Programmatic advertising (also known as real-time advertising) is an emergent technology that uses Artificial Intelligence and machine learning to buy, sell or fulfil advertising in real-time.
What is programmatic advertising
Programmatic advertising is a relatively new instrument within media and advertising in general that has become a key element in most digital ad budgets for its scale and efficiency in targeting and placing digital advertising.
According to the Zenith Programmatic Marketing Forecasts 2019 Report, more than two of every three display ad dollars are being spent programmatically. According to the same source, the US is by far the largest programmatic market by ad spend, worth US$67bn in 2019 , accounting for 64% of all programmatic ad spend, and responsible for most of the growth.
Programmatic advertising advantages
Programmatic is an efficient way for running advertising campaign. Here are some advantages it brings:
Overall efficiency - It is one of the most optimal ways of running every campaign. Programmatic helps in sending right message, at the right time with the right format. Thus, the technology helps in using the budget in the most efficient manner.
Next-gen ad system- Relying on algorithms for determining ad spends and getting full- fledged tracking report with deep insights for every impression is a winning game for advertisers.
Time efficiency - Once the tags are entered into the system, advertiser needs to sit back and track each campaign. Simultaneously, he may think of launching new campaigns and ways to expand it.
Micro targeting uber-segmentation - It is beyond human limitation, to dig deep into every rows and columns of data to get into the countless data points. This kind of rendering is only possible through high-level planning and processing done by algorithms.
Wider audience pool - Programmatic accesses digital properties cross screens. It not only caters to web media houses but in gaming apps as well. Thus, you can target ads to wider audience pool.
Programmatic advertising disadvantages
Many advertisers have highlighted certain disadvantages such as:
Ad blockers - Most internet users complain about how the ads pop up and so have resorted to using ad blockers.
Fraud - At times, marketers pay for programmatic ads but the publishers fail to fulfil their end of the bargain.
Privacy issues - Privacy concerns have arisen as programmatic ads are based on individual internet users’ information.
Questionable sites - At times, brands have complained that their ads appeared on sites or content that went against their core values.
How does programmatic advertising work?
There are three main players in any programmatic effort: the advertiser, the publisher and the audience.
- Advertisers are brands looking to promote their product, service or idea.
- Publishers are the sites or apps with available ad inventory.
- The audience is the group of potential buyers or investors that advertisers are looking to reach.
What is programmatic advertising important
By removing some of the repetitive tasks, programmatic advertising allows companies to reserve human labor for high-value tasks. Using self-service platforms, companies are finding ways to take their programmatic ad buying in-house, rather than going through media agencies.
For example, companies can use Real-Time Bidding to advertise to users who visit their website, but don’t make a purchase. As a visitor enters a website, a request is sent to an ad-exchange (a trading floor where advertisers can buy ad space from multiple ad networks) with information on the website, along with visitor data. This information is then matched against available advertisers and a real-time auction takes place between the advertisers that match the criteria.
What is premium programmatic advertising
Premium Programmatic Advertising is another automated technology-driven method used for buying, selling, or fulfilling advertising. Faced with pressure from clients demanding more transparency and better inventory, agencies are moving more deals out of the open auction and into the premium, that allows them to apply the programmatic fees, while also allowing for safe, efficient and transparent programmatic media buying.
Programmatic trading revenues and investments are set to increase, regardless of market or stakeholder type.