Programmatic advertising may be set to account for 28% of global digital media spend in 2018, but confusion still exists within marketing communities about what the technology is, how it’s used and how to get the most out of it.
I’ve heard the term used in a variety of ways: as a plural (“what programmatics are we doing?”), a media channel (“we need to do some programmatic”), a source of cheap advertising (“that’s too expensive, use programmatic to make it cheaper”), and most worryingly a synonym for fraud (“we don’t want any of that dodgy programmatic stuff…”).
Programmatic technology has suffered following a media smear campaign by publishers with a significant vested interest, and bad press around its potential for fraud when mismanaged. But if you understand the premise of the technology, you’ll understand that it’s the cornerstone of advertising’s future.
So what is programmatic technology?
There are many definitions of what constitutes programmatic advertising, and most will include some combination of:
- media buying
Sometimes there’ll be a real-time element to the definition as well, although there is a clear distinction between real-time bidding and programmatic advertising.
My personal definition is:
"The harnessing of technology to make advertising decisions based on pre-defined criteria"
Based on this definition you could argue that PPC is programmatic, with the “pre-defined criteria” being keywords, location data or retargeting lists. Likewise paid social advertising with its myriad of targeting options could be considered programmatic.
However one prevailing element of programmatic advertising we could see moving forward is the use of a third party technology to initiate the buying and management, something which is not always true of Adwords, Facebook, Twitter and co.
Why is Programmatic the Future of Media Buying?
Programmatic technology takes control of the advertising management away from the media owner and places it in the hands of the advertiser or their nominated agency. It brings a flexibility to advertising channels where it didn’t previously exist, and that will always be seen as a good thing from an advertiser’s perspective.
Where previously you had to commit to a fixed budget over a fixed period, you can now start with a small budget, pause and activate whenever you see fit, pay an amount that suits your ROI, and amend your budget at any point based on performance.
It removes a lot of the barriers to entry that previously existed in display and continues to exist in channels such as Out of Home and TV.
So when is the revolution coming?
Soon. Programmatic audio is now available in part through Radio Trade Desks, online audio platforms such as Spotify and other music streaming services.
Programmatic OOH has a few applications which are making it work, although this is mostly limited to the activation of pre-bought space at present.
Programmatic TV is available through OOT services such as 4OD and Sky, via its Sky Adsmart offering which it is rapidly expanding in the coming year.
The delays are mostly down to the required infrastructure being put in place and the testing and adoption from the advertisers themselves.
How can advertisers get ready?
Hopefully you’re some way down the process already. It starts with testing.
This involves trialling programmatic buying options and technology to understand how it works, the process involved and the benefits it can bring to your business.
Build your understanding in the channels programmatic technology is already dominant (display, paid social, online video) as similar principles will be applied once it enters other areas of the advertising ecosystem.
By starting your learning curve now, you hopefully won’t find yourself playing catch up in years to come.