What is programmatic advertising?
Programmatic advertising is the automated process of buying and selling ad space using algorithms and real-time data.
Ideally, it aims to reach the desired group of people in the most effective way possible with the best possible type of content, whether that’s video, audio, or app campaigns.
What’s crucial is that programmatic advertising allows us to reach many different channels simultaneously, including websites, social media platforms, apps, and even digital out-of-home ad spaces (DOOH).
Examples of programmatic advertising
To grasp the idea of programmatic advertising, it’s best to look at it in action.
Let’s take our project for a client in the Home and Garden industry as an example. The story highlights the importance of data collection and a systematic approach to programmatic advertising.
We knew that to unleash the brand’s potential in a new market, we needed to fully understand its competitive advantages and potential angles to focus on while building our campaigns.
While it’s true that many elements can be automated in programmatic advertising, research is still required, especially during the first stages.
That’s why, in the first several months, we focused on gathering and analyzing data to tune up our customized algorithms, remarketing action rates, and determining the needed materials.
This meticulous work paid off handsomely. After the first three months of our programmatic campaigns, the KPIs were met.
And here are the impressive numbers:
- 57% decrease in cost per session
- 116.08% increase in ROAS
- 93% decrease in conversion cost
Another good example is our campaign for SGB-Bank. During the project, we took great advantage of Display & Video 360, Google’s powerful programmatic tool.
The ultimate goal of the project was to increase brand awareness, and by running a Brand Lift study, we determined that the best way to move forward was to use all the tools at our disposal, including:
- Meta Ads
- Google Ads
- And perhaps most importantly, programmatic ads using a YouTube Masthead video targeted SGB Bank’s in-market audience precisely.
During the campaign, various materials showcasing the new image of SGB Bank were presented to ⅓ of the entire population of Poland. Reaching those numbers would be impossible without a multi-channel approach, especially while maintaining low CPM (cost per mille).
Programmatic advertising vs Google Display Network
There are quite a few significant differences between programmatic advertising and advertising on Google Display Network.
The first one is right there in the name of the “Google Display Network”. It’s a specific Google ecosystem that enables you to run campaigns on Google’s search network, YouTube, and many of its blogs and various partner websites.
While it also uses automation and targeting, Google Ads is more platform-specific and often involves a mix of manual and automated campaign management.
Programmatic advertising takes a completely different approach. It involves buying and selling digital ad inventories across multiple platforms, using ad exchanges, demand-side platforms (DSPs), and real-time bidding to target ads across a wide range of websites, apps, and formats. This approach offers expansive reach and targeting based on real-time data.
Here’s a quick comparison between the two methods:
Ultimately, it’s worth noting that neither approach is inherently better; the choice depends on the campaign goals, audience, and desired reach.
How programmatic advertising works
The immense potential of programmatic advertising lies in connecting advertisers and publishers seamlessly through ad exchanges, supply-side platforms (SSPs), and demand-side platforms (DSPs).
Ad exchanges act as digital marketplaces where ad inventory is traded. SSPs help publishers manage and sell their inventory, while DSPs allow advertisers to bid on ad spaces in real time.
Users’ data—such as demographics, interests, and behavior—is analyzed in milliseconds when they visit a website or an app. If the user matches an advertiser’s criteria, a real-time bidding (RTB) auction takes place on the ad exchange. Advertisers compete for the chance to display their ad, and the highest bidder wins, delivering the ad instantly.
The process is highly efficient and largely effortless, as sophisticated algorithms automatically handle the buying and placement of ads, ensuring the right message reaches the right audience at the right time.
This precision and automation maximize campaign performance while reducing manual work, making programmatic advertising a game-changer in the digital ad space.
What are programmatic advertising platforms?
With the rise of programmatic advertising, many platforms focused specifically on this method have emerged.
Essentially, a programmatic advertising platform is a solution that gives you the tools to actually do programmatic advertising. That means allowing you to buy, sell, and deliver digital ads using data and algorithms.
Different platforms can vary in their features, capabilities, and focus areas, including:
- Inventory access: Some offer access to premium publishers or exclusive inventory, while others focus on open exchanges.
- Data integration: Certain platforms specialize in first-party data integration, while others rely heavily on third-party data or AI-driven insights.
- Cross-channel capabilities: Platforms may support a range of channels (e.g., display, video, connected TV, audio), but not all provide seamless integration across these formats.
- Ease of use: Some platforms are designed for beginner marketers, while others require technical expertise or agency partnerships.
When choosing the right platform, a company must consider factors such as automation efficiency, optimization capabilities, transparency, and data privacy, especially with evolving regulations like GDPR or CCPA.
Types of programmatic advertising
One of the greatest advantages of programmatic advertising is reaching your audience exactly how, where, and when it’s time to do it. It means placing your ad while a person is watching a YouTube video, listening to music or a podcast, or browsing a social media feed.
