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What is Programmatic Advertising?

Programmatic Advertising refers to buying Digital advertising space automatically, where computers use data to decide which Ads to buy and how much to pay for them.

Programmatic boils down to the use of data and technology enabling marketers to make decisions in real time about the advert they want to deliver to the consumer.

There are four pillars to programmatic success – Data, Inventory, Technology and Expertise/knowledge/resource.

Agencies and programmatic businesses will dial up on all four of these areas and take the risk away from advertisers.

The promise of programmatic is that it makes advertising more targeted and therefore relevant and it makes buying more efficient. Using technology and data to automate media buying, makes it easier and cheaper for a brand to reach its target audience.

Here we are thinking about the audience that we are trying to reach, on what kind of day, at what scale, on which recency time and increasingly, on which devices. We look at what we know about them demographically and behaviorally based on the individual’s internet consumption habits over time

So, for example, rather than buying a million impressions on The Telegraph in one go and committing to that over a period of time, a brand can buy a million impressions split across multiple publishers or media owners, targeted at a particular audience segment.

How we use data more effectively for programmatic?

Having an understanding of the behavioral insights that can be drawn from data is the first step to achieving an efficient programmatic strategy.

There are three tiers of data to consider.

First-party data is the advertiser’s own data about their customers, while second-party data is collected by someone other than the advertiser, such as an agency, who shares this data with the brand to help structure the programmatic strategy. Third-party data is available to anyone at a cost and is usually sold on a rate card basis.

We should think about data as customers or potential customers. Sending existing customers messages about upgrades or new product offers is known as re-targeting. To grow beyond that point, we use data to find new prospects, looking for similar audiences/look alike audience to the existing customer base. We look at the data and how existing customers are behaving on the internet, and then we look for people exhibiting similar behaviors as a customer in the future.

We need to start talking about programmatic in a language that makes sense. Once we do that, we can become more transparent from all sides to the client.

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