Programmatic marketing has revolutionized digital advertising over the past decade. It automates the buying and selling of digital ad inventory through an auction-based system. Instead of manual media buying, advertisers can use software to purchase digital ads in real-time to reach their target audiences.
As programmatic advertising grows more complex with new technologies and data capabilities, marketers need to take a strategic approach to stay ahead of the curve. Understanding the core components of programmatic and how to leverage data and technology effectively is key to running successful campaigns. fmcg companies
What is Programmatic Marketing?
Programmatic marketing refers to the automated buying and selling of digital advertising space. Rather than human media buyers negotiating placements manually, it relies on software, algorithms, and automation to purchase digital ads. Here are some key things to know:
– Real-Time Bidding
Programmatic transactions happen through real-time bidding (RTB), an auction process where ad inventory is bid on and purchased dynamically.
– Ad Exchanges
Programmatic transactions take place inside digital advertising exchanges which facilitate the buying and selling between publishers and advertisers.
– Targeting
Sophisticated targeting strategies are applied to reach specific audiences based on data points like demographics, interests, behaviors, locations, and more.
– Automation
The entire process—from bidding and purchasing to targeting, delivery, and optimization—is automated through specialized software and platforms.
Programmatic allows for precision, efficiency, and automation compared to manual media buying. Brands can reach their target customers with relevant ads in the moments that matter. Publishers also benefit from pricing inventory dynamically to maximize yield.
Why Adopt a Strategic Approach?
As programmatic marketing grows more mainstream, adopting a strategic approach is key to success. Programmatic provides efficient reach to desired audiences, but smart implementation is crucial.
Brands need a strategy aligned with business goals before activating the sophisticated tech stack that makes programmatic possible.
The most successful brands have a unified view among their teams on their programmatic strategy, aligning it with KPIs for their business and campaigns. They leverage data to inform decisions at each stage and actively manage partners/vendors involved for optimal outcomes.
Without strategic alignment, it’s easy to get lost in the weeds of the tech and lose sight of overarching goals. A sound strategy provides direction amidst an ever-evolving landscape.
It also allows you to course-correct effectively if needed. As programmatic capabilities accelerate, the brands that apply strategy to guide their efforts will continue winning.
Key Components of a Programmatic Strategy
When designing a programmatic strategy, there are a few key components to have in place:
Business Objectives
Having a clear understanding of your organization’s business objectives and how programmatic advertising can help achieve them is crucial. Connect your programmatic KPIs like reach, conversions, or target CPA to broader sales and growth goals. This alignment will guide appropriate investment and tactical plans.
Audience Insights
Apply audience insights to develop targeting strategies and creative approaches. Leverage existing customer data as well as broader market research on your segments’ media consumption habits and interests. Ongoing analysis will refine your understanding of the best contexts and messages to engage your audience.
Media Plan
The media plan details the channels, inventory types, and target contexts where your ads will run to achieve campaign goals. This is guided by audience insights—their content preferences, browsing behaviors, device usage, and ideal touchpoints to drive an action. Plans can evolve as campaigns run and data guides optimization.
Technology Stack
The technology stack includes the programmatic platforms and vendors you’ll use to execute media buying, run ad operations, ingest data, and deliver reporting.
Assessing the capabilities and limitations of various tech solutions is mandatory before deploying them to support campaign activation and measurement.
Data Strategy
A programmatic strategy centered around good data usage is crucial for targeting, optimization, and reporting. What datasets do you already have? What new signals will you activate? How will you consolidate, analyze, and act upon data? Building cross-functional data discipline ensures quality insights to drive outcomes.
Governance
Programmatic partners and vendors must align to execute upon strategy. Establish processes for working with agency counterparts and external vendors at each stage from media plan to activation, optimization, and measurement. Use contracts to guarantee transparency and service levels that support your programmatic advertising initiatives.
Ongoing Optimization
The technology of programmatic allows for always-on optimization as campaigns run. Set realistic campaign timelines with continuous performance assessments against your KPIs at regular intervals. Consistent monitoring means you can nimbly optimize tactics to improve results.
Employ These 5 Best Practices in Your Approach
In your programmatic strategy, be sure to employ these five best practices:
1. Establish Clear Goals and KPIs
Align programmatic metrics to business objectives like sales targets or growth benchmarks. This focus lets you build appropriate media plans and assess performance against what matters most.
2. Centralize Audience Insights
Consolidate customer and market data into a single view of your target audience for consistent messaging and experiences across channels. Shared insights empower better targeting.
3. Connect Strategy with Tactics
Let audience insights and media context drive your creative approach and messaging per channel. Align technical tactics to data-driven strategy for unified outcomes.
4. Control Tech Stack Complexity
Audit capabilities and limitations across the martech stack components being used. Set standards for critical functionality like tracking and analytics to simplify the optimization of integrated platforms.
5. Foster Cross-Functional Collaboration
Break down silos between teams responsible for data, media buying, creativity, and strategy. Shared KPIs and processes foster alignment on programmatic initiatives to help achieve collective goals.
Overcoming Key Challenges
While programmatic advertising drives massive efficiency, there are still challenges to overcome from a management perspective:
Fragmentation
The complex technology stack brings together disparate platforms. Marketers must seamlessly integrate layers of tech for planning through measurement while navigating gaps.
Lack of Transparency
There is often limited visibility into media supply chains and auction mechanics. This makes it difficult for brands to audit value exchanges happening, especially when using external DSP/SSP partners.
Data Management
As new data signals and inventory types continue emerging, it’s an ongoing effort to aggregate, normalize, and activate audience data at scale for targeting and optimization.
Increased Costs
Programmatic brings opportunities to efficiently reach customers amidst rising media costs across high-value digital inventory like social platforms and premium publishers.
Compliance Risks
Brand safety, viewability standards, and privacy regulations bring compliance stipulations to programmatic that require ongoing governance as the channels expand.
While the ecosystem brings complexity, the value generated from intelligent automation of optimized ad buying is truly compelling. Having an intentional strategy with the right pillars — goals, audience insights, media plans, data discipline, and governance measures — allows brands to maximize upside. Aligned teams will churn through the constant change happening across channels, tech, and regulations to drive performance.
Realizing the Full Potential
Programmatic advertising represents the future of digital media. The automated efficiencies it brings are indispensable now that attention is fragmented across devices and channels. With so much complexity though, realizing the full potential requires brands to double down on strategy.
The most successful brands will step back to align around business goals, consolidate customer insights centrally, create integrated media plans, and calibrate the supporting tech.
This strategy-led foundation allows them to navigate new opportunities on the horizon like Connected TV advertising, retail media networks, gaming environments, and more.
Programmatic will keep exponentially evolving, giving an edge to the organizations who evolve their strategy in lockstep.
In a polarized attention economy, the automated reach programmatic provides is extremely alluring. However, it is a strategy that will underpin the ability of savvy brands to architect the experiences that convert empowered consumers.
Aligning around strategic principles clarifies the way forward for teams to take advantage of all the possibilities programmatic has to offer.
