Programmatic Advertising The next big digital trend on the horizon

Today’s marketers are often tasked with doing more … with less; while at the same time demonstrating a clearly attributable return on investment. With all the digital marketing options in the marketplace, it can be challenging to know where to begin. Many brands have decided to invest in programmatic advertising as the backbone of their digital strategy, and are being rewarded with unprecedented results.

The power of data and predictive analytics

The ability to tie multiple devices and online and offline revenue to an individual is changing how marketers advertise. Programmatic advertising involves automated bidding on ad inventory in real time—countless brands all competing for an opportunity to show an ad to a specific consumer in a specific context.

Marketers can tailor their ads based on the data they are collecting and serve them up to potential customers. The primary advantage of this type of marketing is the quality of leads it generates. Imagine being able to use algorithms that synthesize readily available data to identify ad matches based on age, gender, income, geography and a multitude of other variables. It's next-level marketing.

Increased digital spend, higher returns

Shoppers expect a personalized experience when it comes to advertising. Retailers must be able to understand and collect deeper insights into user behaviors. Within the next few years, programmatic advertising will account for the majority of all digital advertising spend. According to AdAge, companies are spending money on programmatic—and it's working. Google upped its programmatic spend in 2016, and expects to see a year-over-year increase of 150% to 200% in programmatic direct deals.1

All this digital spend prompts a question: Why?

The Rubicon Project and TFQ Strategy conducted a study on media spend and sales across the 200 largest U.S. brand marketers. Their research showed that the marketers who "reallocate budgets to, on average, double their investment in programmatic, could see a 6% increase in sales and a 22% increase in marketing return on investment."2

In real-world terms, programmatic translates to a scenario like this: A retailer has a web page with advertising configured for programmatic advertising, and wants to market to consumers in a relevant way. A potential customer interested in a particular dress sees an ad with a coupon for it, and clicks on it.

She clicks on the ad, and ideally makes a purchase. If not, the retailer could now send that consumer a direct mail piece with a personalized coupon for the dress—all in a very timely manner.

A real winner

Here's a real case study of programmatic marketing in action. A UK-based energy supplier wanted to attract and target consumers to switch energy suppliers. They decided to feature programmatic advertising within a multichannel awareness campaign in pursuit of this goal.

The campaign incorporated a few different digital touchpoints, including video display ads and remarketing banners (served to visitors who had interacted with the company's landing page). The banners led users to more information or a quote. By deploying an impression-based strategy with multimedia ad content, the marketing team was able to tie the results of each individual component together and clearly assess the full impact of utilizing programmatic video and display and impression-based marketing, the company was able to tie all of its marketing efforts together and understand the impact of its efforts—both holistically and granularly. For instance, they found that users who interacted with the campaign showed a higher level of awareness and uplift in consideration; and those who had engaged with the brand were 35% more inclined to consider buying energy from them than users who had not engaged. In addition, ad click-throughs resulted in an average website visit duration of 28 seconds—65% longer than the average session during a typical campaign. 3

Getting started

When considering programmatic advertising, it's important to think through a few critical details initially. Three vital factors are ROI, data and mobile friendliness. Because programmatic involves bidding, building in a maximum spend ceiling to avoid overspending is essential.

In terms of data, marketers need the bandwidth and skill set to continuously track and analyze customer information, then leverage the insights to optimize targeting.

Lastly, any ad deployed must be mobile friendly. The target audience should be able to seamlessly engage with your ads on any device they choose. So thorough testing is mandatory.

Programmatic advertising takes digital personalization to a new level of precision. Although executing an effective programmatic strategy takes expertise and effort, its impressive ROI is motivating more and more brands to get in the game.

Want to discuss ways to raise the bar for your brand's communications? Talk to an RRD expert.

Share and Connect

  1. Ad Age. Google Says Programmatic Direct Is Due for a Rise in 2017 (2016)
  2. Rubicon Project. Programmatic, Proven (2016)
  3. DoubleClick by Google. OVO Energy Uses DoubleClick to Integrate a Campaign from Start to Finish (2017)