What is Programmatic Advertising and How to Do it Right in 2022

8 Feb , 2022

Programmatic advertising is getting familiarized by digital marketers, and so should you. In today’s digital era, big data intelligence is driving all the digital marketing strategies. By the end of 2020, programmatic ad spend was worth 129.1 billion US dollars which is contributing over one-fifth of the total ad spend globally. The figure is expected to be heightened up to 155 billion this year with the US market projected to have 88% of all its digital display ad dollars spent on programmatic advertising. Shocking number, isn’t? This is why we are here with this latest digital marketing insight to talk about programmatic advertising and how to do your programmatic advertising right in 2022!

This digital marketing insight includes: 

1.        What is Programmatic Advertising 

2.        Benefits of Programmatic Advertising 

3.        How to do programmatic advertising right in 2022

1. What is Programmatic Advertising 

Back in the day, advertisers had to choose amongst the oversupplying publisher sites, negotiate and trade with the sales team for ad space. Everything was done manually which, you can tell, was time-costing and much of a nuisance to the advertisers to go through the process whenever they needed an online advertisement. Moreover, an agreed manual digital advertising allows the advertisers to take over the ad space for a certain period of time. In terms of ad delivery, it really was not an effective digital marketing strategy that the ad would always be there regardless of the visitor who might not be interested in it at all.

The appearance of programmatic advertising has taken online advertising to a whole new level. Briefly saying, programmatic advertising is the automated buying and selling of online advertising space in real-time. It has connected to a variety of publishers and advertisers with established ad inventory and database, and streamlined the entire media buying process automatically, offering a way more cost-effective alternative to traditional online advertising. So how does programmatic advertising work?

Suppose you would like to run a programmatic advertising campaign so you approach a digital marketing agency with programmatic advertising services like us. The agency gets the campaign detail and KPI from you so that it can utilize the information in a Demand-Side Platform (DSP) to automate the media buying process for you. On the other side, publishers use a Supply-Side Platform (SSP) to manage and offer their ad inventory. With audience data supported by a Data Management Platform (DMP), DSP and SSP respectively allow the right publisher and advertiser to meet and trade for a successful programmatic advertisement in an ad exchange. It looks like a lengthy process but in reality, programmatic advertising delivers ads in milliseconds. It is more sophisticated than you think with automation and artificial intelligence (AI) technology involved.

2. Benefits of Programmatic Advertising

The word “programmatic” has scared away some advertisers who perceive programmatic advertising as a complicated, costly digital marketing strategy. Although it does fully utilize advanced digital technology that may not be familiar to you, it is what programmatic advertising is worth being part of your media mix! Read on to know the three most notable benefits of programmatic advertising.

2.1 Programmatic advertising maximizes reach

Who doesn’t want their campaigns to reach as much of their target audience as possible? It is safe to say that ad efficiency is highly determined by audience reach at scale, and programmatic advertising achieves this for you. As the ad exchange connects to multiple ad networks where millions of publisher sites of different niches gather, advertisers can easily purchase the suitable ad inventories at scale and find a large group of the target audience.

On top of this, programmatic advertising allows advertisers to reach their audience wherever they are across digital media channels, i.e. social media, audio, Connected TV (CTV), Over-the-top (OTT), online press/ publishers, Digital out of Home (DOOH), etc. With behavioural data utilized, programmatic advertising performs a true omni-channel digital marketing strategy which maximizes your reach.

2.2 Programmatic advertising achieves higher ROI

Programmatic advertising has the most powerful characteristic in its precise audience targeting. Besides the common targeting such as demographics, interests and behaviour, it can perform location and weather targeting in real time!

The DMP collects, stores and sort real-time data to fuel the media buying decisions so that the best audience for the programmatic advertising campaign can be identified. The ad can be displayed to the most relevant audience at the right time, the right location and even the right weather!

In addition, there is more flexibility offered to the advertiser as real-time adjustment to the programmatic ads is allowed. Not only is the ad personalized to each audience, the campaign performance can also be optimized with the real-time data. No more guessing game in audience targeting leads to higher ROI of your campaign.

2.3 Weather-based programmatic advertising is surprisingly effective

Weather targeting in programmatic advertising may look like a small strategy but in fact works like a charm in many cases! Based on the local temperatures, other weather conditions and location data, the weather targeting uses machine learning to forecast the consumer demand under different environments. It empowers advertisers to influence consumer behaviour by showing up to the potential customers before they even realize they need your product and service.

Weather affects our activities and mood profoundly. Think about it: on a hot summer of 38°C, you would not be interested to see the advertisement of thick bomber jacket even though it is stylish and on sale. In contrast, an advertisement featuring hotpot will excite you when the temperature drops to 15°C in one night. Just from these two simple scenarios, we can see that weather targeting is actually very practical in industries like clothing, FMCG and many others. With instant geo-location and current condition data, brands can leverage weather triggers to reach the right consumer who are mostly likely to resonate with the ad message.

