Programmatic Advertising: What It Is & Why You Should Be Using It

If you are not using programmatic advertising in your business you are probably missing out. Some business owners aren’t using it becasue they don’t know what it is or why they should care so we will take a look at it in this article.

What is Programmatic Advertising?

First, we have to understand what programmatic advertising is.

Programmatic advertising is the use of algorithms and auction software to bid on advertising space that best suits your audience and budget requirements. Google AdWords is a type of programmatic software, however, we’re going to look at programmatic advertising that covers display and video advertising.

The Advantages of Using Programmatic

The reason programmatic is being so widely adopted is due to its efficiency savings. Display advertising was originally quite a laborious task as you had to find websites that would allow you to place advertisements on their site and then negotiate a price based upon impressions (views) or clicks (engagement).

A concept image of Programmatic Advertising

Once the negotiations were done, you would have to provide the banner, often not designed in the format you already had it. Following this, you had to manually check that the advert was up and running every week and that it was performing as you expected.

If you had a 1,000 websites to do this across, it meant a lot of time was spent nannying the adverts and moaning at site owners or managers when something went wrong or they moved your advert to a different page outside of your agreement.

It was also much harder to deliver the advert in time windows and only to users from certain areas or countries. As a result, display advertising was an inefficient use of an advertiser’s time and to get good results was a lot harder.

Then programmatic software started to be introduced by companies like Marin, Sizemek and Adbeat to name a few. There are many reasons why companies have adopted programmatic more and more.

1. Time

Time is the first factor.

Suddenly, using publishing networks with programmatic advertising was incredibly fast because you had software that could find ad space that met your audience and budget requirements.

This meant no more trawling through the internet or asking the SEO team if they knew of any relevant sites that might be within budget.

The software did it all for you as it knew all of this information already. More time means more hours in the day for your display team to optimise those existing ads. Delivering them at the right time and to the right audience resulted in the best click-through rates.

2. Budget

A budget concept image

Budget is the other major reason you should be using programmatic advertising. You want your investment to achieve the best return it can in an auction based marketplace.

The programmatic software helps to cut away the fat and leave you with much better quality ad space for your budget.

Instead of wasting large sums on a few sites that might not work, you are directing your ad to your relevant audience only.

Better sites give better ROIs and help you achieve your KPIs. Combine this with the time savings your display team have, the value of your budget becomes higher as the team can optimise the adverts further and drive even better returns.

3. Targeting

Better targeting is the final piece in the jigsaw of programmatic advertising.

The more accurate your targeting is, the better your engagement will be and the increased ROI you will have.

There’s no point in delivering ads to people at the wrong time of day, during the wrong time of year, to the wrong demographic or at the wrong location.

This is particularly true for sites that have multiple user audiences. An example could be an online newspaper or magazine, the content varies drastically and therefore, the audience does too.

If the newspaper is read internationally this makes the audience even broader. Do you want to be delivering ads at 3am to British consumers when your audience is fast asleep and the people on the site are in Australia reading the paper on the way home from work? Targeting stops these problems from happening and programmatic advertising is the best way to do this.

With programmatic advertising predicted to make up 80% of the display advertising market it certainly says that advertisers and publishers have backed the technology as it is proven its worth.

However, that’s not to say the old system of finding sites to advertise on isn’t still useful. Nothing will ever replace human intuition, at least not yet, on whether a particular site is worth advertising on.

The traditional method is also good for raising brand awareness because you often want to target multiple audiences, especially if you sell multiple products or services. The trick is to find the right balance between traditional and programmatic.

Whilst allowing programmatic to give advertisers all that extra time and extra budget to go and find those high quality sites that it might not have found itself using the algorithms but which an experienced display advertiser knows will work.

If you need advice from a specialist programmatic advertising agency please get in touch or call +44(0)208 977 2994.