If you are in or around advertising circles, you’ve heard the term “programmatic” at some point. Many “programmatic” conversations will consist of people nodding their heads knowingly, while thinking to themselves, “What the hell is programmatic?” This term is going to be heard more and more in the coming years, so if you have to know what it means (you do) then you might as well start today.
Programmatic is a term that covers a variety of functions, but in broad strokes it is essentially an automated system of buying media. The goal is for more efficient advertising through the automation of planning and buying through platforms that aggregate publishers and allow ad buying across all of them. This means better targeting so that ads that are more relevant to users.
When we’re done today, you’ll be able to nod your head knowingly. But this time you’ll mean it.
Programmatic takes the leg-work out of display advertising by making it easier and more effective to automatedly bid and report across multiple publishers.
MORE EFFICIENT BUYING? HELL YES!
Automation is making our lives easier in a number of ways, helping businesses create more reliable work at lower costs. Programmatic simply does this for media buying. The days of negotiating a fixed CPM, signing IOs for each partner, distributing creative, aggregating reporting for all partners and many more time consuming tasks are coming to an end if programmatic has any say.
The real game-changer is buying media through a Demand Side Platform (DSP), which allows you to aggregate all publishers in a single platform, side-stepping the one-on-one management of each publisher. In theory, the process becomes highly streamlined, however in practice, it’s still complicated by the fact that DSP’s are massively fragmented, e.g. there’s DoubleClick Bid Manager, MediaMath, Turn, AppNexus just to name a few. Some offer fully managed services, others offer self-service and they all have their own bidding algorithms.
Variety can be a benefit but in terms of programmatic, the increased noise doesn’t help with the confusion.
On our Hatch:Programmatic course, graduates will understand how to create, manage & optimise large scale programmatic display campaigns with direct response goals. Students will understand the rapidly evolving landscape of programmatic including some of the common myths and misconceptions, who the key players are and the role that different types of data play in prospecting and retargeting.
MORE EFFICIENT MEDIA? COUNT ON IT!
Without programmatic there is a lot of inefficiency and guesswork involved in media buying. You pay a fixed CPM based on pre-defined assumptions about an audience, with the cost often having no relation as to whether you engaged with the right audience or not. Essentially, a large proportion of ads are viewed by users who have little to no interest in the product.
DSP’s address this problem by facilitating the media buy and making it more precise. An online auction allows you to bid on an impression-by-impression basis, dependent on how valuable that user actually is. In combination with the overlaying of data sets — what you are looking for vs what we know about the user — you are now equipped to make better buying decisions.
A new parent gets an ad for baby food. The advertiser wins, the publisher wins and so does the customer.
Great! You now now have an understanding of some of the fundamentals of programmatic and are fully equipped to head-nod with conviction next time the topic is raised. In part two we will dive deeper into four key programmatic components. Itching for advanced knowledge? Then join our Hatch:Programmatic course or read the next post in this series, The Four Key Principles of Programmatic
About me — author & course leader: I’ve spent 5 years in client services, media planning/buying and client-side roles at industry-leading advertisers, digital agencies and trading desks, including iProspect, AMNET, MoneySuperMarket and TUI. I’ve witnessed first-hand the evolution of programmatic from the very early days and has worked across a number of verticals including finance, travel, entertainment and ecommerce.