The majority of digital ad space is bought and sold by programmatic means these days. Programmatic media has expanded rapidly in the last few years. Experts predict that it will continue to grow as well.
Why has programmatic advertising become so popular? It’s the best way to handle advertising online. If you haven’t switched your advertising strategy to programmatic yet, you’ll want to consider it.
This guide will break down what programmatic media is and how it works. From there, it’s easier to understand the benefits a programmatic strategy has from your business.
Understanding How Programmatic Media Buying Works
In the past, people bought ad space manually. That means media buyers would get in touch with the publisher and negotiate a purchase.
This model worked pretty well for newspapers and other traditional media. You’d call up the TV station you wanted to run your ad on and buy a block of ad space. They’d send over a contract, you’d send them the ad, and they’d run it.
If you wanted to run an ad on a billboard for a month, you’d call up the company that managed the billboard you wanted. If you wanted to run your ad in the next edition of The New York Times, you’d do the same thing.
When Internet advertising first got started, this was largely the model used. You’d get in touch with the webmaster of each individual site and negotiate an ad buy. You might agree to run ads for so many days or weeks.
As the Internet and digital marketing have grown up, though, this model stopped working. It’s a pain to need to contact every individual webmaster on each site you want to place ads. Publishers also found it more convenient to team up with platforms like Google Ads to offer ad space.
The demands of Internet users also changed the way ad-buying happens. People want websites to load in less than two seconds. You can’t do that if you’re using human decision-makers to negotiate each ad space as it becomes available.
Instead, you’d have to buy ad spaces in advance. That means you won’t know if the user is a good fit for your ad or not. This leads to wasted ad budgets and poor campaign performance.
Switching to Programmatic Ads
Programmatic media takes the human decision-maker out of individual ad-buying transactions. Instead, your media buying team sets up a campaign within an automated system.
The system uses the information you give it to analyze ad spaces as they become available. The system compares the information about the user session to your “ideal” ad viewer. It then enters a bid on the ad space.
This process happens in mere nanoseconds. That’s much faster than a human could ever make a decision. What’s more is that the system often makes better buying decisions.
So, the demands of Internet users for faster speeds and advertisers’ desire to make good ad space buys have pushed the need for programmatic media buying.
What Does Programmatic Media Buying Offer?
Speed is clearly one of the benefits offered by programmatic media buying. With programmatic media buying, your team can make better media-buying decisions in mere seconds.
There’s also the benefit of freeing up your team’s time. You don’t need media buyers negotiating with individual salespeople.
This can also help you save money. Maybe your team can be a little bit smaller. Maybe they can put more of their efforts into revenue-generating activities.
The biggest benefit of programmatic media buying, though, is that it’s smarter. The automated system is faster, but it also makes better buying decisions.
How so? The use of AI lets the system compare the user session data to your ideal campaign viewer. The better the match, the more the AI will bid to make sure you get that space. If the space isn’t a good match, the system will skip it.
That means your budget is spent on placements that are the most likely to convert. Your return on investment will be much higher, and you may even see your profits rising. In addition, you may be able to trim your ad budget.
At the very least, you’ll be able to spend the budget you do have in a smarter way.
Compare that to old models where you had to buy ad space in advance, without knowing the user on the other end. Programmatic ads result in much better placement and performance.
Discovering Your Audience
Programmatic media buying works thanks to data. Data is what allows the system to determine which ad spaces are good for your business and which ones aren’t so great.
User data, along with information about the content they’re viewing, informs ad-buying behavior. Many publisher platforms can tell you quite a bit about the user. You might get insight into their geographic location and their Internet browsing history.
Suppose a user lands on a site about running. When this happens, you’ll be able to see that they’re in your local area. The data shows they’ve also recently been reading up on how to run a 5k and what the best shoes are.
If you sell running shoes, this person is a great prospect.
Now suppose the user is a video game aficionado. Their session history includes looking at games, the latest Xbox news, and Twitch. They may not be the best target for your ad.
Just as this data powers better-buying decisions in the moment, it can also help you make adjustments to your campaign. Over time, the AI learns from the data collected. It discovers what placements perform the best for you.
It can then adjust its bidding strategy to make sure you get in front of users who are more likely to click on the ad or buy.
This data can also help your team. You can look at long-term trends and discover who is actually interacting with your ads. In turn, you can use that data to inform your strategy.
Know Who Is Actually Buying
Many marketers believe they know who is buying their product or who they want to reach. The data collected by programmatic systems can confirm this.
