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Programmatic advertising: what you need to know

Nathan Warner Tuesday, 28 April 2015.

You may not have heard of programmatic advertising, but you've certainly been been affected by it.

Programmatic advertising is a broad-ranging term that covers many technologies used to automatically buy advertising space and choose where adverts run – without human intervention.

Just five years ago, the number of adverts on the internet that were sold programmatically was next to none. But driven by the development of complex algorithms and real-time big data analytics, today an estimated 20 percent of online ads in the US and Western Europe are programmatic. Underpinning this growth is the proliferation of mobile usage.

However, programmatic advertising is still in its infancy and this form of promotion comes with several potential pitfalls. So how can you avoid these and make best use of this technology for your business?

Dealing with complexity

Innovation and integration within the mobile industry are transforming the consumer experience. As users rely on their smart phones to pay their taxi fares, order their groceries or purchase theatre tickets, mobile advertisers are increasingly faced with an overwhelming number of options as to where their adverts can appear.

Real-time bidding, whereby advertisers purchase a given quantity of ad impressions on a website in advance at fixed price, has allowed advertisers to target consumers more accurately – increasing effectiveness and avoiding wastages. Programmatic delivery works with huge volumes of data, and increasingly can target people according to their location, unique preferences or current activity.

While this means companies that advertisers stand to benefit from higher click-through rates and ultimately, higher sales, they risk becoming a nuisance to the user and consequently damaging their brands. Without a human being involved in the decision where an advert is placed, they may become badly targeted, and seen as spam – driving consumers to block them.

Going back to basics

Data driven purchasing of advertising space is so prolific that many users are overwhelmed with insistent and often irrelevant content – there are simply too many adverts. But the problem does not just lie with the technology. Instead, in their rush to abandon traditional advertising, many companies and agencies have take a 'quantity over quality' approach and have forgotten the basics of creating good, relevant and considered content.

To achieve this requires the skills of an experienced advertising professional, combining his or her creativity with technology to deliver first class campaigns which might include, for example, a movie trailer targeted to film lovers who are near a particular cinema in the run-up to the show time. This could be tailored by profiling users to find out their favourite genre or actor. But the quality of the campaign is paramount: relevant content encourages brand engagement and enhances the user experience.

Ad technology has come on in leaps and bounds over the past decade and the future of mobile is very promising. But we cannot over rely on technology. Instead, we must learn that at the heart of an effective mobile advertising campaign is a consideration for the consumer and creativity, which only people – not computers – can bring.

By keeping human intelligence at the heart of your advertising decisions, you can ensure that your messages are seen by the right consumers, at the right time, and in the right place – so they will achieve the best possible results.

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Nathan Warner

Nathan Warner

Co-founder and Director, Mapp Media
Mapp Media specialises in cross-platform advertising with a focus on mobile, app and tablet. It works with leading, innovative platforms to deliver effective and engaging advertising.

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