Programmatic ad buying has transformed the online advertising landscape forever, but there remains a slight lack of clarity around what it actually entails.
What is programmatic?
“Programmatic” ad buying generally refers to the use of software, more specifically an algorithm, to purchase digital advertising, as an alternative to the traditional process that involves human negotiation and manual buying. It’s using a machines to buy online ad space, essentially.
Why is programmatic significant?
One word: Efficiency. Prior to programmatic marketing, digital ads would be bought and sold manually through media buyers and/or sales teams, both of whom can be costly or unreliable. Programmatic advertising tech promises to shift the ad buying system towards greater efficiency, making it less costly, by erasing human interface from within the process wherever possible. Humans get ill, require sleep and come to work feeling the effects of the night before. Machines have none of these problems.
So robots are taking the place of humans? Glorious.
The correct answer to that question is both yes and no. Tech is being utilised in an attempt to replace some of the more lowly tasks that people have had to do throughout time, such as sending an insertion order to publishers and handling ad tags, but they’re still made to optimise campaigns and plan strategy across the board. Programmatic tech will likely mean there are less ad buyers across planet Earth, but it could also open a door of opportunity for marketers and sellers to use more of their time strategising and planning sophisticated, personalised campaigns as apposed to getting pulled down in bureaucratic issues.
So…does that mean programmatic buying is the same as real-time?
No, they are not the same. Real-time bidding is a form of programmatic ad buying, but it’s certainly not the one and only. RTB is the purchase of ads during live online auctions, however programmatic software allows advertisers/brands to also buy definite, guaranteed impressions ahead of time from precise publishers. This type of buying is often called “programmatic direct.”
Is programmatic the future?
Almost certainly. The stats, some of which are detailed in our programmatic advertising page, seem to point strongly in that direction. It’s difficult to tell accurately what slice of the advertising pie is now spent programmatically, but it’s undeniably on a huge upward curve. Various agencies now say they are looking to acquire as much media as is possible using programmatic methods, and some giant brands have even been building in-house teams to manage their programmatic ad spend as they use more and more of their budgets through these means. As it stands, it’s mostly online ads that are traded programmatically, but more media businesses are looking into solutions to sell “traditional” media in the same way, including TV and out-of-home advertising.