Spend a day or two around the digital advertising community, and you’ll probably hear the word that seems to be on everyone’s minds: Programmatic.
There’s lot of excitement surrounding these technologies and the way they’re changing the way we buy and sell media. With the ability to target individual impressions most likely to become buyers – and automate transactions so they can happen in real time – programmatic is poised to change the face of digital advertising. As more media professionals are embracing programmatic, many are realizing something they didn’t know before: They’ve been using programmatic all along. You might not know it yet, but if you’re using a certain popular advertising tactic, you’re already using programmatic too.
Programmatic is Exciting but Intimidating
The laundry list of benefits associated with programmatic technologies sounds awesome. Who wouldn’t want better relationships with consumers, more time to focus on strategy and creative, and a higher ROI on their ad spend? But programmatic also seems complicated. Almost everyone in the digital advertising community has heard of the term, but few media professionals understand and apply it. A study released by the Association of National Advertisers and Forrester found that only 23% of marketers understand programmatic and use it to execute campaigns. There are thousands of articles urging media professionals to embrace programmatic as the future of digital advertising, but making the leap can be intimidating. It can be especially tough for established professionals hesitant to develop new data-driven skill sets. Incorporating programmatic technologies can increase the ROI on your ad spend and put you in a great position to thrive moving forward. But is it an all or nothing proposition? Do you have to overcome the intimidation and leap off the cliff into something new? Not at all.
Many media professionals don’t realize it, but they’ve already dipped their toes into the world of programmatic trading. Understanding this can help them feel less intimidated going forward. And it only gets easier as they expand their knowledge and become more comfortable with the technologies.
The Nuts and Bolts of Programmatic
“Programmatic” is an umbrella term for technologies that help media professionals trade media using automated systems. Instead of negotiating with sellers directly (and dealing with tedious tasks like faxing insertion orders), buyers can purchase ad inventory through automated dashboards and trading desks. Search marketers have been using programmatic for a decade now, pricing and placing impressions based on keywords users type into search engines. This happens in a real-time auction environment. Basically, it’s a more efficient way to transact media. Many marketers, confused and intimidated by programmatic, associate it with trading media through real time bidding (or “RTB”) – similar to how search marketers have done it for years. But that’s a misconception; RTB is just one of programmatic’s many applications. The terms aren’t interchangeable. Another popular programmatic application is also one you might be using already: retargeting.
If You’re Using Retargeting, You Know More about Programmatic than You Think
Retargeting is enormously popular right now. And with good reason; technologies have given advertisers the ability to target specific users who have visited their websites or typed in specific search terms. Instead of paying for banner ads in certain locations (buying media), they’re able to buy individual, highly targeted impressions. Many marketers are doing this and seeing good results. But a lot of them don’t realize that retargeting isn’t just a cool tactic to make their ad spends more profitable; it’s also an application of programmatic media buying. These marketers are hesitant to take the leap into programmatic, but they don’t realize they’ve already jumped. If they’re familiar with retargeting, it’s easier for them to gradually expand their knowledge and get comfortable with other programmatic applications.
Retargeting Relies on Programmatic Technologies
The fundamental difference between retargeting and standard display ads: retargeting allows advertisers to target specific users based on their previous behavior. This wouldn’t be possible without programmatic technologies. Retargeting ads are served to visitors based on their past browsing history. But where the ads are served isn’t limited to a specific location. Retargeting ads “follow” the targeted user online in the sense that they’re served wherever the user goes; you’re buying the impression instead of the media. Retargeting’s effectiveness depends on connecting with specific users wherever they go online at the perfect time. This would be a nightmare without programmatic technologies. Manual negotiations for ad placements would be impossible because buyers couldn’t predict where the targeted users would go online next. Even if buyers were somehow able to know where visitors would go, they wouldn’t be able to secure the ad inventory in time. Visitors would have already come and gone by the time manual negotiations ended. Without programmatic, it would also be impossible to single out which users to retarget. Programmatic technologies aggregate data about users’ behaviors and allow buyers to leverage it through automated platforms. Without it, you wouldn’t be able to focus your ad spend on people who already visited your website or typed in certain search terms.
Bottom line: programmatic technologies are essential in helping make retargeting the profitable advertising strategy it is today. If you know the nuts and bolts of retargeting, you know more about programmatic than you might realize.
There’s No Need to Be Intimidated
Programmatic sounds scary, but there’s no reason to be intimidated.
Many marketers are already using programmatic without even realizing it. They’ve already taken the hardest step. With retargeting, they’ve broadened their perspective about targeting specific impressions instead of media. And they’ve also embraced the utility of having automated systems serve ads to targeted users, saving them countless hours of time and trouble. Programmatic is the new frontier in the digital advertising world. It represents a fundamental change in the way we buy and sell media. But there’s no reason why you can’t make the journey in baby steps, gradually expanding your understanding of its applications and benefits as you go along.
And who knows? You might be farther along than you realize.