Is Programmatic Advertising Right For You?

Advertising has evolved significantly during the previous decade with some technological shifts.

Hence, it has opened various options to reach your target audience. We have seen the rise of digital marketing and advertising through websites’ ad place.

Business owners desired more adverts to be placed on other people’s websites in order to increase the number of people who saw their brands.

This resulted in a clash between business owners over ad placement.

This is exactly where programmatic advertising helps! But then, one more question arises: How would I know if it is right for me and what’s the whole process of it?

Well, it goes by using real-time bidding, in which business owners bid for specific ad space and have their ad posted.

It is becoming a great strategy as a lot of business owners are spending about $60 billion every year.

Many big brands around the globe are using programmatic advertising like Google, The Economist, and Kellogg’s.

These are some of the best programmatic advertising examples.

However, unless you have a deeper understanding of programmatic advertising, getting to the point where you can quickly locate a decent bargain for ad placement that would produce you more money would be challenging.

Don’t worry! Here in this blog, I am going to elaborate on each and every step to successful programmatic advertising that is going to help you in getting a better deal and generate high revenue.

So, let’s get started without wasting a single second.

What Is Programmatic Advertising?

If you ask me to define Programmatic Advertising, then I would say, Programmatic Advertising is the automated purchasing and selling of Online Advertising.

Programmatic advertising is the use of artificial intelligence and machine learning systems to acquire digital advertising space.

You can take it as a “spray and pray” method of Digital Marketing.

Here the advertisers only pay for advertising that is delivered to the right people at the appropriate time utilizing targeting strategies.

And in this process, the automated algorithms make the ad buying, placed, and optimized.

In other words, if you’re a business owner, you’d contact a website owner who has a lot of traffic and a similar audience to yours.

And it’s there that you would ask for ad placement in exchange for money.

This process is known as programmatic marketing, and it is now completely automated and software-based.

Still wondering how it helps the big brands?

Don’t worry! Let me make this a little simplified for you with the help of one of the most common programmatic advertising examples.

Do you know Kellogg’s also started programmatic advertising back in 2014?

The company chose to use digital ads to drive offline sales and achieved this target with programmatic advertising.

The viewability has increased from 70-80% and Kellogg’s improved its targeting by 2X to 3X.

But it was not that easy for Kellogg’s because the biggest challenge was the company depends on offline sales and digital marketing poses the biggest challenge for them.

The challenge was to align between online advertising and offline purchase.

That’s why Kellogg’s looks at KPIs like viewability and frequency.

Viewability: It is used to measure whether a user saw the Ad.

Frequency: The number of times a person sees an ad and the number of times an ad platform provides an ad.

Using programmatic advertising, Kellogg’s maximized the performance of these KPIs.

Also, the company partnered with DoubleClick (ad management and ad serving solution) to grow its audience targeting.

And these were the results that Kellogg’s received.

70% increase in viewability rates

2X to 3X better audience targeting

Can you imagine if a brand that is selling offline can receive these results then, how much you can receive if you have an online business?

If you don’t know what KPIs are and how to use them for business, you can check out this blog.

Related: 27 Marketing KPIs You Should Be Tracking to Achieve Your Business Goals

How Programmatic Advertising Works?

If you are clearly just eager to know if programmatic advertising is right for you or your business, you should first understand the whole process of programmatic advertising and then make a decision if programmatic advertising is right for you or not?

Above we have seen an excellent example of programmatic advertising i.e Kellogg’s but we haven’t seen how it works.
Here I am going to elaborate on the whole process of how programmatic advertising works.

So, let’s get started!

In capsule form, we can see the entire process in several steps.

1.The owner of the website auctions off the ad place (SSP)

2. Advertisers compete for ad place by submitting bids (DSP)

3. The ad impression goes to the highest bidder.

4. The user sees the advertisement on the website.

However, because the entire process is now automated and software-based, the procedure has only been somewhat improved.

