Programmatic Buying: What It Means for Digital Marketers

Programmatic. You may have heard it in a digital planning meeting, seen it in a media plan or nodded your head when brought up in conversation, all without really understanding it. I’ll be the first to raise my hand and admit I was guilty of all of the above.

That changed this summer when I participated in a six-week digital marketing and professional development training at Google called Squared. As a cohort of trainees, our final project was to host a Hangout that answered:

“If the future is programmatic,
then what is our role as marketers?”

By definition, programmatic means using technology and audience insights to automatically buy and run a campaign in real time, reaching the right user online with the right message.

What does programmatic really mean?

As we know, there are nearly a trillion websites on the Internet with space (inventory) to house advertisements (display ads). Back when this number was much smaller, publishers sold inventory directly to advertisers. Today, that would be impossible to execute manually, which is where programmatic buying comes into play.

How is programmatic executed?

Instead of each publisher being in charge of its own inventory, an Ad Exchange houses a conglomerate of online inventory. Advertisers, agencies and ad networks looking to purchase inventory work with a DSP (Demand Side Platform), which facilitates the purchase through the Ad Exchange. Much like paid search, DSPs automatically buy online inventory based on set brand KPIs with extensive targeting capabilities. This way of buying, programmatically, allows marketers to reach their target audience no matter where they may be online. The list of targeting capabilities includes:

• Demographics
• Geography
• Interests
• Behaviors
• Time of Day
• Weather
• Device

For example, let’s say a cruise brand wants to reach people online who live in Chicago and like to travel. An ideal time to advertise to these people may likely be when it’s raining and during their commute home. Programmatic buying allows this cruise brand to get as specific as reaching people -living in Chicago, -interested in travel, -are on a mobile device, -when it’s raining, -from 5-7 p.m. and target them with a display ad. Therefore, programmatic focuses less on inventory and more on reaching the right consumer wherever they’re consuming content online.

Why is programmatic beneficial to marketers?

Even with this new way of buying display ads, there’s still a huge desire to be in control of where they run online. As marketers, we need to switch our thinking to be less worried about which websites our ads appear on and care more about reaching the right audience. When we buy programmatically, we can be assured that our message will hit the right consumer. It also opens doors to a whole new variety of ads that move beyond traditional displays. Here’s a great example of how Nike used programmatic to engage fans with a custom social card when Nike athletes scored goals during soccer matches.

As we move into a programmatic mindset, we’ll have to become better data scientists and better storytellers of how data is communicated. If the future is programmatic, then I predict that it will become channel agnostic. TV, print and digital out of home will all be bought programmatically and geotargeting during culturally relevant events will be even more essential to brands.