Because of that, good programmatic advertising campaigns usually utilize so many formats. Here are some of them:
- Display ads: Visually rich, banner-style ads on websites, apps, and social media platforms.
- Video ads: Delivered to users across websites, mobile apps, and streaming services. These can appear before, during, or after video content (pre-roll, mid-roll, and post-roll).
- Native ads: These ads match the look and feel of the surrounding content. They blend seamlessly into the website or app where they appear, mimicking the style of articles, product recommendations, or news feeds.
- Audio ads: Served across streaming platforms like Spotify, usually quite briefly for 15-30 seconds, focusing on audibly delivering a clear and compelling message.
- Social media ads: Programmatic ads can also be run on social media platforms like Facebook, Instagram, Twitter, and LinkedIn, where they appear in the form of promoted posts, stories, or side banners.
- Connected TV (CTV) ads: Served to users via internet-connected TVs, which can include ads during streaming services such as Hulu. They allow for targeted video advertising on a larger screen.
Each ad type offers unique ways to engage with audiences, depending on campaign goals, platform preferences, and the desired user experience.
You don’t have to include all of them, and in most cases, you won’t. However, it’s always worth researching to determine which options are the best for your campaign.
Benefits of programmatic advertising
Without a doubt, programmatic advertising can be an immensely powerful method in a good digital marketing strategy. If implemented correctly, it can be the crown jewel of your digital marketing strategy.
- Its precision targeting can leverage vast amounts of data to target users with remarkable accuracy. You can refine it based on demographics, interests, behaviors, location, and even real-time factors like browsing activity or weather.
- The automation of the buying and placement of ads saves valuable time and reduces manual processes. Real-time bidding (RTB) and algorithm-driven optimization allow for dynamic and efficient campaign execution without much of a hassle.
- Thanks to real-time campaign performance analysis, you can make data-driven adjustments on the fly. This includes tweaking targeting criteria, adjusting bids, and shifting budgets.
- With programmatic advertising, you can maximize cost-effectiveness by targeting the right audience at the right time, thus ensuring ad spend is used more efficiently.
- Cross-channel reach allows you to reach users across various platforms (websites, social media, mobile apps, video, etc.) and devices (smartphones, desktops, connected TV).
To sum it up, it addresses many key challenges modern brands face. Still, it’s not a self-playing piano.
To take advantage of it, programmatic advertising must be well-integrated into a broad digital marketing strategy, bringing us to the next point.
How to use programmatic advertising in digital marketing strategy
Programmatic advertising can undoubtedly play a crucial role in a digital marketing strategy, offering precision targeting, automation, and real-time optimization.
However, it’s important to remember that it’s just one tool in a marketer’s toolkit. While it excels at reaching specific audiences across various channels, its effectiveness is maximized when integrated with other strategies—such as content marketing, social media campaigns, and SEO—to create a cohesive, multi-channel approach.
Alongside these other tactics, programmatic advertising can help you enhance overall marketing impact and drive better results.
How to do programmatic advertising
Getting started with programmatic advertising can be a challenging process. Good, valid data, research, and analysis are critical to ensuring success.
Here’s a very brief overview of the steps:
1. Setting clear goals and KPIs
Before starting a programmatic campaign, it’s essential to define clear objectives, such as brand awareness, lead generation, or conversions.
2. Audience segmentation and data collection
Effective programmatic targeting relies on access to reliable data. To create accurate audience segments, first-party data (e.g., website visitor behavior, CRM data) must be gathered and combined with third-party data (e.g., demographic and behavioral insights).
3. Creating targeted campaigns
Audience segmentation allows you to craft campaigns that precisely target consumers based on behaviors, interests, location, and more. Valid data must be used to optimize this targeting, ensuring ads are served to the most relevant users.
4. Setting up and launching the campaign
At this stage, you will usually use automated ad inventory bidding tools available on every popular platform. Research on market demand and competition helps determine the optimal bidding strategy to achieve the best placements at the most efficient price.
5. Continuous monitoring and real-time optimization
Once the campaign is running, constant monitoring and analysis are crucial. Reviewing performance data (e.g., clicks, impressions, conversions) helps adjust targeting, bidding, and creative content for maximum effectiveness. This continuous optimization ensures that the campaign adapts and improves over time.
6. Reporting and data insights
After the campaign ends, a thorough analysis of the data collected (such as audience engagement, ROI, and cost-efficiency) is essential. This helps assess the campaign’s success and provides insights for future strategies.
In summary, the effective implementation of programmatic advertising depends on valid data, thorough research, and ongoing analysis to adjust and optimize campaigns.
Do you need help with programmatic?
As you see, making programmatic advertising work for you can be challenging, especially without experience.
Having the support of experts in the area can make a world of difference. You can read about a few stories that prove it in our programmatic case studies. As you’ll see from the results, the potential is surely worthwhile.
If you can’t wait to launch your campaigns, we can help you do so efficiently. Arrange a call with us, and let’s get started.
