What is Programmatic Advertising?

2021-04-08

"Programmatic Advertising is a $15 billion market and it's only getting bigger every year because it allows brands to deliver ads that are relevant to real human beings." - Joshua Spanier

Taking reference of above quote, we can claim that Programmatic Advertising will become a default advertising method of the online industry in upcoming days.

Programmatic Advertising AKA Real Time Bidding is an automated bidding system for buying and selling of ad inventory.Ad slots for digital out-of-home (DOOH), online, streaming, TV, video and voice ads are included in Programmatic advertising.For audience segmentation, targeting,frequency capping and attribution, programmatic advertising relies on cookies

History and Present Status of Programmatic Advertising

On October 27, 1994, hotwired.com launched the first world ad banner which brought 12% CTR. Its successful elevated demands from advertisers. In 1996, ad servers were created and DoubleClick(which is now merged with Google Marketing Platform) among first ones.These events led to emergence of first ad networks in 1998-2000. However, neither publishers, ad networks nor advertisers got ideas about tracking the progress and targeting the right audience. Solution to these two issues was ultimately covered by Programmatic advertising. Programmatic advertising experienced a revival due to Covid pandemic. Sources that time also predicted advertisers would spend $98 billion on programmatic advertising.In 2021, the programmatic ad industry will be focusing on planning for P3PC (post-third-party cookies, growth of in-house programmatic, asset optimization, and adopt emerging formats like: CTV, DOOH.

Important Concepts in Programmatic Advertising

DSP (Demand Side Platform)

DSP is a software used in Programmatic Advertising which works for advertisers where it facilitates advertisers about their target audience,location, and maximum bid range.

SSP( Server Side Platform)

SSP is devoted to publishers.SSP software brings details about minimum Price range, types of audience (segments), and available formats.

Ad Exchange

In Programmatic Advertising, Ad exchange connects DSP and SSP. Its chief job is to facilitate the bidding process.

What can Programmatic Advertising platforms identify about online consumers?

Demographics which includes age and gender
Geography- location nearby a famous landmark
Interests and hobbies (surfing, saltwater, California)
Time of the day to consume and surf content
Devices used by consumers (smartphones)

Benefits to Programmatic Advertising

Ability to make more informed data-driven decisions and not have to focus so much time and energy on the advertising process.
Programmatic is an innovative and effective method of targeting allowing advertisers to target audiences and utilize different tactics.
Effective messages across many preferred channels can be sent to reach the more desirable viewers.
Advertisers can control the audience which allows significantly better measurement of ROI from an advertiser standpoint.

Issues and concerns of Programmatic Advertising

Ad Fraud

Ad fraud is an activity which inhibits the delivery of your ad to your target audience at the right time, in the right place. If a publisher gets your ads clicked by bots and brings impression or provides you less quality traffic then its ad fraud. In 2019, 42 billion dollars was ingested by ad fraud making it a global concern in the online industry. This number is estimated to increase 50 to 60 Billion dollars. These bots also steal valuable cookies.ad fraud online ads are often not directed at a single person which makes ad fraud to flourish well.

How to be safe?

Purchase and use ad fraud protection tools like: Think guard.

Viewability

Programmatic industry’s another issue is Ad Viewability. Programmatic ads are found to be delivering 10% less Impressions in view when compared to direct buys. This factor makes advertisers doubt on programmatic inventory.

In fact, some fraudulent websites or sometimes your competitors can accelerate your viewability rates by 70% which decreases the time span of your ad as well as make your ad exhaust soon.

How to be safe?

Work on Active View tags and check your viewability settings regularly.

Brand Risk

Brand risk has both financial and reputational implications. Reputational risk is more lethal. As it deals with the brand's communication, delivers and its accessibility. Running ads meaning taking risk to get their ads to be shown on websites having adult content, alcohol, drugs, violence, offensive language and other. This increases reputational risks for brands.

How to be safe?

Perform brand risk audits and environmental scan

Pro tips

Choose SSPs with fast delivery with low high auction prices.

Ensure clear and professional communication with your DSP.

Address ad frauds, brand risk, and problems of viewability.

Optimize your mobile programmatic advertising strategies.

Make optimum use of data to drive your strategy.

Final Thought

Programmatic advertising enables marketers/advertisers to reach their target audiences more efficiently than ever before using digital media to deliver the best results. Missing out on making appropriate use of automated advertising innovations could risk your opportunity to save money and see better results on your online advertising campaigns. You must try to address the issues within ad inventory and utilize pro tips to get better use of programmatic advertising.

What is Programmatic Advertising?