Yesterday our president and co-founder, JJ Bannasch, spoke at the San Diego Ad Club’s interactive Programmatic Marketing Workshop in downtown San Diego. The event, hosted by OpenX, welcomed industry professionals to participate in a table discussion with three different parties involved in the programmatic marketing ecosystem: someone who makes inventory available (OpenX), someone who has the technology (The Trade Desk) and an agency representative who uses the platform to buy inventory (Katana).
What is Programmatic Media?
The panel discussed the importance of understanding the complexity around executing programmatic media buying campaigns. Programmatic media, also referred to as “real-time media,” represents a new approach to media buying in the digital advertising world. Instead of negotiating deals manually—through direct conversations between buyers and sellers, RFP’s or faxed insertion orders—media professionals transact using an automated system similar to how stocks are purchased via technology transactions instead of the traditional paper trades.
The panel addressed the challenges of real-time media, addressing concerns such as viewability and fraud. Other challenges range from increased technical requirements, high fluidity, an immense amount of data flow, to a potential of fraudulent ad impressions that prevent media buyers from executing profitable campaigns. Identifying these complications beforehand, along with the key components that make programmatic campaigns successful, is the most effective way to overcome challenges and make the most of limited ad spend. The six essential elements to a successful real-time media campaign are:
- Buying + Optimization
- Fraud Management + Viewability
How Do You Buy Programmatic Media?
Buying media programmatically has shifted from an afterthought to a chief consideration in media plan design. 41.6% of surveyed advertisers (including agencies and marketers) said that programmatic is “top of mind” when strategizing media plans. However, despite this increased attention to programmatic’s importance, a joint report from AppNexus, WARC, and IAB found that less than half of media professionals have a programmatic strategy in place for their campaigns.
Even though programmatic marketing is automated and “machine operated,” Bannasch echoed the importance of having a skilled team to sufficiently run the platforms. The importance of finding a team that can help you develop the perfect combination of testing, segmentation and buying tactics to reach your goals is immeasurable. These strategic thinkers should also have mechanisms in place to assess your campaign’s targeting, messaging and audience behavior. Insights drawn from ongoing testing can help identify where to allocate your ad spend to have the greatest impact and generate the highest ROI.
Programmatic ads are bought on an impression-by-impression basis. Instead of negotiating ad placement with a single orientation such as contextual category, digital marketers can target individuals through a large multitude of options. In essence, programmatic media has significantly expanded the orientation of an audience media buy versus a place based buy.
As mentioned earlier, the core essence of programmatic inventory is that it is purchased in a non-human fashion through a filtered-based decision engine. In a buying environment, a buyer sets their request for what type of audience, inventory and pricing they want to purchase. This request is sent to the ad exchanges that the buyer has access to via their DSP (demand side platform).
Certain DSPs have access to bid speed privileges with prime inventory locations over other DSPs, so it’s important to be equipped with a DSP that offers the greatest inventory coverage, best rates and fastest speed. To execute this strategy, marketers should leverage multiple DSPs and test them out for specific inventory strategies. The ideal programmatic inventory starts with a well-thought-out plan, a structured testing and optimization methodology and access to the optimal DSP stack to give you the proper inventory options.
Programmatic media buying is the fastest growing area of online advertising. By 2017, programmatic media sales will account for 83% of all US digital display ad spending. This form of advertising is a large opportunity for marketers to experience greater efficiencies, control and effectiveness, but it commands new sets of media team capabilities and setups. Technical, analytical, real-time and proactive methodologies are a few characteristics required to optimally take advantage of programmatic media.