A new buzzword is haunting the creative industry: Programmatic Advertising.
Most, if not all, creative agencies around the world have been relying on this fast horse for a long time. But what really is programmatic advertising?
Programmatic Advertising in a Nutshell
First of all, the term programmatic advertising refers primarily to the digital domain. So it’s not about the good old advertising pillar or the analog billboard, but about advertising which is presented online.
Programmatic advertising means reaching the right users.
With programmatic advertising, marketers deliver their material automatically and individually in real time using a video ssp platform. Through this, they are able to reach the right users, at the right time, in the right situation, and with the right message on the right device.
The auction process is called Real Time Bidding (RTB), which means that ad placement prices for each ad slot are negotiated in real time as part of an auction.
What are the Benefits of Programmatic Advertising
Programmatic campaigns are more successful than classic display campaigns
With programmatic content, advertisers can create targeted advertising experiences and increase efficiency
- Cost saving
- Creative advertising material: programmatic video, animated HTML5 banners, customized advertising material, etc.
- Automation and custom delivery increase the efficiency of digital media planning and reduce CPA / CPO costs.
- Programmatic Advertising enables highly targeted targeting and retargeting (user behavior, geography, placements, keywords, audience, device, and semantics)
- For programmatic campaigns, the advertising business model can be customized to meet the campaign goals. Thus, sales with real-time purchasing or branding with TKP-based campaigns is possible
- Transparency: Full performance transparency with optimal cost control
For Whom is Programmatic Advertising Suitable
Due to the extensive configuration and control options, this programmatic advertising is particularly suitable for medium-sized companies and larger companies with a higher advertising budget. Because of its complexity, advertisers should also expect higher costs for set-up and support, which, however, quickly pay for themselves through a sufficient increase in sales or conversion. Above all, it is suitable for those who have an online presence and expand their markets there.
How do Programmatic Advertising and Real-Time Bidding Work
Programmatic Advertising refers to the automated booking (programmatic buying) of online advertising spaces. This is made possible by the data we leave behind when using our computers, tablets, and smartphones. All are necessary data and information in the advertising system, controlled by algorithms. These ensure that offers and demand are linked together, and the corresponding advertising material of the desired target groups is displayed.
The process in detail
- A user clicks on a link and ends up on a publisher’s website, which analyzes the visitors’ behavior and preferences using tracking procedures and uses them to create user profiles.
- The publisher offers these user profiles and their available advertising space (inventory) through a sales platform. He sets a minimum price for an ad impression.
- This ad impression will now be offered to advertisers via a sales platform in a real-time auction.
- Advertisers, in turn, use a shopping platform (Demand Side Platform, DSP for short) to define which ad impressions and target groups they are interested in and the price they are willing to pay.
- The highest bid will be awarded, and the winner’s ad will be promptly delivered to the visitor’s website by its advertising server.
- While the visitor loads the website, the entire process runs millions of times in the background and in fractions of a second.
Programmatic advertising is an indispensable part of any marketer’s work because the most creative work and the most relevant texts remain ineffective online. If one does not prepare these creative campaigns in such a way that they are played automatically and purposefully to the right audience, at the right time on the right device, they disappear unseen and unheard in the space between the web pages. But combining your campaign with programmatic advertising gives you a powerful and cost-effective tool for quickly building and expanding your online presence.