7 benefits of programmatic buying that change digital advertising
By the end of 2019, programmatic ad spending in the world will reach $85 billion according to eMarketer. Algorithmic ad buying niche demonstrates steady growth ever since it became possible to place ads automatically. Benefits of programmatic buying are obvious to demand and supply partners alike, that’s why experts suggest that all digital advertising will soon go programmatic.
Since GDPR came to play, advertisers have started to invest more in data infrastructure and media quality assessment in order to reduce programmatic costs and protect brand image. As data management and processing algorithms improve, the targeting capabilities evolve, programmatic display advertising becomes more and more effective for advertisers and publishers. Let’s find out how programmatic buying platform can instantly elevate your advertising campaign or discover how supply-side solution can drive substantially better yields in 2019.
1. It turns multichannel into omnichannel
Programmatic advertising advantages are endless but omnichannel approach is what really makes this technology unique in 2019. The number of channels the customers spend time at has grown radically, and the advertiser should be able to address them anywhere they are.
Here, the benefits of programmatic are working for both demand and supply parties. Programmatic allows advertisers to address customers on smartphones, tablets, desktop and even TV at the same time. Such cross-device digital marketing helps to coordinate campaigns on various devices, and show where the users respond to ads more actively. Same way, with publishers, the programmatic platform can investigate what is the most fruitful ground for their inventory monetization.
How good it can be: example. Benefits of understanding programmatic advertising can bring you an additional share of customers. That’s what marketers of Starbucks figured out when they launched the user loyalty program based on personal user cards. Such cards were linked to personal accounts that the user accessed via smartphone. If coffee was ordered via smartphone, the app calculated what time it would take the user to get to the Starbucks. By the time of arrival, the coffee was already prepared for the customer.
2. It makes advertising individual
Real-time bidding helps demand and supply partners trade in real-time. Programmatic advertising delivers ads accurately, according to the target options and trading parameters. In simple words, AI and MA algorithms channel a particular ad unit to the specific user at the time when it will be seen most likely.
For example, a brand can use programmatic to interact with specific segments of consumers, targeting according to the device, geolocation, personal interests, and content.
How good it can be: example. Every time the user opens a publisher’s app or a website, the bid request along with user information is sent to an ad exchange. It’s like saying, “Hey, user X is 35 years old; lives in Montana; uses iOS; interested in cars, football and traveling; possibly married; and most likely self-employed. He is about to see an ad. Who wants to advertise to him?” Judging by the user’s characteristics, advertisers’ demand-side platforms determine whether this view-through is valuable. If yes, they bid on it. Display ad is served.
It’s a win-win. Publishers earn money from showing ads to niche audiences, while brands get the chance to reach prospects with relevant ads, anytime, anywhere.
3. Benefits of programmatic ads in audience extension
One of the main features and benefits of programmatic advertising is considered the ability to automatically reach the audience segments that are most likely to convert.
Benefits of programmatic today include look-alike modeling that makes user-acquisition reasonably cheap. This means that AI and MA algorithms have earlier defined that certain audience segments have a good history of clicks on this or that type of advertising. The system detects entirely new audiences who may also be interested in your product or service.
How good it can be: example. A clothing brand that manufactures sportswear for snowboarders found out that their sports accessories, especially sunglasses, are regularly bought by the completely new audience — cyclers, hikers, and teenagers who know that sports glasses turned into a fashion trend.
4. Advantages of programmatic ads and user data
One major benefit of programmatic advertising is that it offers a holistic approach to data management. Components of the programmatic ecosystem are tightly integrated, they keep information organized and in one place.
For instance, data management platforms collect first- and third-party data on existing consumers from different channels, devices, offline and online sources. The platform can gather and analyze user segments in real-time.
Demand-side platforms or supply-side platforms subsequently use the output in order to fine-tune advertising options according to behavioral factors, personal preferences, and tastes of the potential customer.
Data analytics is also one of the benefits of programmatic advertising. It is used to reveal patterns and get actionable insights to support business decisions. Machine learning techniques allow predicting outcomes of advertising campaigns and warn marketers about possible pitfalls.
How good it can be: example. The user data is a crucial component that makes advertising geofencing advertising campaigns effective in 2019. Analysis of additional information helps marketers to determine user behavior patterns in order to use existing opportunities with maximum effect. A good example is a chain of Red Roof Inn hotels. The marketers used information about flight delays to launch targeted mobile advertising. If there was a Red Roof Inn near the airport, passengers received an advertising message inviting them to the hotel. As a result, the hotel increased sales by 60%.
5. Infinite supply and demand in programmatic advertising
Another benefit of programmatic marketing is that it provides immediate access to the pool of digital inventory. Through a demand-side platform, advertisers break into the market right away and can immediately start buying digital media inventory from a myriad of publishers worldwide. Inventory of all shapes and formats — both premium and remnant — is available through programmatic platforms. Meanwhile, publishers enjoy the benefits of the increased demand during programmatic buying, which allows them to sell impressions at competitive prices and successfully monetize their traffic.
How good it can be: example. Programmatic solutions offer various methods of ad buying. For instance, marketers can buy inventory on a per-impression basis through real-time bidding auctions, or they may opt for programmatic direct deals and buy guaranteed ad impressions from specific publishers. Alternatively, there are private marketplaces (PMPs) where premium publishers offer exclusive niche audiences to invitation-only members. Finally, there are preferred deals that are fixed price agreements between publishers and advertisers.
6. Safer advertising ecosystem for everyone
Ad fraud affects all digital marketing, creating malicious traffic. As a result, the ads are seen not by people but by bots that never convert into customers. The brand image risks appear when the ad is served near inappropriate content. Another issue with transparency is related to inflated prices and commissions inside the chain.
The benefits of programmatic buying in 2019 include increased transparency during trading and the chance to secure purchases with advanced programmatic tech.
How good it can be: example. One of the critical safety solutions that appeared last year was ads.txt. It authorizes individual media-sellers that are eligible to sell the inventory. Also, in 2019 IAB Tech released ads.cert, which is responsible for delivering clear and detailed information about inventory. The big step towards transparency and safety of programmatic advertising is adoptions of first blockchain-based ad platforms, which are safe, secure, and incorruptible by design.
7. Programmatic advertising benefits in reporting
Another benefit of automated media buying is that it provides robust reporting and granular analytics in real-time. Media buyers and publishers can access reports through dashboards and track ad performance according to key marketing metrics such as click-through rate (CTR), traffic, conversion rate, bounce rate, consumer engagement rate, brand awareness, and overall ROI.
How good it can be: example. Programmatic platforms offer a variety of analytic tools to provide users with insights into what is going on. No need to calculate everything manually, machines handle all calculations.
As digital advertising is hitting its stride, it is essential to include programmatic into your overall marketing strategy. Programmatic media buying benefits are focused on personal message delivery instead of serving mass ad campaigns. This way, you keep your advertising relevant and reduce the percentage of wasted impressions. The programmatic mechanism is like ever-evolving autopilot for your advertising that constantly controls ad campaign workflow based on pre-selected data. Essential knowledge basics in this area today is enough for mastering the art of professional digital advertising that’s efficient, timely, and up to a point.
Contact us now to find out how to achieve all your ad goals with programmatic!
IRINA KOVALENKO, CMO OF SMARTYADS