A Marketer’s Guide to Programmatic Advertising
Even with an unlimited budget and a savvy marketing team, getting your ads in front of the right audience can be a challenge. Fortunately, programmatic advertising enables brands to deliver and scale targeted advertisements to maximize performance.
As marketing has shifted to digital platforms, programmatic ads have gained increasing popularity in the ad tech industry. In fact, eMarketer data found that programmatic display ad spending increased 41.2% between 2020 and 2021.
Understanding programmatic advertising is a crucial component in optimizing your digital marketing strategy. Let’s talk about what it is, how it works and where you can run programmatic ads.
What is programmatic advertising?
Programmatic advertising refers to automated media buying, in which online advertising space is bought and sold through an automated bidding system. While advertising transactions have traditionally been conducted through manual systems like request for proposal (RFPs) and insertion orders, programmatic advertising streamlines the process to cut down on the amount of human involvement.
However, like other forms of advertising technology, programmatic advertising can’t replace people completely. Rather, many companies use programmatic systems to handle the day-to-day logistics of their digital ad campaigns. Meanwhile, this frees up their digital media specialists to handle more long-term strategic projects.
What does programmatic advertising look like?
One of the most mainstream forms of programmatic ad buying is the Google Display Network. Through this system, website publishers can sign up to display advertisements on their pages through Google AdSense. Then, advertisers join the network to bid on whose ad will be displayed in the allocated space every time a visitor views the page.
How does programmatic advertising work?
As we mentioned earlier, programmatic advertising is the general concept of buying and selling ad space using automated technology rather than manual processes. However, the flow will look different depending on which type of programmatic advertising you use.
Real-time bidding
Real-time bidding (RTB) is the most popular method in the programmatic ecosystem. In this system, advertisers will join an ad network that gives them access to ad space across a range of locations. From there, they can bid on individual impressions in order to target specific audiences.
For example, let’s say a visitor clicks on a webpage. The domain owner will put the impression up for auction. Advertisers in the ad network will bid on the impression based on data like demographic information, user location and website content. Whoever bids the highest will win, and their ad will be displayed on the website.
Real-time bidding may be conducted on an open exchange or a private marketplace (PMP). While an open exchange allows all buyers access to inventory, a private marketplace is invitation-only and available only to a select group of buyers.
Programmatic direct
Whereas real-time bidding allows advertisers to reach viewers across a range of publisher websites, programmatic direct facilitates ad campaigns between an advertiser and a specific publisher. Rather than bidding on specific impressions, the two parties will define parameters including ad placement, number of impressions, campaign duration and cost per thousand (CPM).
While programmatic direct advertising involves less targeting than RTB, it allows both advertisers and publishers more control over the transaction. Both parties can also secure their reputations by ensuring that their brands are compatible before running the campaign.
How to execute a programmatic campaign
To make the most out of programmatic technology, it’s important to understand all of the tools involved in the process, especially for advertisers running their operations in-house. Let’s talk about the programmatic advertising platforms available to optimize the marketing experience for advertisers and publishers alike.
Demand-side platform
A demand-side platform (DSP) streamlines the programmatic media buying process for advertisers. It helps them optimize their programmatic marketing campaigns through enhanced targeting, strategy and real-time performance data. DSPs also make it easier to scale your campaign by connecting to multiple ad exchanges to expand your options. Some will also enact measures to fight ad fraud, reducing waste and increasing your campaign’s ROI.
By using a DSP, advertisers can improve their campaigns without executing complex plans on their own. Instead, they can often specify their parameters, including a budget, time period and a campaign goal. Based on those specifications, the DSP will enact a bidding strategy using artificial intelligence and advanced machine learning algorithms.
For instance, if your goal is to build awareness, your platform will seek to maximize your number of ad impressions. Contrastingly, if you said that you wanted to increase conversions, it might focus on getting your ad in front of high-intent viewers.
Supply-side platform
A supply-side platform (SSP) also improves the ad buying experience, but from the publisher side. Through an SSP, publishers can automatically connect their ad inventory to a range of ad networks in order to reach more advertisers.
Data management platform
A data management platform (DMP) delivers third-party data to your DSP. This enables the DSP to more accurately estimate the value of an impression and make informed purchasing decisions.
Ad network
An ad network is a programmatic marketplace that facilitates the sale of advertising space by bringing together advertisers and publishers. While DSPs and SSPs may connect to ad networks to streamline the process, marketers can also use them directly.
Popular examples of ad networks include Google Ads and Affied, both of which allow publishers to monetize traffic by selling targeted impressions. At Affied, we also host an ad network to enable advertisers to run programmatic native ads within email newsletters.
Top programmatic advertising channels for marketers
One of the major benefits of programmatic advertising is that it’s compatible with nearly any type of digital advertising. For that reason, you’ll be able to incorporate it through several areas of your marketing strategy.
Email advertising
As previously mentioned, advertisers can run programmatic email ads through the Affied Ad Network. Through our easy-to-use platform, advertisers can run a single native ad across several newsletters to reach individual subscribers. To capture your target audience, you can specify parameters including:
- Location
- Job title
- Industry
- Gender
- Interests
Additionally, you’ll be able to set frequency caps to limit oversaturation and guarantee that your ad is reaching new audiences.
Social media
Many marketers are already familiar with programmatic social media advertising. In fact, automation dominates most social media marketing strategies, from Snapchat to TikTok ads.
Many apps and platforms also allow advertisers to run programmatic ads across a variety of formats. Instagram alone offers a wide range of options, from shopping and carousel ads to IGTV and video ads. By offering a variety of choices, these platforms allow marketers to target their audience at an increasingly granular level.
Native advertising
While it’s not quite as common, native advertising is an extremely effective form of programmatic media buying. This advanced advertising strategy involves online ads that appear within organic content. For instance, it may include in-article ads, sponsored content or promoted listings. By running programmatic native ads, you can scale your campaign while effectively capturing your audience’s attention.
Display advertising
Display advertising is one of the most popular types of programmatic advertising because it’s easy to copy/paste across a number of platforms. Display ads include any placements in the header, footer or sidebar of a screen. While we typically don’t recommend display ads due to their increased risk of ad blindness, they can be a good fit for more visual content.
Learn more about improving your advertising strategy
Getting started with programmatic advertising may seem daunting, but many marketers find that it’s well worth the investment. If you’re ready to dive in, check out Affied Ad Network to start scaling your newsletter campaign.