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Programmatic Advertising 101: What You Need to Know

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Brad La Pointe
Programmatic Advertising 101: What You Need to Know
Programmatic Advertising

Programmatic Advertising 101: What You Need to Know

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Programmatic Advertising 101: What You Need to Know

Insider Intelligence reveals that nine in ten digital display dollars will be spent on programmatic ads this year. That’s because of their potency. It is driving better results and faster than a human touch can do.

If you want to skyrocket revenue this year, you need a crash course in programmatic advertising 101. Lacking digital marketing skills could even put you out of business because you know your competitors are leveraging programmatic ads. You can be in as many digital spaces as you want to, and while it is running, you can sit back watching the results.

This gives you the power to see where you can make changes on the fly, something snail mail could never offer.

Get ready to give sales numbers a boost. Here’s how.

What Are Programmatic Ads?

This is digital advertising that you buy using the software. Traditional TV and commercial advertising use tenders, quotes, proposals, and negotiation methods. Programmatic ads use algorithmic software to sell and buy display space online.

Programmatic advertising is sophisticated. It uses online display targeting and traffic data at scale to drive impressions. This leads to higher ROI for digital marketing professionals.

Still, the process is not all automated. Marketers must add tags and prepare the insertion orders. This can be an uphill task.

A benefit to programmatic ads is that marketers can devote time to optimization. This directly impacts the success of campaigns.

Why Programmatic Advertising Is Successful

The worldwide market for programmatic advertising increased from $7.31 billion in 2022 to $8.87 billion in 2023. This is a CAGR of 21.4%. It is unique to boost brand awareness and drive more profits.

As popular as programmatic ads a becoming, you need a thorough understanding to reap its rewards. Inside Radio reports that 23% of dollars used in programmatic ad campaigns are wasted.

Programmatic advertising is efficient with resources and time. No longer must organizations rely on old-school hit-or-miss campaigns, which cost way too much anyway. That is because algorithms decide where the best area to spend money is.

Human marketers are responsible for the information they input. You must feed your audience details about the campaign and KPIs. The algorithm handles the rest.

Know Your Market

Before you let the algorithm go to work, you must do some human research and strategizing. There are many new terms in programmatic ads and plenty of creative ideas. It would help if you got acquainted with it.

For instance, you will need an understanding of the difference between SSP and DSP advertising. SSP is a “supply-side platform,” which is software for publishers. They use it to facilitate the sale of advertising impressions.

DSP advertising is the “demand side platform.” It is an automated platform for ad buying where agencies and advertisers can buy digital ad inventory.

Set Your Goals

There are many aims in these campaigns. Choosing two or three metrics is the best way to set an objective. You can focus on reach, awareness, number of site visitors, conversions, etc.

Once you have your digital objective, business goal, and key metrics, you will choose your KPI. This is how to drive performance. Well-planned programmatic advertising produces full-funnel results.

It starts with awareness. Then it moves to traffic and consideration. Finally, the programmatic ads work to elicit an action.

Awareness KPIs

When awareness is the objective, marketers have two goals. First, they wish their advertising to reach as many audience members as possible. The best way to measure it is by CTR (click-through rate) or CPM (cost-per-thousand).

Second, awareness means communicating key differentials, a new product, brand history, etc. A brilliant way to measure this KPI is by ACR (audio completion rate) or VCR (video completion rate).

In this aim, KPIs are not measured to control the cost but instead focused on communication. It is not about efficiency, but reach.

Traffic/Consideration KPIs

Here, there are also two goals. One is that marketers are increasing consideration. They want their key customer base to remember this product, message, or brand. CPCV (cost-per-completed view) can measure this.

The other goal is to drive a customer to a specific land page. CPLPV (cost-per-landing page visit) or CPC (cost-per-click) measures this.

Conversion KPIs

This has one main goal. That is to drive your audience to complete an action. It could be downloading a visitor guide, buying something online, visiting a brick-and-mortar location, or requesting additional information.

With conversion KPIs, you must control the cost. That is to maximize the number of actions users take. There are multiple KPIs to help you, including:

  • CPA (cost-per-acquisition)
  • CPLPV (cost-per-landing-page visit)
  • CPVWI (cost-per-verified walk-in visit)
  • ROAS (return-on-ad-spend)

Some programmatic advertisers use the number of conversions. Although it may not be the best because while it counts the number of actions, it does not consider efficiency. You must measure your efficiency, or you could drive the cost of your programmatic ads up too high.

Watch Out For Digital Ad Fraud

Even programmatic ads can be a target for scammers. Like other areas of digital technology, fraudsters are developing and becoming more cunning by the day. You want to look for fraudulent traffic that generates fake impressions, negatively affecting the CTR.

Other types of online advertising fraud include:

  • Ad injection
  • Ad stacking or “invisible ads”
  • Click and device farms
  • Domain spoofing
  • Hidden advertising
  • Pixel stuffing (reducing the ad size to one pixel)
  • Source of fake traffic
  • Throwing in cookies

Ad fraud drains ad display resources, so it is essential to watch for it.

Programmatic Advertising 101

When you want to grow your business, you need digital technology to help you. Customers learn about your business online. It is essential to understand the programmatic advertising 101 basics.

Then, look to the ORION trade side platform. Performance marketers love ORION because it gives them everything they need to generate high ROI for their campaigns.

When you are ready to raise the roof on profits this year, contact the experts at Version2 and ask them about programmatic advertising with ORION.

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