What You Need to Know About Programmatic Advertising
Tom Armitage
Things change in the marketing world so quickly, especially lately. It’s amazing how something as new and functional as remarketing is now considered dated by some new school advertisers. Meanwhile, programmatic advertising is still a bright, shiny, relatively new object in the marketplace. Depending on how the program is built, it can be extremely functional for both B2B or B2C brands. Various industries can find value in these dynamic, cross-platform ad groups.
A Brief History of Online Advertising
Let’s look briefly at a history of online advertising before we discuss something as complex as programmatic ad buying. It’s important to know where we came from before we look to where we’re going.
1990s: Banners ads, pop-ups and pop-unders.
These were the early days. Banner ads were jammed into a variety of areas on popular websites. They were bright, flashy and most were just plain ugly. Pop-ups appeared over our browsers, causing us all to X out as soon as we could. Pop-unders appeared behind the browser and you only saw it when you closed out your session at the end of the night (or when someone needed to use the phone). All of these types of ads were intrusive and were a major reason for the rise of social media that made way for the personalized experiences we enjoy today.
2000s: Search all the way, baby!
As Google began to pick up speed, the best place to get in front of potential customers was in a Google search. Unlike the free, organic listings, placement in the ad areas (top, right column and bottom) could be controlled with good copywriting and big dollars. It was a “pay for play” game and the popularity (and effectiveness) of this service is truly what helped Google became the profitable giant that it is today. Search ads can still be helpful for many business types.
2010s: Two major developments occurred in this time period.
The first was social media advertising. As channels like Facebook, LinkedIn and Twitter found their footing, and the ad platforms became extremely user-friendly, businesses both large and small began to take advantage. It was a great way to showcase visual products and get in front of extremely niche audiences – the most impressive thing about social media, really. Additionally, remarketing, or serving ads to those who have visited your website previously through the use of cookies, also gained traction.
What is Programmatic Ad Buying
There are 3.5 billion users on the internet. That’s a lot of people at your disposal to get in front of. And unlike billboards or TV, it’s quite possible that, with the right budget, you could get in front of a good portion of those users. Programmatic ads let you be more cost-effective in reaching the customers that are important to you. According to MarketingProfs, 62% of marketers use programmatic ads, while the spend among this type of advertising is growing 20% annually.
What makes programming advertising different though is the real-time, automated bidding process that’s associated with these programs across connected web networks. At its very core, it’s more of a technological upgrade. But when marketers use the term, they typically refer to the ability to place ads much more strategically. Here’s what I mean:
- More precise targeting: IP targeting, geo-location, contextual targeting (see more info below).
- Omnichannel approach: We know users may need multiple touches before they buy. It’s important to engage and re-engage with users over time, and across platforms for a comprehensive learning and buying experience.
- Cost: Potential savings since there’s less labor needed to manage.
How to Build a Programmatic Program
The three important things to focus on when building a programmatic ad program is: Right Time, Right Person, Right Message.
Although image-based display ads are still the most common, don’t feel limited by programmatic advertising. Consider audio and video too because we’ll soon see much more integration with voice-powered devices, streaming audio channels, and streaming video platforms since profiles and location deliver important intelligence to the advertising systems.
Once you’ve committed to this type of ad progress, follow the following steps to get started.
1. Get your resources ready.
First, you need to have resources ready to devote to this effort. This includes the out-of-pocket cost for the ads themselves, typically a CPM or CPC model, as well as fees for the creative work and management of the program. These can be in-house resources, through a marketing agency, or sometimes the programmatic ad networks offer services directly.
2. Select which programmatic ad service you’d like to go through.
Some popular names in the industry include Google Ads, Amazon AAP, Townsquare Media, One by AOL, Rocket Fuel. If you work with an ad agency, they likely already have partnerships with certain distribution channels and you won’t need to worry about the actual technology behind the operation. You’ll be responsible for working with your partner on the goals, landing pages, and the type of customers you want to target.