Let’s see how the process works in 2022.

First of all, see the given image below:

This is the whole chart of how advertising works.

Before you understand the whole process, here are some concepts that you should first understand.

RTB (Real-Time Bidding): RTB is a method of buying and selling advertisements using real-time auctions, which means that transactions are completed in the time it takes for a web page to load, which is typically around 100 milliseconds.

Ad Exchange: Ad exchange is where the publisher meets the advertiser and agrees on a particular amount for an Ad placement.

It functions somewhat like a trading floor of the stock market. The Ad exchanges operate through real-time bidding where an ad purchase is made at the same time as a visitor loads a website.

DSP (Demand-Side Platform): A demand-side platform is a technology or program that allows marketers to automatically purchase ad spaces.

SSP (Supply-Side Platform): Publishers use a Supply-Side Platform to manage their display space in the same manner that advertisers use Demand-Side Platforms to handle their programmatic ad purchasing.

DMP (Data Management Platform): A data management platform is employed to gather and sort the data.

DMPs are most commonly employed in programmatic advertising in conjunction with a Demand-Side Platform on the advertiser’s site – or a Supply-Side Platform on the publisher’s side.

So, you understand all the concepts carefully. Now, it’s time to understand the whole process of programmatic advertising.

The Ad placement on the websites started even before the Facebook and Google Ads came into existence.

Related: What is Better: Google Ads vs Facebook Ads

The business owners manually used to go to the publishers for the Ad placement on their website and negotiate for money.

When the website publishers and business owners increased. It led to several clashes like, many business owners wanting to show up their Ads on the same website.

So, there came, bidding between the business owners for the Ad placement on a particular website.

To resolve such clashes, a software based and automated process was required.

Now, we have only 2 elements, one is Advertiser and other one is publisher.

Then, came a famous Ad network called GDN (Google Display Network) and many publishers used to come under GDN. it takes the monetization of the websites through Google AdSense. It was acting as a broker between the advertiser and publisher.

Then, came one more Ad network called, FAN (Facebook Audience Network) and it also took many websites under it.

Then, there were other lots of Ad networks as well.
Like there were Ad networks to manage the publishers, there also came ad exchanges to manage the Ad networks.

Collection of publishers became Ad networks and the collection of Ad networks became the Ad exchange.

That simply means, if an advertiser wants to advertise its Ad on websites, he needs to contact the Ad exchanges and not the websites directly.

Then, there came one more problem, the problem was publishers could not directly contact the Ad exchanges and the same went with the advertisers. Advertisers could not directly contact the Ad exchanges.

To resolve this problem, there came two more software, SSD (Supply Side Platform) and DSP (Demand Side Platform)

The process somewhat looked like that.

For the advertiser’s side, there was software, DSP (Demand Side Platform) and for the publisher’s side, there was, SSP (Supply Side Platform). The program served as a conduit for communication between Ad Exchange and publishers, as well as between Ad Exchange and advertisers.

What an Advertiser needs to do is to buy a place on the website, so he would just contact the DSP (Demand Side Platform) and show the requirement to it. The DSP (Demand Side Platform) would go and Ad exchange is the actual platform where the buying and selling of Ad placement go on.

Then, the RTB (Real-Time Bidding) takes place in the Ad Exchange.

This is the complete ecosystem of Programmatic Advertising that I have already shown in the image above.

But then, there comes one more tool between DSP (Demand Side Platform) and Advertisers that is, DMP (Data Management Platforms). These are the software that collects the data through the internet about the target audience.

The collected data is taken by the Advertisers and then, they use this data for demand creation in DMP (Data Management Platforms).

This is the process of Programmatic Advertising. Also, this process is quite expensive.

Now, let’s come back to our main question: how would you come to know if Programmatic Advertising is good for you?

It’s time to understand the benefits of programmatic advertising.

Benefits Of Programmatic Advertising

Here is the list of benefits you are going to get if you go with it. This list is going to help you decide whether you should go with it or not.

