The way advertising and display media is being bought and sold is changing, and the change is happening fast, particularly with the growth of programmatic media buying.
Programmatic media buying is the process of buying media based on predetermined algorithms and systems. Kind of like buying ad space, but using artificial intelligence robots and programs to do so. It can be further characterised by the following:
- It utilises buying via bidding across an inventory of available media
- It is conducted through a Demand Side Platform (DSP)
- It’s conducted in an exchange (advertising exchange network)
- It’s conducted in real time (or as close as possible to ensure that this entire process all happens very fast!)
- It shows one tailored advertising message to a specified user
Programmatic media buying is also dependent on what we know about the user by interpreting their content and incorporating the device they are using at a certain point in time.
The move to programmatic buying will reshape the media landscape, but not all agree. At ad:tech Sydney last month, some senior media agency figures scoffed at claims that 70% of media will be bought programmatically within 5 years. They may very well be right. However, even if the shift falls short of the 50% mark, the shift to programmatic is certainly still changing the game dramatically.
Better media channel performance attribution
Personally, I see the shift to programmatic media buying as a great opportunity for better attribution of performance to the different media channels. No longer will digital be the only media that has to explain the ROI it achieves. No longer will we need to deduce the performance between search, display, EDMs, and social etc. Well maybe we will, but it’s a big step forward.
Additionally, the marketing that we serve (and receive) will need to be more targeted to me as an individual, in my current context and accounting for the device I’m currently using. If we don’t develop tighter targeting in our marketing initiatives, then the performance we achieve won’t be as good as our competitors. Logically, poorer performance than our competitors won’t lead to the outcomes that any organisation desires.
How to prepare for the shift to programmatic media buying
So how can you prepare for the change and capitalise on the opportunity presented by the shift to programmatic buying?
1: Ask you agency how they are preparing your business for this change.
2: Allocate budget to get tests underway ASAP – 10-15% is a good starting point.
3: Understand the connections between your various marketing channels. Physically map out the marketing paths that your customers are starting to follow.
4: Plan your customer segments – who do you want to talk to? Once you have fragmented them, then add another level of depth.
5: Ensure you have processes in place to capture the data that gets generated via your marketing initiatives to drive future marketing campaigns.
Additionally, its worth calling out that programmatic buying will extend to TV, radio (digital), billboard and OOH media, cinema advertising and beyond.
So the change is happening and it’s happening fast!
Here are a few useful blog posts if you want to learn more:Andy Jamieson Filed in Business