The data can also show you audiences you may not have been aware of. Maybe you thought your product appealed to older men, but it’s actually very popular with younger men too.
There may also be differences in people’s interests. You may have designed your running shoes for older folks who are training for a marathon. The shoes may also appeal to shoe collectors and fashionistas.
When you see these trends emerging in your data, you can start building campaigns to reach each of these unique groups.
Discover Why Others Aren’t Buying
Your data may also be able to show you trends in who interacts but doesn’t convert. You may be able to identify that there’s a certain group that seems interested.
You may be able to reach out to this group and get their insights on why they’re not buying. You can also test different offers with them. You may even try different ads to see what resonates.
You may be able to create campaigns that address pain points for customers.
Move Beyond One Platform
Once you’ve gained more insights into your audience, you can look to see where else you might reach those groups.
If you discover that a lot of your audience is young men, then you may want to expand beyond running websites. If your shoe brand attracts fashionistas, then maybe you should be buying ad space on Instagram or fashion websites.
This is another way switching to programmatic media buying can save your team time. You can centralize your media buying in one place, accessing many different websites and platforms.
This allows you to create more comprehensive campaigns. You don’t need to have one member of the team looking after every website or social media platform you want to use. You can access platforms like Spotify or even get in on OTT advertising opportunities.
It can also help you expand the type of placements you use. Banner ads are common, but more digital ad spaces are devoted to audio and video than ever before. Using all three of them will help you expand your reach across platforms and audiences.
It may even help you move users through the funnel. First, someone sees a banner ad on a running website. Later, they see a video crop up in their Facebook feed. Finally, when they search your brand, your ad pops up in the Google search results.
They click it, and they buy a pair of your shoes.
How to Use Programmatic Ads
If you’re already using Facebook Ads or Google Ads, you’re using a type of programmatic advertising. Generally speaking, programmatic media buying strategies move beyond a single platform.
To get started with a programmatic strategy, you’ll need to invest in a demand-side platform or DSP. This is the AI that powers your media buying.
There are many DSPs out there, and some of them can be quite pricey. If you’re not sure you can afford to invest in a DSP, then it might make sense to talk to an agency. They’ve invested in DSPs to serve their clients, and they may be able to make access to the DSP more affordable.
They can also help by giving you access to more than one DSP. Their expertise will let them choose the right platform for your business. That may change from campaign to campaign, so when you work with an agency, you’re not stuck with one DSP.
Designing Smarter Campaigns
The next step is to design smarter campaigns. The DSP works by comparing your ideal customer to the various ad spaces.
Knowing your customers well can help you reach the right people and buy the right ad space. You should also create goals for your campaigns.
In addition to that, you’ll want to take a look at your campaign content. Using the right images, keywords, and copy can make banner ads more compelling. If you’re using audio or video, then you’ll want to optimize them for performance.
Use Metrics to Measure and Tweak
Once you’ve set up your campaign, you can begin to collect data from it. Choose the metrics you want to measure. Then use the insights you gather to tweak the campaign for better performance.
You may find sifting through so much data a bit intimidating. An agency can help you here too. Their team can help pull the most relevant metrics and crunch the numbers.
You can also use data to give more insight into structuring not just individual ads but also overarching campaigns. In turn, your strategy can become more comprehensive.
Combine Programmatic Ads with Other Marketing
You should use programmatic media buying as part of your overall marketing strategy. Combine them with ads on TV or in print or with a social media campaign. Content marketing and other strategies can all work together with your programmatic marketing efforts.
A Better Bottom Line for Your Business
With all these advantages, it’s easy to see how programmatic media buying could contribute to your bottom line. It can rein in ad budgets, helping you spend smarter.
It also saves your team time, which can reduce overheads. In turn, they can put more effort into data analysis and crafting campaigns that make people want to click.
All this combines to make programmatic advertising more effective. Your rationalized budget helps you spend less on the best ad spots. Those spots are more likely to convert, leading to higher brand awareness and sales.
The impact on your bottom line is two-fold. You’ll see higher revenue from increased sales, and you’ll be able to tame budget costs.
Start Using Programmatic Now
With all this in mind, it’s easy to see why programmatic media buying is simply the best way to advertise. You’ll get more for every dollar, with less effort and better outcomes. It really is smarter marketing.
Are you ready to make the switch to programmatic advertising for your business? It’s time to get in touch with an agency that knows programmatic inside out. Our expertise can help you start running successful campaigns in no time at all.
