10 Things Every Marketer Should Know About Programmatic Display

Tips to Consider When Sizing up Programmatic Partners

Today’s display advertising ecosystem is crowded with agency trading desks, ad networks, exchanges, retargeters and demand-side platforms, all of them trying to stake a claim on the real-time marketing game. These platforms leverage technologies like real-time bidding, dynamic creative optimization, user targeting and segmentation to help advertisers reach the right audience, at the right time, with the right message and for the right price.

With such a busy marketplace, many marketers might be left wondering which criteria they should be checking when trying to determine the best possible partners to help them reach their goals? Here are ten important points that every marketer should consider when sizing up programmatic partners.

1. Programmatic display is about more than just buying.

Real-time bidding (RTB) is just one small piece of what is potentially a very big programmatic technology pie. In order to place an intelligent bid for a given impression, marketers and their technology partners must take into account hundreds of data points that can range from the user’s on-site behavior to historical CRM data to the time of day, or even the weather! But buying isn’t the only role for programmatic technologies in display advertising—some programmatic partners also make it possible to automate the optimization of the display creative itself. This is called “dynamic creative optimization,” or DCO, and it can entail user-level optimization of everything from the call-to-action to the products shown in a display banner.

2. Not all programmatic technologies are created equal.

In programmatic display, “bid volatility” is a term that refers to the number of variations in all of the bids submitted by a given buyer (demand-side platform or trading desk). According to our ad exchange partners, bid volatility in RTB can range from anywhere as low as one bid variation (for example, bidding a flat bid price for every user who visited an advertiser’s web site) to more than 16,000 bid variations for a single campaign. The same level of granularity can be applied (or not) when it comes to messaging, with some platforms only showing the same static creative for every impression won, and others showing dynamically optimized creatives with offers customized down to the user-level.

3. When it comes to “big data” in programmatic, get smart by tapping your structured data first.

Programmatic runs on data, and while big data has the potential to bring a lot of value to this channel, it takes a lot of work to make unstructured data—the bulk of big data today—usable for the purposes of online marketing. That said, many marketers are already sitting on other sources of data that are already structured and ready to be put to use in programmatic and other marketing channels—we like to call this smart data. Smart data could be anything from existing CRM profiles to revenue and yield management data about products or offers. Before you make the investment in untangling big data, make sure you’ve taken the time to leverage existing structured data assets to the fullest extent—now that’s a smart data strategy!

4. Leverage segmentation to treat different user groups differently.

Marketers can increase the efficiency of programmatic buying using segmentation, which allows them to assign different performance targets (e.g., cost-per-action or ROI targets) for different user groups, based on the potential value of each group. The most basic segmentation might be between new versus existing customers—most advertisers would be willing to invest more to acquire new users and programmatic can make that possible in real time. Existing customers can then be further segmented—for example, using the same CRM logics that are used to segment email campaigns—to fine tune investments based on variables like customer lifetime value (CLV).

5. Give your programmatic system time to learn.

Programmatic display platforms are often described as “self-learning,” but in fact, in this context, “learning” only describes a machine’s ability to aggregate data and then recognize and act on patterns that surface within that data. In order to best identify user behaviors and make intelligent buying and messaging decisions, programmatic systems need to aggregate data over time, so make sure you’ve given your campaign adequate time and volume post-start to do a proper analysis of the results. The amount of time or volume needed for a “ramp-up” period will vary depending on the size of your campaign and the performance targets you are trying to reach, but in general you should wait until you’re able to achieve a stable performance (barring major external influences) before judging a campaign too fast.

6. Invest in sustainable, user-centric programmatic practices.

With all this talk of real-time, it can be easy to get caught up in the moment when it comes to programmatic. Unfortunately, when you forget to look ahead of the next view, click, or transaction, you run the risk of over-exposing your most valuable users! This is why features such as user-individual frequency capping, which makes it possible to limit the number of ads shown to a given user for a given period of time, are imperative when it comes to programmatic buying. Without this user-centric approach, you run the risk of burning out some of your best customers.

7. Make sure your dynamic ads are Flash-free to reach mobile devices.

Mobile is top-of-mind for nearly every e-commerce marketer, which is why mobile-compatible ads formats should be, too. Over the last decade, many dynamic banner ads were built using Adobe Flash, but unfortunately this proprietary technology can be quite limited for marketers—firstly, because it requires the installation of a browser plugin, and secondly because it is not compatible with Apple’s iOS devices. That’s why there’s been a major shift in the industry towards more device-agnostic banners built with technologies like HTML5. If mobile matters to your business—and it should—then be sure that your programmatic display partner is building banners that are mobile-friendly.

8. Look above and beyond the lower funnel.

While programmatic might have earned its stripes as a performance and retargeting channel, today’s most advanced marketers are also leveraging the benefits of programmatic for reaching users through the entire path to that first purchase, and beyond. The most intelligent bidders on the market are using automation to adapt messaging and investment strategy as each user passes through different stages of the customer lifecycle, from acquisition to conversion to retention and even on to advocacy.

9. Mobile programmatic pioneers have much to gain.

Users who shop on your site across multiple devices are often shown to have higher lifetime value, which is one reason why mobile advertising has become a top priority for many e-commerce market leaders. When it comes to mobile programmatic, there is (for the moment) less competition than on desktop display, which means that in many cases, marketers can reach the same users for a lower price than they might be able to reach them for on desktop. If you have access to technology that allows you to reach users on mobile web and in-app, then there’s no reason that you shouldn’t be able to extend your entire programmatic strategy—bidding, messaging, segmentation and targeting—from desktop display to mobile.

10. You still need a human touch when it comes to programmatic strategy.

For all the reasons listed above, it’s clear that no programmatic strategy is complete without the experience and expertise of seasoned specialists with a knack for data-driven strategy. With so many potential variables on the table, it can be difficult to know where to start. Even the world’s most “intelligent” programmatic platform is useless without the knowledge of how to leverage the technology, so don’t forget to invest in people, too.

All in all, just make sure to do your programmatic homework, and you’ll be able to differentiate your business and drive incremental revenues from this powerful data-driven channel.

Perplexed by any of the terms used in this article? Then be sure to download our Programmatic Jargon Buster to get up to speed on the latest industry terms.