What is programmatic advertising?
With the evolution of digitalisation and technologies such as blockchain and artificial intelligence, the advertising and marketing industry has created new disciplines, products and services such as programmatic advertising.
This is a type of online advertising that refers to an automated purchase of advertising space and audiences on the internet. It connects a brand to the user with a relevant ad, at the right ‘digital’ time and place. As the transformation and digitisation of media is spreading to almost all media, programmatic advertising can facilitate brand advertising in digital newspapers as well as on digitised TV or radio, and even digitised outdoor media.
It is a form of advertising called ‘display’, which allows the advertiser to access a series of advertising spaces, called inventory, and does so through on-demand technology platforms on websites or digitised spaces. Programmatic buying allows advertisers to connect their brand with the target audience they want, at the time they want, and in the geographic location of their choice. It is a discipline of our time, born to streamline the visibility and connection of brands and their campaigns with their current and potential customers.
The growth of programmatic advertising
In the midst of the digital era, in which advertising investment for user acquisition happens through digital media, 70% of this investment corresponds to programmatic buying, according to the report on Investment in Digital Media published by IAB.
Spending on programmatic advertising in 2021, according to Statista, was over $150 billion, and this industry doubles in size every 4 years, expected to grow at 35% annually until 2025. This makes programmatic advertising one of the most active industries.
How it works
Big Data and artificial intelligence are used to select and segment the audience. Once the audience has been segmented, media related to the audience is selected and the advertising campaign that is directed to the selected target audience is activated.
Programmatic buying is a way of buying online advertising space in an automated way. This purchase can be made on different media and websites from the same control panel by searching for specific audiences and users to impact at exact times.
- Every time a user arrives at a website related to programmatic advertising, the automated advertising process is activated so that the advertising starts.
- The website owner puts the ad impression up for auction.
- Advertisers then bid for the impression, for the visibility of the ad. It should be noted that this process occurs in real-time, which is why some refer to programmatic advertising as real-time bidding.
- The highest bidder, the advertiser with the highest bid, wins the ad impression.
- The ad appears on the user’s website
- The user can click to visit the page and/or convert.
Advantages of programmatic advertising
Segmentation by users and personalised messages
With Big Data we can get to know users in a much broader way in terms of characteristics, uses or type of online purchase. This data helps us to carry out a greater segmentation of users that allows us to better reach our target audience.
In addition, segmentation facilitates better communication with our target audience and increases the precision in the creation of a campaign.
On the other hand, geolocation is one of the most widely used criteria, as it offers the possibility of offering the ideal product or service to the user, at the moment they are looking for it, in a personalised way. Various messages can be designed according to the profile of the audience.
Automation and agility in the buying process
Programmatic advertising is carried out in an automated way. Programmatic buying is driven through a combination of three platforms, which together offer a complete service: Ad Exchange, DSPs and SSPs.
Thanks to programmatic advertising platforms, we can reach a user anywhere in the world. This is due to the breadth of supply and demand in programmatic advertising in a globalised market. The variety of advertising supports, and media, in which the different services can be offered, increases the offer of this type of advertising. The reach is greater.
Measuring results and optimisation
Data abounds in programmatic campaigns, and for advertisers this is of great value. Measuring this data offers the possibility to see what is working and what is not, and to optimise.
We are talking about campaigns that can be modified in real-time, so the time in which you can react is almost immediate.
Reasons to run programmatic advertising campaigns:
Automation and agility in the process of buying, planning and management of advertising space
Programmatic advertising allows you to manage campaigns quickly and efficiently. This type of advertising eliminates the intermediaries in the process of buying and selling advertising space. The ads are automatically published according to the settings you have managed for your digital advertising campaign. You only have to decide the duration of the campaign, the media in which to appear and the budget.
Transparency and control
Programmatic advertising is transparent and allows you to know all the data of the advertising campaign from the moment the action is launched until it ends.
Does the campaign work, and is there any data that can be modified to implement its reach? Programmatic advertising is measurable and quantifiable in real-time.
Knowing who we want to target with an advertising campaign is essential. Programmatic advertising offers a wide range of personalisation options: by gender, tastes, age, media or geolocation, among others. Focusing impacts on geolocation is essential to reach your target audience.
Return on advertising investment
Programmatic advertising uses the pay-per-impression method (CPM: cost per thousand impressions). And every time a user visits a website or app, their ad space is automatically auctioned. This way, the ads will appear in front of your potential customers, on the websites you decide and in the selected time range.
Positioning and reach
Another benefit of this type of advertising is its wide audience reach. On the Internet there are more than 4 million people connected daily and among all these users are your potential customers. The good thing about advertising on the net is the possibility of placing a brand, product or service in the minds of consumers. And one of the most used strategies is retargeting, which consists of re-engaging those users who have already visited your website through personalised messages and advertisements.
Adaptability to devices
Programmatic advertising has a responsive design, so that ads will adapt to the different devices of the audience of your campaign.
Did you know that 11Onze.cat has recently won an award for the best responsive website? A Laus.
From June 2022, 11Onze District, the advertising and marketing agency of 11Onze, can carry out programmatic advertising campaigns for partner brands of 11Onze. Do you want to advertise anywhere in the world or in any city or town?
Contact us at: [email protected]
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