Explained

If you’ve been using online advertising for a while now, then you might have heard others raving about how programmatic display ads have changed the landscape.

Now, if you only foolishly nodded and smiled as people talk about it but not really understood it, then it is high time you can try to learn its basics here.

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Here is your simple guide to programmatic display advertising.


Programmatic Display Advertising Defined

It goes by other names such as programmatic buying or real-time bidding. In its simplest term, programmatic advertising is when you utilize intelligent software to buy digital advertisements, automatically.

Whereas the traditional methods include the requests for proposals, quotes, tenders, and human negotiation, programmatic display advertising uses algorithms and machines to purchase display space.

But, you need to understand that it is not the complete automation of the process of ad buying. Usually, you need to manually prepare insertion ad tags or order which can be labor-intensive. However, with programmatic ads, you will have more time for the improvement and optimization of ads.

You will always need to plan and optimize advertising, however, with programmatic advertising you will have fewer ad buyers.

Here’s what happens when running a programmatic advertising campaign:

  • Buy an ad space through an Ad Exchange
  • Enter the bid against your competitors
  • The ad will be served if youare the highest bidder

Programmatic Display Advertising: How It Works?

First, the publishers create an ad space on their site though SSP (Supply-Side Platform), then connecting it with an ad exchange. The advertisers will set their target audience, budget, cost and other details with their DSP (Demand-Side Platform) and connect with the ad exchange.

When a user visits the website, all data about the user is sent to the ad exchange. Now, if the user’s data matches the advertiser’s defined audience, the user will enter the auction for RTB (Real-Time Bidding). If it is a programmatic direct, then the ad will be served.

The advertiser with the highest bidding will win that ad space for programmatic RTB and the ad will be served. After that, the publisher will get paid for the ad.

programmatic display ads

And while this might not seem that different to a PPC network, everything here is done programmatically using AI, improving every step of the entire process. And although it might seem similar to the traditional online advertising, it does take out all the labor and manual work.

Who Uses Programmatic Ads?

Programmatic ads exist in a broad range of digital channels, including social, video, mobile and display. The traditional offline channels are also on their way to becoming digitized too.

We are starting to see out-of-home channels doing programmatic advertising via digital screen on shopping malls, bus stations, billboards and more. Previously, this kind of ad was only reserved for the larger media and budget agencies, however, the rapid rise of self-service tools offer the smaller brands increased access to the technology, offering them the capability to compete with larger brands without asking the expensive middlemen.

4 Reasons Why Your Brand Needs To Try Programmatic Advertising

If you have not tried programmatic display advertising yet, then here are several good reasons to convince you.

  1. Targeting

One of the best benefits of programmatic advertising is that you can laser-target your specific audience. A survey conducted by Google asked advertisers what was the best feature of programmatic advertising.

Seventy-six percent of the advertisers said that the targeting options were the best.

And while your campaign might not deliver amazing results, you can definitely get better results with programmatic ads that what you would with the traditional ads. Undoubtedly, programmatic advertising is the best, in terms of targeting.

  1. Multi-Channel

One of the main problems with traditional ad channels such as Bing and AdWords is that they have their own specific network of websites where your ads will be displayed.

For example, turning a display campaign on AdWords, these ads will only be shown on the partner websites of Google. And while other advertisers claim its fine, but what about other sites that are not part of Google’s network?

In addition, if you wish to run a video ad, even if your campaign is running the largest ad network in the world, you will only be able to reach YouTube. So, what if you want to reach other streaming sites?

Well, programmatic ad provides you access to a huge inventory of ad networks, ad exchanges, and publishers. You get to run ads in various formats, including the media-rich ads which are personalized and interactive.

The best part? You get to advertise on mobile, apps,tablets, in-videos, desktops, and pretty much everywhere you wish.

  1. High ROI

Programmatic display advertising uses AI or artificial intelligence. This is why it is called “programmatic”. But what does this even mean?

Well, it means that the program learns, improves and gets better with time as to when and where to run your ads for the maximum conversions and ROI.

what is programmatic advertisingBeing multi-channeled, highly targeted and uses AI to adapt, programmatic advertising gets a massive return on investment. And this is why marketers have invested more in digital than traditional, with digital now accounting for at least 54.2 percent of the market place.