Real-Time Measurement And Optimization

With programmatic advertising, you don’t need to wait for the excel sheet from publishers to see how many clicks your Ad is getting. You would get the performance of each Ad measured in real-time.

Programmatic Advertising allows you to adjust and optimize your adverts, test and enhance the outcomes, and see exactly how much you spent on the Ad with programmatic advertising.

Isn’t it every marketer and advertiser’s dream?

You don’t have to wait until the conclusion of the campaign to see results, unlike traditional advertising such as billboards or print ads.

You can even do Pre-optimization. Pre-optimizing your campaign can help it get off to a better start right away, as you won’t have to wait to make a number of apparent modifications.

The optimization procedure would expand on the work done during pre-optimization once you’ve launched.

At this point of time, you can get ready to begin your campaign after everything has been set up. You could have a very clear campaign objective in mind by now, and you can even choose a major marketing KPI (Key Performance Indicator) that best connects with that goal.

For example, if you are trying to generate sales on your Ecommerce store, most probably you would want to focus on cost per sale, which we call CPA (Cost Per Acquisition).

To optimize the Ad effectively, every optimization point should be focused on this metric.

After the campaign has been started and data has been collected, you should see a distinct pattern emerge that is going to guide your adjustments. Some ecommerce sites, for example, may have a greater conversion rate on desktop than on mobile.

BID FACTORS should be changed to be lower on mobile and higher on desktop if the data supports this. Depending on how substantial the performance difference is, you may want to fully disable mobile.

Spend The Budget Wisely

You can use the Ad budget smarter by eliminating the waste on viewers who are unlikely to be interested in your product.

Here’s how it helps you.

It allows you to target users on a global level. You can target viewers with the appropriate message, in the right location, at the right time if you have access to massive amounts of data (GDPR compliant, of course).

Hence, you are going to spend your budget wisely.

Unbiased Marketplace

Programmatic auction uses digital mechanisms to create a fair playing field for all participants.

Loopholes like bid-caching and favored proprietary container treatment have created a skewed playing field for both publishers and purchasers in a less open economy.

The true value of inventory space may emerge with a more open economy. This would contribute to a level playing field, with no hurdles or costs in the way of targeted inventory.

“Opaque transactions and fees make programmatic advertising difficult and complex. They create avoidance from buyers and commoditization of inventory for publishers. Neither party is happy. Transparency can bring about a shift in the mindset of programmatic, helping to foster a balanced ecosystem where buyers know what they’re paying for and publishers feel their inventory is valued.”

– Cory Schnurr, EMX Director of Demand Strategy and Partnerships

High Audience Reach

The high audience reach is the biggest benefit of programmatic advertising. On average, 3.5 billion individuals use the internet at any one moment. Millions of individuals might be reached in this way.

And of course why not? If your Ad got placed on a website that has high traffic, you too are going to get high audience reach.

Although it’s always great to focus on those ideal customers, this massive potential reach is not only amazing but also easily trackable.

Advertisers know how many impressions a display advertisement received, who looked at it, where they were online and much more as soon as it was viewed.

Measurable ROI

It’s practically hard for buyers to determine how much of their ad budget is really allocated to final bids in a less transparent marketplace.

As a result, determining the real return on investment of the given media expenditure is quite difficult.

A more open marketplace entails quantifiable Return On Investment (ROI). For buyers, this includes providing accurate information to customers to demonstrate the benefits of their programmatic investment.

Clients are more inclined to make larger expenditures when they see real outcomes, which generally translates to greater bids for publishers.

These are some fine and biggest benefits of programmatic advertising. Just think how beneficial it is going to be if you use this way of advertising.

Read the blog below, if you are eager to know what kind of advertisement the audience likes.

Related: 42 Best Creative Advertising Ideas to Get Inspiration

Programmatic Advertising Examples

The examples I am going to provide would help you understand how programmatic advertising has benefited some large businesses and if it’s good for you.