3. Establish your targeting
Besides real-time bidding and less hands-on management, one of the most impactful benefits to programmatic ads is the ability to target. Here are a few of your options that you’ll want to consider when building a program with your partner:
- Keywords: Perform research and figure out the most relevant, most used keywords by your target audience. This will help your ads be placed on the right sites.
- IP: Businesses that are large enough have dedicated IPs. In other words, if you’re tracking, it won’t be read as a shared network – like Time Warner Cable or Verizon. Instead, it would actually be recorded as Pepsico or Sony. In doing so, you can deliver targeted ads based on that known IP and do account-based marketing.
- Location: Targeting by location is incredibly useful, especially for local or regional sellers. But programmatic advertising can take it one step further. You can select niche locations – let’s say a perimeter around a large venue where a relevant trade show takes place. Ads can then be served up during the show or users can be cookied and later served with ads once they return home.
- Wifi/Cross-device: Once you’ve registered a user in your ad system, you can also deliver ads to other devices on that person’s WiFi account. This might be more valuable to B2C companies, but the technology is fascinating nonetheless. Let’s say an accountant is at work downtown and he sees an ad for a local restaurant. He doesn’t have time to go to lunch, so he ignores the ad. When he gets home, his wife, who’s connected on her iPad, may now see an ad for that same restaurant. The wife, typically the decision maker when it comes to family meals, could now choose to go to that restaurant which originated from the ad from earlier in the day.
- Contextual: Some advertisers choose where they want their ads to be placed based on the main themes of available websites. If Supply Chain Management Review, for instance, focuses mostly on supply chain and procurement, you might choose a site like this to advertise if your product makes sense for this vertical. But with contextual targeting, the system doesn’t look at the site as a whole but rather the content of the articles within. So you might have an article on FoxNews that happens to discuss procurement trends. Your ad would appear within or alongside that article. Readers are naturally interested in the content they are reading, so the ad feels much more native and natural – rather than disruptive – and acts as complementary to the piece.
- Remarketing: All of those that you capture from your programmatic ad campaigns – whether via location, device, IP, or website visit – can later be served with highly-tailored remarketing ads. These work well for brands that have long sales cycles and need to have continual re-engagement or nurturing over time.
4. Establish your budget
Like other online advertising programs, programmatic advertising is a CPM (cost per thousand impressions) or CPC (cost per click) model. So you can control how much you’re willing to spend based on your budget and/or based on anticipated results. Depending on your brand and its product/service, this could be an awareness campaign so ask your agency what type of budget you’d need to see an impact.
5. Prepare your creative
With any online ads, you need to pair your copy with creative. Creative can come in the form of several multimedia formats. The most dominant formats include image, audio, and video. You’ll want your creative to meet certain guidelines (dimension, file format, etc) and also be creative to stand out from the crowd. Most importantly, the creative should complement your copy and messaging and should be deliberately based on your advertising strategy.
6. Launch and monitor
It’s time to go live with your campaign. Don’t fret, you can always make real-time changes to copy and creative throughout the length of the program. Like most digital assets, it’s a living breathing thing. You’ll want to be constantly monitoring your progress and adjusting your ads to see improvements throughout the length of the spend.
7. Measure
If you have a digital marketing program and don’t plan on measuring, then don’t even bother. Measurement is the only thing that can guarantee whether efforts were worthwhile. Here are the metrics you’ll want to track throughout the length of your program:
- Reach, impressions or views (number of people, or total views of your assets)
- Engagements (interactions)
- Clicks (click-throughs to your website or landing page)
- Conversions (people that took that action you wanted them to take)
- Relevancy or quality score, if provided (how relevant and how high of quality the ads are)
- Total cost (out of pocket spend for the program)
- Cost per impression or view
- Cost per engagements
- Cost per click
- Cost per conversion
- Closed deals (tag accordingly so you know which deals came from this advertising)
- Cost per acquisition (total spend – both out of pocket and management and creative fees against the number of closed deals)
Make sure to measure regularly (weekly, monthly, quarterly) and change your targeting elements, creative or placements, as needed, to continually improve your program.
