Our video series Digital Marketing Glossary continues: today we take a closer look at one of the essential approaches to any media buyer’s digital strategy – Programmatic AD Buying [Video]

The advertising technology is moving rapidly toward automation, as the new methods are being tested to allow more efficient and effective ad space buying. This is where programmatic jumps in: trough the data analysis, it can figure out the right ad and direct it to the the right audience at the right time. The technology behind it allows computers to handle all of the process related to media buying, from ad insertion to results monitoring.

To sum it up, programmatic ad buying is the use of real-time, software-based systems, rules and algorithms that automates and optimizes the purchase and delivery of targeted and relevant ads to consumers.

In the words of Peter Naylor, former vp at NBCUniversal¹,

Programmatic is advertising’s newer, better mousetrap.

In the terms of growth, as shown by the recent research by eMarketer, programmatic digital display ad spending will leap 48.9% this year to hit $14.88 billion, or 55.0% of total digital display ad spend. Furthermore, 62% of senior marketers polled in UK and US  said their companies ran programmatic advertising campaigns for branding objectives. What was holding back nearly four in ten non-users from buying in, or existing users from investing further? Data privacy concerns and difficulty proving return on investment were the two most common issues, each cited by 23% of respondents. Lack of quality data (18%), a complex marketplace (17%) and lack of transparency (16%) rounded out the top five.

The “early adapters” of this ad buying technology are surely social media channels, such as Facebook, Twitter and LinkedIn, that have acquired numerous programmatic ad-tech companies in order to enter the global ad selling, not only through their own platforms by all over the web.

One of the future trends in marketing campaigns will surely be the challenge of making them much more strategic. With programmatic ad buying, you pay only for the target you want to reach, without paying the large amount of impressions and hoping to reach your target audience, as pointed out in the insight by Mindgruve. And of course, by acting in this way, you can reduce costs, because thanks to the real-time bidding, advertisers now have the power to set their bid based on how valuable that impression is at that exact moment.

Stay tuned for the next articles and videos from our Digital Marketing Glossary series! Visit our YouTube channel for full playlist!

 

1. Programmatic for Dummies Everyone says it’s exploding, but what is it? by AdWeek