Let’s get started with the biggest brand in the world, Google.

Google

In 2014, Google discovered the power of programmatic advertising when it was trying to promote its Google Search App.

Its ad campaign not only reached 30% more individuals three times as often as before, but it also had a 30% cheaper cost-per-thousand-impressions (CPM). The number of people who knew about it climbed by 50%.

Google’s ad targeting was built using first- and third-party data, allowing the corporation to focus on the most lucrative audience members. Google also took use of the real-time campaign optimization option, recycling campaign data to better its approach.

Believe me, programmatic advertising actually worked for Google helped in the following things:

– Brand awareness has increased by 50%.

– Three times as many people were reached by 30 percent more individuals.

– CPM is 30% lower this year than the previous year.

Adopt early. Google experimented with programmatic marketing in 2014. Don’t wait to give programmatic advertising a try. Experiment now and get ahead of competitors that haven’t even considered programmatic ads as an option.

The Economist

The Economist also tried this way of marketing and hoped for getting better results and made their readers curious about their newspaper.

The corporation wanted to personalize its adverts to its readership because “The Economist” covers a wide variety of issues, from finance to technology.

The magazine studied their enormous viewership statistics in response.

This information includes how subscribers engaged with the newspaper on the web and through the mobile app. “The Economist” used their statistics to figure out what material drew readers in and when.

From these portions, “The Economist” created lookalike audiences.

Each of these target segments got advertising that was specifically customized to their interests. An ad featuring one of the publication’s latest (or most popular) finance pieces, for example, might be seen by someone interested in finance.

“The Economist” generated over 60 different ad versions in all, with the following results:

– 6,000,000 distinct acts

– 1 million unique visitors to the website

– There are 650,000 fresh prospects.

– Ad income of $650,000

– 9500 new customers, worth a total of $15 million during their lifespan

– Audiences in the United States have increased their “awareness” by 64%.

– Audiences in the United States have increased their “consideration” by 22%.

– In the United States, viewers’ “willingness to suggest” has increased by 10%.

– Return on investment for a campaign of ten to one

That’s how these two brands became the best examples of programmatic advertising. Also, they showed us how they used the advertising strategy.

Conclusion

Programmatic advertising is becoming a great strategy as a lot of business owners are spending about $60 billion every year and believe me they are generating high revenue through it.

Not only the small brands but some of the biggest brands like Google, and The Economist are also using this advertising tactic. So, why don’t you?

You can also use this, you just need to understand the whole process of advertising which I have already explained above.

If you have any doubts or queries, you can just comment down below and I am going to respond for sure!

For more marketing tips and services, you can schedule a free-of-cost 30-Minute Strategy session with our experts. In this call, our experts would discuss your business and provide you with the free strategies that you can use to boost your sales and revenue.

FAQs

1. What is an average Cost-Per-Click for programmatic native/display advertising?

On the search network, the average cost of a Google Ads (AdWords) advertisement is $2.32 per click. On the Display Network, the average cost per click for an ad is less than $0.58.

2. Is Google AdWords a programmatic ad network?

In many aspects, the Google Display Network is akin to programmatic advertising. Both systems employ display advertising to reach a specified audience and are auction-based.

3. What are the benefits of using programmatic advertising tools?

Marketers and advertisers may use a programmatic advertising platform to automate the buying and administration of their digital ad campaigns. Media purchasing, ad placement, performance tracking, and campaign optimization are all part of this process. Many platforms also have a tool for creating campaign creatives.

4. What is a programmable platform, and how does it work?

Advertisers and marketers may use programmatic advertising systems to automate the tasks involved in creating a successful digital ad campaign.

5. What is the definition of a programmed trader?

A programmatic trader is in charge of managing advertising campaigns across several DSPs (Demand-Side Platforms), such as Display and Video 360. It needs a unique combination of creative and analytical talents to show the correct message at the right moment to the right individuals.