Programmatic: what it is and how to use it

Tuesday, 13 October 2015, by Rosie Kenyon

So, what is programmatic (ad buying)?

The end result of programmatic, and why people are excited about it, is an efficient and effective route of targeting the right people - with the right ads/videos/other content fun, at the right time. 

Working with thorough data sets and the right tools (different types of software available), programmatic ad buying systems allow the user to input the parameters and content of their digital advertising campaign and let the combination of data, software and robust robotic knowledge adapt and tweak it as it progresses. 

This aims to give a more refined campaign that works with you to put your content in front of the right eyes at the right moment, bringing back the best return on investment.

 

The bits we need to know to understand programmatic:

  • It cuts down on some manual labour and there are a few different platforms which allow the buying of ad inventory in programmatic fashion.
  • Inventory is the amount of ad placement on a site that is available to purchase; commonly sold as ad impressions eg. I will pay you £1000 for 1000 impressions of my ad on your site.
  • An ad impression is counted every time someone (or something) views an ad. 
  • Programmatic uses systems which allow the transaction of buying digital media space to occur digitally, rather than calling someone up and asking if you can put an ad on their site.
  • Programmatic ad buying can be done using a Demand Side Platform (DSP).  A demand side platform is where advertisers can buy display ad inventory. 
  • Demand Side Platforms also allow for analytical overviews such as looking at the Cost Per Click (CPC), or Cost Per Action (CPA).
  • Programmatic buying could also be carried out using an ad exchange platform.
  • An ad exchange is a digital platform that provides for the buying and selling of media advertising inventory.  The prices on this exchange platform are determined through the bidding from multiple ad networks, often in real-time auctions. 
  • Third option; programmatic buying can be done with the help of an Agency Trading Desk (ATD).  These will often use DSPs and work in a similar format to the stock exchange, helping advertisers to buy media for their specific audience, on a large scale.
  • It is up to a website to choose whether or not their ad inventory is up for grabs in the programmatic world.  Currently, more and more companies are choosing to sell their ad space in this way.

 

 

 

Programmatic so far

Nearly half of UK online display ads were bought via programmatic last year.  This amounts to almost £1bn in spending, according to research from the Internet Advertising Bureau (IAB).

In a report from AOL, over half of publishers (51%) said they are currently making their premium video inventory available for sales via programmatic.

Publishers hold varying amounts of power according to the amount of inventory they have and impressions they receive on their site.  Big and invariably important publishers currently in the digital sphere include:

Facebook

Huffington Post

Netflix

Google

Twitter

Wired

Mashable

YouTube

The Guardian online

Stumbleupon

National Geographic

Bing

Criagslist

you get the picture…

Earlier this year, four big publishers announced a programmatic ad alliance in ‘Pangaea’.  With CNN International, the Financial Times and Reuters as founding partners, and The Economist also joining in to provide access to ad inventory.  In Pangaea, with partners sharing their first-party data, advertisers will be offered the ability to understand an audience, delivering “hyper-targeted campaigns and deeper connections with readers”(theguardian.com).  The platform will be managed by a dedicated sales team so that advertisers have an easy port of call through which they can sort their needs.

 


 

A concept/word that is often associated with programmatic: retargeting

Retargeting is when you go and look at buying train tickets online and then later, when you are browsing your news platform of choice, an ad pops up for a site selling train tickets. This digital stalking behaviour is known as retargeting and is one of the more successful digital display ad techniques. 

Try looking at the Huffington Post website for example and seeing what ads pop up and then view the same site in an 'incognito' browser window and see how the ads differ.  

Why does it appear when programmatic is in the hot seat?

Because of its success rates, retargeting is a feature that often turns up in programmatic campaigns - since programmatic enhances the ability to work out the most effective strategies and ways that your content will be seen by the right people for the best ROI; if the best ROI is found when retargeting takes place then retargeting will take place.

Good to know: Retargeting takes place through the use of cookies.  Cookies store data on your web browser activity and can track your activity across a site.  Through the use of cookies, this method of retargeting can be used as the clever bots can work out where you’ve been and as a result, predict your interests and the types of ad you may like to see.

 

Key things to remember

There are a variety of ways in which digital ad space can be bought but ultimately, it is the research into the target audience - the knowledge of the needs and wants of your audience - that produce the most effective campaigns.  This has always been crucial in campaign success but in this fierce competition for attention online, it is more important than ever to know who you are talking to and why they would want to hear from you. 

The content that you are going to put in front of your audience needs plenty of thought - catering to specific audiences as much as possible - your content shows that you understand what it is they are looking for, you have what they are looking for, and you are making the process of them finding this nice and convenient. 

The content you produce will differ according to the stage they are at in the buying cycle, and who they are. 

Planning what you are going to deliver, at what stage and to whom, will give you a clear overview of how you are going to achieve your aims. 

For example, if your aim is to raise awareness (people at the beginning of the buying cycle) of your fitness brand with people aged 18-26, a starting point could be a video which is advertised on YouTube (the second biggest search engine after Google, source: socialmediatoday).

There are so many ways to communicate messages; having clear aims and a solid understanding of the audience allows a strategic route to be plotted out and will help to keep the campaign on track. 

Happy plotting!

P.S. Here’s a rhyme for reading all the way to the end:

Programmatic is not problematic,
least it should not be,
for you and me or any agency,
using super big data,
it really can cater,
to a specific degree,
narrowing down,
it may just wear the crown,
of total efficiency.

 

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