Proven example is from Pantene, the hair care products brand. After experiencing the fall in sales in 2003, Pantene utilized weather-based programmatic advertising to promote their products in dealing with people’s “bad hair days”. Weather triggers are identified by the humidity and dry heat conditions to deliver ads with discount coupons and store direction which drive back sales for Pantene.

2.4 Programmatic advertising is automated but under your control

We mentioned how programmatic advertising is more intelligent and efficient compared to the traditional media buying process that most of the human work is eliminated. Humans can be biased but machines are data-driven constantly, ensuring the programmatic ads’ reliability. Some advertisers are worried that programmatic advertising will react too fast to the market that the campaigns would be out of control once it is launched. Nope! In regard of the automated process, it still requires your well-prepared strategy planning and decision making at times. Moreover, the latest programmatic advertising technology offers way much greater transparency of the actual media buying. Advertisers would no longer be left in the dark about the ad placement and performance data. Instead, you will be well-informed to make sure the programmatic ads are reaching your intended target audience and achieving your KPI goals in a safe condition.

3. How to do programmatic advertising right in 2022?

3.1 Allocate more budget to programmatic CTV and OTT advertising in 2022

When you realize the skyrocketing growth of video marketing, you kind of know that programmatic video advertising is worth diving into! It is predicted that the programmatic ad spend will hit $43 billion US dollars next year. Two of the main video channels are CTV and OTT.

Both devices are similar but CTV, Connected TV, connect to television without traditional cables while OTT, Over-The-Top, delivers video content from the internet. Platforms include Apple TV for CTV and Netflix for OTT. Under the ongoing pandemic, CTV and OTT become the fastest-growing media channel this year without surprises. More consumers are willing to pay for these video services, e.g. OTT subscription has an increase of 41.2% last year. Therefore, advertisers had increased their programmatic video ad spend as well.

Taking CTV as an example, it had a 48.6% increase in CTV ad spend this year with display ads showing on the CTV’s home screens and in-stream video ads. Although it is expected to have less increase in ad spend considering the world is getting back on track, the total CTV ad spend is still growing ascendingly. The positive trend encourages advertisers to allocate more budget to programmatic CTV and OTT advertising in 2022 in order to compete with their competitors on this popular media channel.

3.2 Consider planning for programmatic DOOH in 2022

Out-of-home (OOH) is nothing new as an advertising strategy. But when you actually think about it and even Digital-out-of-home (DOOH), it may put you off by its cost, lack of flexibility and data. Luckily, we have programmatic DOOH nowadays. With more inventories available across countries, savvy advertisers have changed from having only 2% of them purchasing programmatic DOOH to expressing their increasing interest in it. We also believe programmatic DOOH is one of the future digital marketing trends perceiving its rising accountability as an outdoor advertising format and capability to optimise advertisers’ omni-channel marketing strategies.

Last year, Kam Kee Café is the first adopter to have launched the Hong Kong-first programmatic DOOH campaign at the Hong Kong International Airport. Everyone knows that the airport is totally not bustling like the old days due to COVID-19. However, it happens to be the prominent location to place programmatic DOOH ads concentrating on the inbound travellers who have not visited the city for a long while and are easy to convert. Kam Kee Café ran its programmatic DOOH campaign which has displayed ads at two locations in the airport. It targeted the arriving passengers after 2pm to draw them to visit the Kam Kee Café at the airport.

Not only did it attract the travellers to visit the airport store and stores around Hong Kong, but also raise the brand awareness towards Kam Kee Café. The restaurant has successfully received good programmatic advertising performance with the precise time of time and geographical targeting as well as the attractive campaign creatives. The power of programmatic DOOH advertising should not be underestimated.

Summary

In a nutshell, programmatic advertising will only continue to grow in 2022 offering you more incredible opportunities charged by its real-time automation, targeting capabilities and data-driven performance. It is no brainer to not give programmatic advertising a go. Yet, be careful that without tailored and strategized ad content, even if you can trade millions of ad impressions with the right targeting, your programmatic advertising campaign will not reveal its true potential. AsiaPac, as a full-service digital marketing agency, can clear your doubts about your programmatic advertising strategy and do all the hard work for you.

About AsiaPac Net Media

With an extensive digital marketing experience of serving more than 2,500 clients across Asia in sectors such as ecommerce, finance, gaming, travel, retail, beauty, FMCG, education, health products, AsiaPac’s expert team is highly recognized for the excellence in providing performance-driven services to businesses across Asia, and global corporates targeting Asia markets. If you’d like to learn more about AsiaPac and the work we’ve done, visit our Case page. For more information on AsiaPac/ AdTech and our services, please contact us at info@asiapac.com.hk /info@adtechinno.com.