In addition, there are a lot of amazing tools available out there to easily increase the ROI of your programmatic ad campaign. For instance, you can use Analytics, AdWords and even DoubleClick (Google’s very own programmatic ad platform) in order to set up the attribution model and see just how each programmatic advertising platform aligns with the journey of your customer.

  1. Improved Reporting

Since programmatic advertising is highly targeted and utilizes AI, you can get data-rich reports as well as actionable insights on your campaigns, target market, ads and buying patterns. These data should help you make smarter marketing decisions and grow your business efficiently.

In addition, since targeting with programmatic ads is quick and easy, you can literally serve unique ads to each person, allowing you to analyze your audience at an individual level, a thing that is impossible with other forms of online advertising. Combine these reports from your programmatic ad campaigns with big data and you will be unstoppable

In addition to the 4 main benefits of using programmatic display advertising, you can also enjoy other advantages like:

  • Real-time bid adjustments
  • Supports media buying from various networks
  • Completely automated buying platform

So, How Can You Do It?

Now you have better understanding of the basics of programmatic advertising, let us discuss how to actually create a programmatic display ad campaign.

  1. Understand Your Marketplace

The very first thing you need to do is to understand your marketplace. Get to terms with what you are doing. As an individual on a venture into a new area of advertising, you’ll be faced with a number of new terms and ideas, so you need to take the time to understand them.

  1. Setting Goals and Objectives

Like any digital marketing process, it is crucial that you have your goals set. You can use existing data in order to determine what kind of advertising awareness you will need and set a fitting strategy. This should allow you to define your long- and short-term goals.

Do not jump to programmatic advertising unless you know why exactly you’re doing it.

You should try programmatic ads if:

  • You need a competitive edge
  • You have spent enough time on PPC and other kinds of advertising and have taken huge data on your target audience
  • You can reach your market across all devices and channels
  • Your traditional ad campaigns do not give you access to your whole target market

Once you have a clear understanding why your business needs programmatic ads, next is to set objectivesand define what you want to achieve. You need to know what your primary goal is. Is traffic, engagement, ROI, lead generation, increase in sales or brand awareness?

  1. Choosing a DSP

When running a PPC campaign, you need to register for an ad network. Similarly with programmatic advertising, you will need to choose a DSP that gives you access to advertisers as well as ad placements, allowing you to set bids.

You need to choose a DSP as well as an agency to kick-start your fist programmatic ad campaign. You choose should be based on 2 factors:

  • The cost of your campaign
  • The quantity and quality of inventory available with your agency and DSP

Once you are done with the DSP selection, you can now initiate your campaign.

  1. Optimizing and Expanding

It is strongly suggested to run an RTB campaign since they usually have lower costs but still provide you with enough information to optimize your ad campaign.

To obtain the best results from your campaign, you need to optimize your ads, creative and other variables at all levels. Some of the variables that you should not neglect include:

  • Ad frequency
  • Bid adjustment
  • Ad format
  • Devices
  • Split testing
  • Channel
  • Placements
  • Audience segmentation

The next phase is to expand the ad size. Google claims that non-traditional ad units offer better viewing rates. Thus, you will need to expand your ads and ad spaces bidding with lower demand. This should help decrease your cost because of the low demand and allow you totry various sized and placements of ads that can lead to a boost in viewability rate.

  1. Pick Direction Publishers

Now, based on the testing and optimization, you will have a better idea of choosing your programmatic direct partners. You need to pick a site that performs well in terms of ROI, clicks, sales, conversions, and engagements.

When purchasing for direct programmatic ads, ensure that the publisher is someone that you would like your brand to be associated with since they will be your partners. Consider programmatic direct as long-term partnerships rather than just an exchange of ad.

  1. Tracking and Measuring

Tracking and measuring the progress of your ad campaigns should not be taken lightly. At least 84 percent of marketers believed that better analysis and measurement can help increase their digital spending by at least 25 percent more.

So, make sure to measure the performance of direct publishers as well as KPIs and primary metrics. Based on your analysis, you can tweak your bid, creative and other variables as well as replacing direct publishers who do not do well.

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Lorenzo Gutierrez
Digital Marketing Strategist at Lorenzo Gutierrez Digital Marketing
A little bit about myself: Lorenzo Gutierrez, founder of Lorenzo Gutierrez Digital Marketing, has a decade of experience growing business revenues with cutting edge digital marketing. With an MBA from Western Governors University and a passion for the craft, he offers a results-driven approach to digital marketing, ensuring your online success.

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