Mastering Programmatic: A Step-by-Step Guide

Programmatic advertising is revolutionizing the way digital marketing is executed, automating the buying and selling of advertising sales in real time using technology to target audiences in a more efficient and effective way.

It replaces the traditional media buying process of proposals, negotiations and orders.

In this step-by-step guide to programmatic advertising, we will cover the key aspects of understanding how programmatic advertising works and what it offers.

Key benefits of programmatic advertising

These are the benefits of using programmatic advertising in your digital marketing strategy:

Improves campaign contracting processes.
Reduces management time
Optimize results
Provides greater control over analytics
Provides transparency and market price comparison
Improves campaign target affinity

Understanding the programmatic ecosystem

These are the key players in programmatic:

Advertisers: Brands or agencies looking to reach target audiences.
Trading Desks: A trading desk is a platform or team specialized in the purchase and management of advertising inventory in real time, through automated processes. It optimizes the purchase of programmatic ads in a more efficient and personalized way.
AdExchanges: Where publishers can share their inventory directly with their advertisers, avoiding intermediaries. They can also expand their reach and go international automatically, while maintaining control of CPMs and limits.
SSP: It is a technological platform for automated commercial management technology. Its mission is to enable publishers to manage their ad inventory and maximize revenue by providing an efficient, secure and convenient way to connect to the various DSPs operating in the so-called ‘ad exchange environment in all its buying modes, in all its buying modalities.
DSP: A DSP is a platform that enables the centralized buying of inventory from a variety of sources, including ad exchanges, ad networks and optimization platforms. It provides workflow simplification, access to real-time supply, algorithmic optimization and reporting.
Ad Networks: Connect advertisers with publishers, often filling unsold ad inventory.

Real Time Bidding or Deals

Terms to know about RTB or Real Time Bidding, a method of buying online digital advertising through bids for different ad spaces.

Bid Request: A signal sent by a publisher’s ad server to potential advertisers (or their demand-side platforms, or DSPs) in real time to solicit bids for available ad space on a website, mobile app, or other digital property.
Bid Response: The response from a demand-side platform (DSP) or advertiser to a bid request issued by a publisher’s ad server through a supply-side platform (SSP) or ad exchange.
Floor Price: Floor prices refer to a minimum auction price set by the advertiser in the SSP through the bid request. This is the value below which an ad cannot be sold on an ad server.
Fixed Price: The total price paid by the advertiser is “fixed” before the advertiser’s ads are placed in a publisher’s ad space. This means that there are no auctions or bids in the bidding process.

How do I want to buy?

Open RTB

Inventory is made available on the open marketplace to the highest bidder. Barriers to entry can be controlled by setting rules/floor prices.

Deals:

Private Marketplace (PMP): Inventory is offered to selected buyers, which can be more secure than an open exchange, an invitation-only auction where premium publishers invite selected advertisers to bid on their inventory. Packaging data and inventory together in a PMP can have a positive effect on CPM, this type of deal requires a human touch in the sales process.
Programmatic Direct: A pre-negotiated deal between an advertiser and a publisher without an auction.
Preferred Deals: Advertisers can buy inventory before it is available on open auctions, at a fixed price.
Programmatic Guaranteed: A guaranteed buy directly from a publisher with a fixed CPM and guaranteed volume of impressions.

The role of Data in Programmatic

Types of Data:

First Party Data:Information you collect directly from your customers, data of the highest possible quality and reliability.

Can come from the advertiser or the publisher
Commercial / advertising learning
Ability to extend data externally
Scale limitation
Competitive advantage
Careful attention to data quality and customer interaction management

Origin first party data: Website data, CRM/registration data, email data, digital campaign data, search data, mobile app data…etc

Second Party Data: Another organization’s first-party data that you can access through a partnership, obtained through an agreement with another company that captures the data at the source.

Strategic and synergistic agreements are required
Legal risks must be addressed
Provide greater scale of data, with quality
Competitive advantage, somewhat limited

Third Party Data:Data collected by external entities, often aggregated from multiple sources, to provide broader audience insights.

