There has never been a greater opportunity for advertisers to reach consumers using digital channels. Not only are consumers spending more time consuming online content, but there has been a rapid growth in the sophistication of targeting methods, as a result of technological innovations. The industry now has some of the world’s brightest individuals working within it, with competition fierce between advertisers as they battle to truly understand the needs of their consumers.
Programmatic advertising is perhaps the clearest example of a technological development that is helping advertisers to reap the rewards of the ever increasing always-on world. According to a report from BI intelligence, programmatic will account for over $18.2 billion in U.S. digital ad revenues in 2018, up from just $3.1 billion in 2013.
Put simply, programmatic advertising is about the automatic buying and selling of media opportunities on digital platforms. Instead of having an individual at the end of the phone who sells inventory, the whole process is automated. This process happens in real-time, so as soon as the impression loads, the advertiser bids against others based on the context of the website. The benefits of this are quite considerable. Here we summarise ten key points:
1. Greater targeting
One striking benefit is the opportunity to reach a target consumer group in a much more sophisticated way. Advertisers can isolate placements that provide appropriate content related to the group from across the whole online world, including apps. Based on the publisher’s detailed information, this process can be isolated down to unique pages within a site and also across a multitude of publishers. This is a clear benefit from a somewhat archaic method of purchasing volumes of inventory by speaking with publishers individually.
2. Clearer pricing
The cost to benefit ratio is top of mind for advertisers using any marketing channel and where programmatic clearly stands out from the crowd. By paying a fair price for each impression as a result of an auction process, advertisers can clearly get what they pay for. As a result, they are able to quickly manage their inventory, switching off placements that aren’t driving results to focus on those that are.
3. Balance of inventory
With the online world expanding at an unprecedented rate, advertisers are able to take advantage by cleverly balancing a range of inventory from both premium publishers and smaller, niche sites. This is in comparison to traditional methods where reaching niche audiences is more challenging as most inventory is purchased via thousands of impressions from premium publisher sites.
4. Perfect for mobile
The mobile opportunity is extremely exciting for consumers and advertisers. Recent research across major publishers highlights that more than 50% of media content is now consumed on tablets and mobile and this trend is only likely to continue to grow. Programmatic is therefore the option of choice on mobile as it is evolving based on the proven foundations from tried and tested desktop programmatic implementation whilst implementing new mobile specific innovations such as in-app advertising and the latest advertising formats (including interactive videos).
5. Native ad formats
The buzzword in the advertising industry, ‘native’ refers to ensuring that advertising blends in and sits in context with the content around it. Clearly, consumers are more likely to be engaged with relevant content but they are also more appreciative of content that is unobtrusive and doesn’t significantly affect their primary media consumption. Working with major publishers such as The Guardian and Twitter programmatic is becoming increasingly integrated, providing the best in personalisation and contextualisation.
6. Customer insights
Big data is very much in vogue across all business units at the moment. For advertisers, this couldn’t be more prominent. Understanding consumer behaviour is essential as well as determining return on investment. With traditional channels making it difficult to link behaviour with exposure, in contract programmatic enables a wealth of insights to be garnered. As well as highlighting which inventory is performing, details of the consumer types responding along with time of day and type of content (message, creative) can all be assessed and that is only for starters.
7. User acquisition channel
The mobile world has been revolutionised by the app economy and programmatic is fuelling this. With hundreds of thousands of apps now available to download on iOS and Android those developing them are keen to generate revenue whilst advertisers have the perfect opportunity to reach an engaged audience due to the enhanced user experiences that apps provide. One of the key benefits for advertisers (and particularly app developers), is the ability to advertise through other host apps (usually using in-app banners or videos). Users can have the opportunity to interact and for up to 45 seconds through an online video before being instructed to purchase (or download in the case of an app).
8. Agility, efficiency and scalability
By spreading inventory across a range of publishers it is possible for advertisers to remain agile to the needs of their consumers. This can be managed efficiently through the automation process – by buying inventory through the traditional process it would become unwieldy and difficult to react. Another key benefit resulting from this is ability to scale at speed. By identifying performing inventory, greater budget can be quickly allocated, making campaigns extremely reactive to market conditions.
9. Transparent reporting
Transparency when using any service provider is essential. With budgets under constant scrutiny it is essential to provide advertisers with a clear understanding of where their money is being spent and how it is performing. This is extremely clear with programmatic. With the efficiencies that automation provides, money is spent directly on inventory rather than administration or logistics. Reporting is also extremely clear making it possible to instantly understand the value that programmatic brings.
10. Easy to set up
Often the biggest barrier to adoption for any new technology is the effort required to set it up. This is one of the key strengths of programmatic. Due to the automation process, strategy can be quickly discussed and put into practice. A test phase can often be introduced to highlight the benefits before the advertiser becomes fully involved. This is in direct to comparison to the traditional model where relationships not only with the provider but also the publishers need to established and cultivated while inventory costs are negotiated.
By Charlie Faulkner, head of EMEA and APAC at Manage.com.
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