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What Is The Deal With Programmatic Buying?

By:Gabriel Cohen10/30/2014

I see a million articles, videos and infographics explaining programmatic buying for dummies, or the simple explanation for programmatic buying. Well, I’m going to give you one more. Not for dummies, because I don’t think a dummy can truly grasp what an incredible world is now available for media buyers, marketers and businesses. Not a simple explanation, because it’s not simple. Anyone who says it is doesn’t fully understand programmatic, and you should run in the other direction.

 

This is an introduction to the wonders of programmatic buying.

 

Ads. Media buyers have ads to insert online – just like a print or TV spot insertion. Publishers have inventory they need to fill. With the millions of impressions available on the web, can you imagine if every media buyer had to submit an insertion order for every impression? Imagine the frustration.

 

Programmatic buying is the automation of buying and selling ads. Simple? Simple definition. Complex execution.

 

Now a media buyer has the ability to take a particular ad, set parameters and use computer algorithms to maximize access to publisher inventory, better pricing, and accurate audience optimization. Media voodoo? Science fiction? It’s here, and we can do it in real-time.

 

The advertiser puts thead into a DMP (Demand Management Platform), and sets the parameters. These parameters are set according to geographic location, income level, demographics, purchasing habits, or any number of factors a media buyer choose for that particular campaign. How do they know that ad is going to be seen by the people that meet their criteria? So happy you asked. Data-driven audience targeting is what makes programmatic buying so special and amazing. We have dozens of data partners utilizing online and offline data to accurately target the audience. Instead of buying media, we buy an audience and our data partners ensure that they are there when we show up. Our data partners are industry leaders in the field of data collection. We are vigilant about our reputation, and therefore we are vigilant about the data partners we use to ensure accurate ad placement.

 

So our ads are put in the DSP, which sends them to the Ad Networks where a custom exchange is created to offer the most appropriate inventory. The publishers have submitted their ad needs through their own platform, the SSP (Supply Side Platform). This now becomes Real Time Bidding (RTB) and works just like the stock exchange. Within milliseconds your ad bids against competitors in real-time based on the parameters you have set and the price limits you put in place. No wasted impressions and no overpaying for ads.

 

See? Not rocket science, but not exactly for dummies either. Why all the controversy? It’s a new technology and that pretty much comes with the territory, but even in the last six months significant improvements to transparency, software and inventory have been made. Most marketing experts predict programmatic is the future of media buying. You don’t have to tell us; we’ve been working on it for a while. Is it time to abandon ship with the rest of your media plans? Whoa buddy! That is exactly the opposite of what you should do. New technologies and outlets are great, but the key to success is embracing media fragmentation and understanding all media channels and their best usage. A holistic approach to any media plan is key to success, and programmatic is just one key component. We may be ahead of the curve on that, but that’s because we love buying media. There’s more than one way to crack an egg.


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