Everything You Need To Know about Programmatic Advertising

Posted: October 19, 2022

Corey Ferrara Digital Marketing Specialist

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Programmatic advertising has been among the buzzwords of the marketing industry for quite some time now. But what exactly is it? And how does it differ from traditional display marketing?

Here’s everything you need to know about programmatic advertising.

WHAT IS PROGRAMMATIC ADVERTISING?

Programmatic ad buying uses programmatic technologies and algorithms for media procurement. In this instance, programmatic refers to the method advertisers use when purchasing media.

Programmatic advertising differs from traditional buying processes based on its reliance on automated technology. It assesses users’ signals to select the best platform for the ad to be served on.

PROGRAMMATIC ADS VERSUS DISPLAY ADS

It’s easy to forget the differences between display and programmatic ads, especially when Google has made so many advances in generating real-time and automated bids.

The biggest difference between programmatic and display is how ads are purchased. Programmatic refers to how ads are bought, while Display indicates the format of how ads appear.

A larger difference between programmatic and display ads is the fact that programmatic placements can be bought across a larger set of publishers and platforms. In other words, programmatic has taken display ads to the next level by allowing advertisers the opportunity to buy ad inventory across multiple open network platforms while display typically refers to placing ads on one specific ad network like Google.

With both programmatic and display, advertisers continue to have control over:

  • Audience.
  • Bidding strategy.
  • Budget.
  • Creative and assets.
  • Placements.
Programmatic refers to how ads are bought, while Display indicates the format of how ads appear.

PROGRAMMATIC ADVERTISING PLATFORMS

Advancements in computerized technology have made accommodations remarkable. Various forms of programmable systems exist.

The three main types of platforms are sell-side platforms (SSP), demand-side platforms (DSP), and ad exchanges.

  • Also known as a supply-side platform, a sell-side platform sells ad impressions to advertisers in real time. This platform includes both demand-side platforms and ad exchanges. Some of the major players in SSPs are Google Ad Manager, Amazon Publisher Services, Verizon Media, and Google AdMob.
  • Demand-side platforms allow advertisers to buy a variety of inventory on multiple platforms at the same time. The biggest platforms here include Display & Video 360 (Google), Amazon DSP, LiveRamp, StackAdapt, AdRoll, and MediaMath.
  • Ad exchanges are essentially a middle-man between SSPs and DSPs. The DSP will connect to an ad exchanger, where ad prices may fluctuate based on the competitiveness of the inventory. SSPs are supplying the inventory. The biggest ad exchangers are Xandr (Microsoft), Verizon Media, OpenX, PubMatic, and Google Ad Exchange.

HOW MUCH DOES PROGRAMMATIC ADVERTISING COST?

Prices can be anywhere between the amount you are willing to spend and the minimum budget for the advertisement. There are programmatic advertising platforms that do have required ad spend budgets. However, there are cost-effective options out there too.

It’s usually believed that small businesses and organizations can’t use programmatic technology, but there is still some misconception about this in the business world.

Programmatic advertising is usually bought on a cost-per-thousand-views (CPM) basis, and the price of CPMs may range anywhere from $0.50 to $2.00. However, CPMs can differ based on factors like which DSP you choose, such as the target audience or the degree of competitiveness.

Whether your company is large or small, you can still include programmatic advertising in your advertising budget.

Some programmatic advertising platforms that do have required ad spend budgets, but there are cost-effective options out there too.

WHAT ARE THE ADVANTAGES OF PROGRAMMATIC ADVERTISING?

Various benefits are offered by incorporating programmatic advertising into your marketing plan. Some of the main advantages involve:

  • A large target audience.
  • Cost-effective and easy-to-implement awareness. 
  • Fast access to real-time stats and big data.
  • Capability to pair first-party and third-party data. 
  • Opportunities for cross-device campaign strategies.

Large Target Audience

Programmatic is the easiest way to shop for display advertising inventory to reach the masses.

The ability to scale is another advantage of programmatic buying. Predefined programmatic strategies make it simple to buy inventory in large quantities to reach the masses.

Cost-effective and Easy to Implement Awareness

Programmatic advertising is among the most cost-effective advertising methods available. Regardless of the size of the budget on programmatic display platforms, you can reach your targeted audience and increase the awareness of your product or service due to the vast supply of inventory and targeting options.

Fast Access To Real-time Stats and Big Data

Because programmatic platforms are established on real-time bidding, advertisers receive a real-time boost because of analytics. Why is this beneficial for you? Real-time information lets you make faster choices and pivots before being caught off guard.

First- and Third-Party Data

Another advantage of programmatic advertising is that advertisers have access to different segments for targeting consumers. One way to do this is by using first-party data that has been gathered in a confidential way. It can then be bid for in real time using real-time bidding signals.

DSPs also have a variety of third-party segments advertisers may choose from if they don’t have first-party data. Using data that aren’t from the source to create lookalike audiences of their constituents is another form of third-party data advertisers can make use of.

This road can show you how to garner more customers similar to your existing ones.

Cross-device Campaign Strategies

It is important that programmatic advertising be seen as an awareness tactic. For this reason, companies that focus only on last-click success often overlook the true power of programmatic advertising. Namely, how does it fit into cross-device targeting?

One of the first approaches to capturing the attention of users is with programmatic advertisements. Though it isn’t likely a user will buy on their first interaction with the brand, your brand emphasizes its appeal by remarketing to them on various other platforms based on their engagement or initial interaction with that ad.

Data from the very first interaction with programmatic activities to your end goal should be combined to examine whether your plan is working.

TYPES OF PROGRAMMATIC ADVERTISING

There are several types of programmatic advertising.

  • Real-time bidding is an auction in which advertisers bid in real-time. This term is also known as the open marketplace.
  • Private marketplace bidding process occurs with publishers who have an agreed-upon number of advertisers. Typically, these websites offer premium prices due to the demand for greater advertising space.
  • Preferred Deals are a lesser-known subset of programmatic advertising also known as spot buying. Advertisers choose chosen locations before they resell or open them to the public.
  • Programmatic Guaranteed is when a buyer and a supplier agree on a price for advertising inventory in accordance with the publisher’s preferred contract but without a bidding process.

USING PROGRAMMATIC ADS IN HIGHER ED

Programmatic is a top-of-the-funnel tactic that drives brand awareness. This tactic is going to work very well to reach people that are not familiar with your institution. It also works as a retargeting tactic that is employed after someone has visited the website.

To break the process down into simpler terms:

  • An ad is served to an user introducing the user to the brand.
  • The user clicks on the ad and is directed to the landing page.
  • The user takes the desired action on the landing page.
  • If the user doesn’t convert they will then be retargeted with another ad from the programmatic advertising platform continuing to keep the brand top of mind.

The benefits of incorporating programmatic advertising into top-of-funnel tactics are clear. It is a tactic that is going to assist and propel the mid- and bottom-of-funnel tactics. Programmatic ads are arguably the best way to drive brand awareness and should be incorporated into your institution’s media plan.

Looking for a partner as you navigate the world of digital advertising? VisionPoint has over 20 years of expertise in higher ed marketing, including trend-setting results on programmatic platforms. Email us at info@visionpointmarketing.com to schedule a conversation or learn more.