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What is Programmatic Advertising?


The term programmatic advertising, as a broad definition, refers to the buying of ad space through automated technology. More specifically, to an ad exchanger that works in real time to place a series bids in a matter of milliseconds. This process is aptly named Real-Time Bidding. Programmatic advertising encompasses a wide range of tactics, and not only display. There are now video options, such as: in-stream/pre-roll, ads that run before a YouTube video; outstream, videos displayed when scrolling through an article; in-display, videos that run in positions generally dedicated for display ad sizes only; and Connected TV.

Before programmatic advertising, marketing teams would be required to spend a significant amount of time comparing individual companies to see if their audience aligns with the brand’s target audience. While traditional advertising still has its own benefits, adding another layer of broad range advertising like programmatic can have a huge return on investment.

The Marketing Rule of 7 states that a potential client or customer needs to see or hear a brand’s message an average of seven times before considering taking action. If you’re only advertising through a single publisher, you’re limited to how many times a client or customer is going to hear your message. Traditionally, that would require direct advertising with multiple publishers, which is not only costly, but also time consuming. Programmatic offers a fairly simple solution - set a budget and an audience and the system will find your audience at your price point across a vast inventory of sites that have opened themselves up for bidding. So even though a particular site may not be on par with your target audience, someone in your audience can still see your message whenever they browse the internet.

Although programmatic is a feat of modern technology, it has its idiosyncrasies. For most small businesses trying to manage their own advertising, many of the buying platforms are straightforward enough that you should be able to spend minimal time on setup for a basic display campaign, focusing mostly on the fundamental targeting settings - geo, day/time parting - and demographics like age and gender, if that’s applicable to your business. These are great options for businesses that are already somewhat established and just want consistent advertising. Keep in mind that while the bidding is automated, it’s not a good idea to set it and forget it. 

Newer businesses, or businesses that are working mainly on expansion, will probably want to start a conversation with an ad agency soon after, or even before, starting a basic display programmatic campaign. Running Programmatic through an ad agency will make managing ad campaigns so much simpler for a variety of reasons. First and foremost, the amount of data you get back in reporting can be overwhelming and hard to sort through, which can cause a lot of confusion if you’re struggling to understand your audience. When you have an agency who is well-versed in sorting and translating this data, you’ll be able to employ more technical tactics, such as hyperlocal or contextual targeting. A good ad agency will also supply recommendations based on where or how you’re receiving interactions. Most agencies have best practice recommendations, such as how often to refresh creatives, tips on what kind of creative content is the most engaging, and whether you’re oversaturating a specific market, which can be just as detrimental as not advertising at all. The biggest pro to employing an ad agency is that it can save you money over time by increasing the value of each individual interaction or impression. Keep in mind, more impressions does not necessarily equal more conversions.

Whatever your need, from client retention to brand awareness, programmatic advertising can be an invaluable player in your advertising lineup.

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