What is Programmatic Advertising?

Programmatic and display advertising is probably a term you have heard before but, like many, unsure what it is. or know a bit or two. In the world of advertising and the need to actually spend money to make money, programmatic advertising is an essential part of the process. In this article, we are going to show you exactly what it is and explain the concept and process.

programmatic advertising

Programmatic Advertising in a Nutshell

Programmatic advertising is about using software to purchase advertising on your behalf. In a nutshell, it is about machines buying ads.

Is that it?

It’s a tad more complex than that, but this is the fundamental principle. Programmatic advertising does not just seek out new advertising opportunities. It goes through the negotiation and payment process for you. It can take some setting up, and you do need to install careful parameters, but after that you can sit back and relax while the software does the job for you.

Why Does It Matter?

Yes, efficiency and targeting.

It is that simple. Manually, it takes a long time to seek out digital ads, apply for them, wait for a response, and then begin the negotiation process. Furthermore, humans are prone to error. The software isn’t (hic!). Remember that digital ad sellers are also using software to automate the process on their behalf.

Humans are prone to paying too much for ads. Purchasing the wrong ads. And spending too long on trying to get ads.

The primary benefits of programmatic advertising are:

  • Making ads more affordable
  • Increasing the efficiency of the ad buying process
  • Purchasing ads when you cannot. The software will operate when you’re sick, sleeping, or busy with another project.
  • Targeting

The Concept of Becoming Robotic

People are rightly concerned about the continued automation of business processes. Some critics say that increasing our reliance on robots is throwing humans out of the process. While it is true that in this case technology is replacing humans, robots can only do so much.

Technology is about removing the menial, time-consuming tasks humans have to deal with on a daily basis. For example, technology has automated the processes of submitting insertion orders, inserting tags, and other similar tasks.

Humans still have to set parameters, and they still have to tell the software what to do. Planning is still down to us, but the bureaucracy isn’t.

Any business that wants to increase the amount of spare time it has would be foolish not to consider using technology to automate some of its advertising tasks.

Is this Real-Time Bidding (RTB)?

Programmatic buying is not a fancy word for real-time bidding. Real-time bidding is a type of programmatic ad buying, though. Programmatic advertising is the parent of real-time bidding.

Here’s a simple, good (and a bit long) explanation of the whole concept:

https://youtube.com/watch?v=xnX1nxMM_R0%3F

Real-time bidding is simply the act of purchasing advertising in an auction house environment. Programmatic software is a way to guarantee ads in advance. In other words, there are no guarantees with real-time bidding, but programmatic buying does provide a guarantee.

Even though you can automate both processes, they are different.

Does this Represent the Future of Online Marketing?

While it is far too early to tell, there are strong signs that this (some say it is) will be the future of advertising. The problem is that it’s impossible to determine how many companies are using automation software and how many companies are not. But we don’t know that it’s starting to rise. Some agencies are mass buying advertising through these channels, and some massive brands have even taken to setting up whole departments for programmatic ad buying.

For now, this is almost exclusively the domain of online ads. We will likely see marketing brands explore the idea of buying traditional media segments for radio and TV in the near future, though. Currently, certain TV and Movie companies are using this technology for product placement.

Conclusion

Programmatic ad buying is well worth exploring if you are a company investing heavily in online advertising – although it depends on your sector, contact us for advice if unsure. It will take a previously time-consuming process to streamline it. Take note, you will have to continually monitor it, but it should only take a few minutes a few times a day to make sure it is running as it should.

You do not need a dedicated department, as is the case with some larger companies.

Once you get it up and running, you will have much more time to dedicate to more important tasks like product research, testing, and customer research, and, actually doing what you do.