In the case of programmatic, what was recently the next big thing is now THE big thing.

Despite this, marketers and publishers are struggling to embrace it, seemingly blinded by the highly innovative technology and unable to focus on the major benefits it brings.

Predictions of growth for the sector, currently valued by Zenith Optima at $122 billion, are huge. Programmatic spending is expected to increase by over 200% to $2 billion during 2015, according to eMarketer. This adoption of programmatic advertisement buying and placing has also led to an estimated 26% growth in traditional digital display ads, which is expected to continue to emerge further as technology develops. No wonder it is quite rightly being heralded as the future of advertising.

So let’s take a step back from the tech, and focus on programmatic’s potential to revolutionise advertising as we know it from a targeting and engagement perspective – the key to driving sales.

On target

A big issue for brands has always been the effectiveness of online advertising, both in targeting audiences accurately, and in terms of measuring engagement with consumers. As the programmatic industry continues to improve targeting and the accuracy of measuring it, data has been pinpointed as the key to further enhancing it.

As Nick Hugh, vice-president and general manager, advertising at Yahoo EMEA, commented recently, the accuracy of programmatic targeting is closely allied to its data source.

“Take our recent work with a large retailer on a [programmatic] video campaign, which was achieving around a decent 50% in terms of in-target efficiency,” he said. “Using segments from Yahoo’s database, which has now been integrated [into Yahoo’s programmatic system], results have rocketed to over 80% in-target.”

So incorporating first-party demographic data into programmatic technology can have a significant effect on targeting. Now, 80% accuracy is excellent and will hopefully go a long way to convincing advertisers further of the benefits programmatic brings in terms of brand engagement, helping to unblock spending. But why stop there? If demographic information can boost targeting to this level, what type of data could be integrated that would push it up towards 100%?

Harnessing the user

A growing number of brands are harnessing the power of user generated content (UGC) through reviews or community forums, as it encourages discussions about items, helping customers buy, but also provides insight into what consumers want. A high fashion e-commerce website recently developed an app to do just that. By blending online shopping with social media, customers can shop in real time with their friends, wherever they are.

Gathering designers, celebrities, bloggers and trendsetters in the same place allows shoppers to canvas the opinions of the experts. Plus consumers can search for items with a preferred motif from the real world, such as a flower spotted in a local florists or a pattern on a friend’s sofa, by sharing a photo of it. And of course it’s possible to buy through the app.

Just as importantly, shoppers can now share ideas and advice on fashion with their friends and ask their opinion.

Tapping into behaviours

Just imagine the conversations taking place. “Do you think this top goes with these trousers?” “Have you seen anything that would go this these shoes?” “What’s the trendiest look this summer?” “What are the colours for the autumn?” “Do you think this will suit me?” “I need to get a dress for a friend’s wedding, what’s the most affordable smart, but trendy one?” And so on…

If this kind of real time social data could be incorporated into programmatic technology, it might be possible to target advertisements when relevant topics cropped up in such conversations on social networks – then leveraging the power of the social ad exchanges to profile and target them programmatically. The ability to focus on positive sentiment would be key to tapping into consumers at the relevant moment and in a buying frame of mind – the optimum situation for advertisers. Making it possible for people to buy through those ads would surely boost conversion rates enormously.

But can we take it further still? Technological innovation is throwing up all kinds of behavioural data – location, most active time of day, preferred apps and websites, loyalty card buying patterns cross-referenced with credit and debit card records, and shopper journey data from in-store RFID tags. Plus there are the non-connected data sources of the TV and out-of-home channels. All this data, if relevant, could be integrated with UGC to paint an even clearer picture of consumers, and their thoughts, needs and shopping habits.

It won’t be too long before programmatic technology can handle and evaluate all this rich behavioural data to enable brands to target their advertising like never before. So programmatic is not just driving digital advertising, it is also working to make it more effective than ever for marketers and their brands. And by sharing their data, marketers can help make this a reality sooner rather than later.


By Nick Wild at PRGRMTK

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