Comes with an acquisition cost
Provides scale, but with lower quality and reliability

Brand Safety and Ad Fraud

Transparency, brand safety and measurement are becoming increasingly important and are now a shared concern between supply and demand, programmatic advertising, while efficient, is also susceptible to ad fraud and brand safety issues. To protect your brand or campaigns, verification tools are available to ensure that ads appear in brand-safe environments.

Strategies and optimizations

Within programmatic advertising campaigns, strategies are differentiated based on key campaign KPIs (awareness, performance, engagement, viewability…etc), taking into account the user’s navigation within the site and where in the funnel we want to work.

Once your campaigns are live, continuous optimization is key to scaling your programmatic efforts across multiple dimensions and metrics, such as:

Audience Segmentation: Further segment your audiences and deliver more personalized ads.
Frequency capping: Limit the number of times your ad is shown to the same user to avoid ad fatigue.
Viewability: Viewability refers to the measurement of whether an ad is actually visible to the user on a web or application and is considered visible if it appears in the user’s browser and at least 50% of the pixels are visible for one second. That is, it must appear on the screen for one second or more.
CTR: (Click-Through Rate) is a metric that measures the ratio of users who clicked on an ad to the total number of times the ad was displayed (impressions). It helps to measure the effectiveness or the engagement of the ads.
Conversions: Actions a user takes after interacting with an ad that align with campaign goals.
Bid adjustments: Refine your bids based on the KPIs.
Pacing of the campaign: How the budget allocated to the campaign is spent depending on the type of pacing chosen (even, ahead, asap).
A/B Test Ads:Test different creatives, headlines, and calls-to-action to see what works best.

Segmentation possibilities (Audiences)

Within programmatic advertising we have multiple targeting options to impact the right user at the right time in order to make the campaign more effective, for this, we have segmentations such as:

Demographic Targeting: Focus on age, gender, income, education, etc.
Behavioral Targeting: Use user behavior data (e.g., past purchases, browsing history).
Contextual Targeting: Place ads within relevant content (e.g., place an ad for a fitness brand on a health website).
Geolocation Targeting: Deliver ads based on a user’s geographic location.
Retargeting: Show ads to users who have previously interacted with your brand.

More and more ad formats in programmatic

There are a growing number of formats that allow advertisers to create customized and engaging ads that are tailored to the specific needs of their campaign and/or audience.These include the following formats:

Programmatic Display & Video: are diverse and versatile, catering to different types of user experiences and campaign goals. The main types of display & video ads used in programmatic are designed to reach users on websites, mobile apps, and across devices. You’ll find these ads in a variety of shapes and sizes, and they can be either moving or still. You want to reach the largest number of users on premium sites.
Interactive Creatives: Awareness and engagement that is 100% customizable and measurable. Display ads that offer users an interactive experience that allows them to engage directly with the ad content. These interactives can include polls, games, quizzes, sliders, product carousels, or AR experiences.
DOOH (Digital Out of Home): Digital outdoor advertising, such as digital billboards, transit displays, and screens in high-traffic areas like shopping malls, airports, or stadiums. Engaging content in real time with the flexibility and targeting capabilities of programmatic.
Audio: These ads are typically served in digital audio environments such as streaming music services, podcasts, Internet radio, and voice-activated devices (e.g., smart speakers). Programmatic audio uses data to target specific audiences and deliver ads in real time.
CTV : Provides advertisers with the ability to deliver targeted video ads to audiences viewing content through on-demand services, streaming platforms on smart TVs or over-the-top (OTT) devices.

The rise of streaming and on-demand content consumption has made CTV a powerful advertising channel, offering the precision of programmatic targeting with the broad reach of television

In conclusion, knowing and understanding the programmatic ecosystem and all of its capabilities is critical to the success of future advertising campaigns based on data-driven targeting and continuous optimization, as well as maximizing campaign impact with increasingly spectacular formats.