The fact that programmatic advertising is still a mystery to many digital marketers is understandable, as you can find too many elements in the mix. While programmatic marketing has become an essential part of omnichannel marketing, it is still too technical and jargon-filled for the world of digital marketing.
However, that does not negate that it is an essential part of the digital advertising world. With a curious blend of automation, data science, and machine learning, programmatic ads can be a complex topic to understand if not approached properly.
Luckily, this blog is here to help you cut through the confusion and understand the concept of programmatic marketing in simpler and easier terms. Here we will also explore why it is a great option for B2B advertisers.
What is Programmatic Advertising?
The automated purchase and sale of ad space in the digital world are called Programmatic Advertising. In the initial days of digital advertising, the sale and purchase of ad space were handled the same way ad space was dealt with in traditional paper magazines. The two parties would agree on which website to place the ad on and for how long.
While it was simple, the system was quite inefficient regarding ad space management and performance assessment. There were few options to monitor and measure ROI, ad performance, and create targeted ads making it difficult to operate ad campaigns effectively.
Rather than making data-driven decisions, a programmatic advertising company was forced to base its calculations on assumptions. The process became too time-consuming and inefficient since everything was done manually.
With the advent of programmatic advertising, digital marketers can now work with data-driven, algorithm-based software that automatically handles the sale and purchase of digital ad space within seconds. Moreover, it can also be applied to various formats and channels.
Programmatic advertising uses machine learning and marketing automation to match the advertisers to the publishers. In this type of advertising, the software integrates site data with advanced targeting methods to place ads more efficiently. This brings better ROI for publishers and advertisers alike.
Different Components of Programmatic Ads
The programmatic advertising universe is made up of the following platforms:
Demand Side Platform (DSP)
This platform allows B2B marketers or a digital advertising company to purchase ad inventories across different platforms.
Sell Side Platform (SSP)
This platform allows buyers to purchase display and mobile advertising impressions and videos in real-time. Also known as Supply Side Platform, the SSP also involves networks, ad exchanges, and DSPs, giving publishers more control over their CPMs and stock.
An ad exchange is a platform in which the supply side places its inventory. It sits in the middle of the programmatic ecosystem. It acts like the meeting point for SSPs and DSPs where they come to agree on trade inventories and a certain price.
Data Management Platform (DMP)
Unless the inventory matches with the right ad space, the programmatic ads won’t work. This is where the data management platform becomes important. DMPs are storehouses where data, analysis, and management are stored from various sources.
How Can a Programmatic Advertising Company Deliver Effective Programmatic Ads?
Understanding the Marketplace
The first step of creating an efficient programmatic ads campaign is to conduct thorough research of your target market to develop clear goals and objectives.
Setting your goals in the initial stage is important to choose the right programmatic platform. These goals will further help your sales funnel, customer segregation, and user engagement strategies.
While algorithm does play an important role in programmatic advertising, you cannot negate the importance of human intelligence. It helps to balance machine automation and human intervention to create the perfect strategy. Otherwise, your ads might appear impersonal and distant to the consumer.
Avoid Fake News and Programmatic Ads Fraud
One of the challenges plaguing the programmatic ecosystem is the tendency of websites to promote fake news. This takes place due to the heavy reliance on algorithms. To avoid such issues, you must keep updating your demand-side blocklist to sidetrack all inappropriate sites. In addition, you can also create a separate safelist containing the names of approved sites.
It is important to also watch for ad frauds, as they can cost you millions over a deal that might look too good to be true.
Measure Your Rates
With so many elements in the mix, measuring ad performance and scalability is essential. The most commonly used metrics for measuring programmatic advertisement are, Return on Ad Spend (ROAS), Return on Investment (ROI), and Click-Through Conversion (CTC).
Suppose you are a company with a substantial ad budget and looking to create personalized ads for each step of the customer journey. In that case, this is the avenue to take. The best way to utilize programmatic advertising is to collaborate with a repeat digital advertising agency that will build you a data-driven, effective marketing strategy.