What Does Programmatic Buying Mean?

Programmatic buying has taken the spotlight for years now in marketing circles, especially digital marketing. But many are still confused by what “buying programmatically” means.

The word in itself means to do things in a systematic way. However, in the context of digital marketing it simply means to use technology that intelligently seeks and buys the right audience for your campaign.

Remember, marketing hasn’t changed – the right targeting has always worked in marketing, it’s the tools we have now such as programmatic that have facilitated that.

The best definition I can come up with is this;
Using technology to buy audiences at the right time in the right place and for the best price available while providing the best results possible.

Let’s break it down by each point

1.Using technology to buy audiences

-The DSP (Demand Side Platform) is the one connected to the adexchanges where most of the inventory is available.

2. At the right time
-The DSP uses something called a bidder. The bidder is the technology that goes out there and bids on the audience that we are interested in for our campaign.

3. In the right place
-This could mean that the bidder is programmed to only find audiences in a specific geo-location or on specific properties (websites) but this could also mean that the bidder’s algorithm is saying that the right place is the 300×250 banner in the top right area of the website vs the 728×90 that is underneath the content.

4. Best price available
-Before RTB and Programmatic [link to previous articles] everything except search was bought on a fixed basis. With RTB technology the bidder can go out and bid on the audience we want and get the best market price available at that moment. Different verticals will have different price averages, but using this technology we can usually get the best price available.

5. Best results possible
-There are no guarantees of anything except death and taxes, as the saying goes so if any company is promising you guranteed results from programmatic, you should run in the other direction. The algorithm (the set of rules) used in programmatic decides which sites, times, creatives, and many other factors result in a conversion. This is why it is important when you decide to test a programmatic campaign that you should commit to a minimum of 30 days if not more depending on your buy cycle. This also give the algorithm time to “learn” what works.

Another common question from those interested in becoming traders (the people who manage campaigns)is:
Do I have to program – as in coding?

Nope absolutely not. It helps to have knowledge of how HTML and Javascript work (conceptually) but you will not be required to “code” anything.

Before programmatic, media planners and others tasked with the job of buying media had a role that was more focused on coordinating than anything else. In today’s programmatic environment many planners and buyers are jumping head first into DSP trading as a way to get their buys accomplished. Not only is it more hands on, but it requires a whole new set of skills.

Our courses and lessons help prepare you for the demands of programmatic buying, sign up now or let me know if you have any questions.

Comments