If data are collected and never acted upon, what is the lost value to your business? Consider this: If the mass of available data were being optimized to its potential, advertisers would see much stronger ROI across their campaigns, and consumers would see more relevant advertising.
The tools for audience management and automated buying are now here — and advertiser adoption is on the rise.
According to Magna Global, programmatic transactions in the U.S. were poised to reach $10.9 billion in 2014, representing 62 percent of U.S. display-related digital spend. Magna predicts that by 2018, programmatic will represent 82 percent of U.S. display-related spend.
The story behind these numbers is that programmatic simply makes sense from an efficiency, ROI, audience, and creative perspective. Furthermore, data is foundational to programmatic ad buying, powering these key capabilities:
- Automated buying across channels (search, social, display, video, connected TV) and devices (mobile, tablet, PC)
- Audience-based buying
- Optimizations to meet advertisers’ objectives
- Dynamic experiences from display ad dynamic creative to landing page optimization
Efficiency At Multiple Levels
The very definition of programmatic — automated buying and selling of ad inventory — implies efficiency. The process of filling out insertion orders and communicating by e-mail or fax is now done automatically with a demand-side platform (DSP). DSP technology analyzes available inventory, refines optimization models, and can place real-time bids.
However, programmatic efficiency extends even further. Automated buys can be conducted and optimized across channels and devices, giving advertisers a centralized view of their digital campaigns.
For display, there is a shift to programmatic for all buy types (open auction, private exchanges, and guaranteed direct).
Real-time bidding (RTB), a form of programmatic, allows advertisers to buy display at the impression level in an auction environment. Programmatic also offers advertisers more control through frequency capping across inventory sources and the ability to optimize budgets across campaigns.
Finally, transparency into media costs, vendor fees, and where the ad appears gives advertisers peace of mind that was not possible with a “black box” buying platform. Automated decision making based on data improves efficiency in ad buying.
As Katy Wortham, Digital Marketing Manager at CreditCards.com attests:
The integration of our display program and our analytics, as well as transparency into our media costs, has armed us with the ability to track ROI more accurately and has provided valuable insights, enabling us to make smarter advertising decisions.
Driving ROI With Better Targeting
It’s impossible to talk about results in the ad business without focusing on audiences. Improved audience targeting and increased ROI were the top two benefits of programmatic listed by both agencies and marketers in the AdExchanger Report, “The State of Programmatic Media Q2 2014.”
Getting the right message to the right consumer at the right time in the right context to drive a conversion at the lowest price is the goal of every marketer, and accomplishing this in 2015 means making use of all available data sources.
A data management platform (DMP) allows marketers to create audience segments based on their own website visitors and offline customer data, combined with partner data and third-party sources.
Precise targeting of segments across channels, devices, and inventory sources results in improved ROI. The addition of multi-dimensional portfolio modeling, predictive modeling, and simulations further improves results through smarter budget allocation and bidding.
Delivering Dynamic Digital Experiences
A highly targeted audience does not guarantee positive results without highly targeted creative. When marketers use all the available data sources to better understand the customer journey, they can deliver relevant messages across channels related to the context and the stage in the buying cycle.
Creative content can be structured to flow from a display ad to landing page, and repeat impressions can be customized for device types and media context. Only programmatic ad buying has the power to deliver these experiences at scale.
Past The Tipping Point Of Programmatic
While the majority of display ad spending is now focused on programmatic, the challenge for marketers is implementing the systems that connect and facilitate action upon all the available data sources.
Connecting data that has existed in siloes via site analytics, CRM, and POS systems to advertising and marketing data is the key to unlocking the power of programmatic — and the future of online advertising.
Opinions expressed in this article are those of the guest author and not necessarily Marketing Land. Staff authors are listed here.