Programmatic marketing should be one of the most important tools in your company’s arsenal and yet it is one of the least understood marketing strategies.
Programmatic marketing is the term used to describe the practice of using automated bidding and placement platforms that buy and sell digital ad space in real time.
The decisions on the ad placements are made using hyper-specific data including the target consumers age, location, career, and specific consumer interests. This enables companies to launch hyper-targeted, extremely effective, ad campaigns that yield the highest ROI.
This allows businesses to target consumers across the full range of the internet. For example, if the algorithm determines that the most effective placement of the ad is on Facebook, then that is where it will be placed. If the algorithm determines that the most effective use of the campaign funds is to direct the ad to a more specialized website where there is a high concentration of targeted users, that is where it will be placed.
When creating a programmatic marketing campaign, the first step is to ask yourself, what does your brand stand for? Is an irreverent brand? Is it a serious brand? It is critical to first think about who you want to be at a higher level. It’s another form of customer-centricity. The best strategic approach is to begin with a broad target audience and then revise the campaign continuously as more data becomes available. Continuous iterative optimization is the best practice when deploying a programmatic marketing strategy and is the answer for how to continually compounding better economics in any marketing campaign. You can be outspent by your competitor, but you should never be “out-tested”.
A hugely differentiated factor of programmatic marketing is the sheer volume of tests you can actually run, meaningfully in any given time period.
An example of a highly effective programmatic marketing campaign was run by the digital and print publication The Economist. The Economist aimed to persuade readers to try the publication which covers topics from technology and finance to books and arts. A programmatic marketing approach allowed The Economist to customize its ads to its various target audiences and created several specialized audience cohorts which received hyper-personalized ads. In total more than 60 different ad versions, or unique personas, were created and resulted in 650,000 new prospects and a 10:1 ROI.
In traditional marketing efforts the analysis and optimization of campaigns are established after they have finished. Programmatic marketing ad campaigns are updated and optimized in real time.
Every business needs to think about implementing well executed programmatic marketing campaigns and look at what are the best practices, themes, processes and apply it to your business since it will be a uniquely powerful competitive differentiator.
The concept of branding and programmatic marketing is no longer only in the direct-to-consumer area.
Programmatic marketing can be especially valuable for B2B ad campaigns; in many B2C campaigns it is beneficial to target a mass audience, however, in the B2B sector the target audience of key decision makers is often much smaller / specialized and therefore is very well suited to a programmatic marketing approach. This kind of data-driven targeting is just not possible with conventional display advertising that is purchased upfront.
Other key benefits of programmatic marketing include:
- Allowing your team to focus on strategy instead of on mundane tasks such as creating ad orders.
- Creates more brand awareness through highly efficient CPMs (cost per thousand impressions).
- Optimizes exact best targeting in media buying.
- Reduces ad fraud through machine learning that helps identify fraudulent clicks.
Programmatic advertising continues to grow and is projected to account for 86.5% of all digital ad spend in the US in 2021.
This emerging trend is increasingly growing, and we can likely expect a programmatic approach to television and radio advertising in the near future.
There are also futurist implications for the natural next step in programmatic marketing which will potentially impact AR/VR environments where companies will be able to insert hyper specific targeted products or scenarios into a consumer’s virtual environment.
There is immense value to be gained from programmatic marketing practices for both B2B and B2B businesses. This is a business imperative to invest in best-in-class programmatic marketing, with the potential to impact every new technology medium and reach new target audiences.
Boards can ask management to share the approach to maximizing marketing investments and explore how they anticipate and mitigate risk, maximizing the effectiveness of every dollar spent on customer acquisition and retention. Contemporary, savvy boards can offer prudent business oversight on the everchanging AdTech space. We know as directors we need to ask management to show us the organizations future business plan, but we must also make sure our strategy and marketing is up to par with current digital marketing strategies.
Perhaps it would be useful for management to update the board at the next strategy session on the use of best-in-class programmatic marketing techniques!