The future of Advertising: Programmatic Advertising

Programatic Advertising

What is programmatic advertising?

The conventional advertising model is not sufficient, expensive, and time-consuming. The biggest challenge in offline advertising is the lack of a proper approach to find the Return of Investment(ROI). Programmatic advertising uses Machine learning and Artificial intelligence to buy advertising in real-time, instead of going through human negotiations. It uses datasets that decide the target audience, and ads are chosen based on consumption; these ads are retargeted from time to time to increase ROI.

Let us look at some of the channels for Programmatic Advertisements.

  • Display ads: The term ‘display ads’ is generally used to refer to any online visual ads, but in programmatic ads, the ads shown only in the footer, header, or sidebar are considered display ads.
  • Video Ads: The recognition of programmatic ads is continuously growing, as videos continue to become the most preferred channel of content consumption. Digital video ad expenditure in the US solely is expected to go up to $22.18 billion in 2021.
  • Social ads: Social media is a great platform to collect massive data from users to boost their targeting capabilities. Programmatic advertisements utilize this data to analyze their ads’ target population. It also helps them understand the type, format, suitable time, and frequency of the ads, which allows the advertisers to optimize their ad expenditure.
  • Audio Ads: Unlike popular podcasts that follow the traditional sponsorship model to place ads, programmatic audio can boost up the efforts for revenue generation. Programmatic audio platforms target current audience data to display ads and use engaging video ads and display to improve the user experience.
  • Native ads: Native ads stick to the feel and form of the medium they are being set out. In programmatic native advertising, publishers use an SSP to sell their ads. Advertisers collaborate with a DSP to pick the impressions to purchase and their cost. According to research by IPG and Sharethrough on native ads, users look at 53% at native ads more frequently than display ads.
  • Digital out-of-home: It is an analytically superior and digital evolution of the common out of home advertising. The traditional digital out of home sales consists of the advertisers manually selecting the audience, pricing, targeting, screen selection by collaborating with the network.

Advantages of Programmatic Advertising:

Apart from the efficiency brought in by decreasing the need for human involvement and AI-driven algorithms, the following are five merits of using programmatic advertising.
  • Visibility: Unlike traditional advertising that takes a lot of time to get outcomes of advertising campaigns and lack of means to understand the extent of their accuracy, programmatic advertising gives accurate information of their ad campaigns’ performance, which helps the advertisers to accumulate more data about the target audience.
  • Enhanced Capabilities: There are two methods to connect with a brand’s target audience. The primary approach would be to combine first and third-party data to improve the audience’s profile and assist them with accuracy. The secondary approach applies to contextual programmatic advertising. Contextual advertising derives data from the user and the page content, to place ads at the most appropriate location. For example, a brand would be able to serve advertisements of CRM applications to a salesperson or marketer on a business publication. Besides these strategies, advertisers can use geo-targeting, data, remarketing and IP address targeting and app or website targeting to acquire a more clear approach towards targeting. These enhanced capabilities give plenty of room to the advertisers to customize their ads.
  • Transparency: As the advertisers know about the ad inventory they are buying and the target audience, they can track their ads’ performance, understand their expenses or the budget, and modify their campaigns to get the targeted results. Also, the risk of errors is reduced due to lack of human dependence.
  • Cost-efficient: Programmatic advertising issues advertisers a real time campaign performance which can help them invest their budget in the approaches that will give them good results. A right investment plan would help the advertisers spend their budget effectively and give them a better ROI.
  • Deal effectively with Ad frauds: Unethical ad practices attract the digital advertising industry. Publishers, for a long time, have been deceiving advertisers by carrying out various fraudulent plans. Programmatic advertising platforms offer transparency to the advertisers that enable them to evaluate their ads’ performance and pick the ones that deliver better results.Major programmatic ad platforms also deal with ad fraud by stopping pre-roll ads and fake bot traffic and providing ad credits if there is a forged tactic slip through their system.

There are numerous reasons for considering programmatic advertising, which makes it the future of advertising. This information on programmatic advertising has covered the required knowledge to explore its process and make its use.