For advertisers and agencies, programmatic ad buying offers scale, convenience, speed and precise audience targeting. The vast majority of online advertisers spend some, if not all, of their budgets on programmatic deals. The reasons for that may already be clear, but programmatic does come with some drawbacks for advertisers.
In this section, we examine some of the pros and cons of programmatic ads for buyers, types of programmatic ad inventory, how to buy ads programmatically and how to refine your programmatic ad buying strategies to maximize results.
Pros and Cons of Programmatic for Advertisers
If you want access to the full range of online publisher inventory, it’s going to be hard to avoid programmatic platforms. Almost nobody skips programmatic completely, which is due in part to the benefits of programmatic advertising and to the fact that everybody else is doing it.
Even if you can’t really decide to completely forego programmatic in your buying strategy, it can be helpful to understand some of the pitfalls of programmatic for advertisers so you can do your best to avoid them or at least see them coming and prepare. The following are a few pros and cons of programmatic for advertisers.
Pro: Automation Saves Time and Resources
It has to be said: programmatic is fast and scalable. If you had to dig through the inventory available from every digital publisher who would like to land a portion of your budget, you would work around the clock and still never make a dent.
Programmatic helps to solve that. Publishers make their inventory available in the programmatic marketplaces, and you feed your desired demographic and user characteristic data into the program, set up and optimize your ad campaign and let the algorithm do the work. It’s highly automated to give you the wide inventory access you need and save you the time you don’t have to waste.
Con: Click and Impression Fraud Happen
Sadly, some publishers engage in click and impression fraud to inflate their revenue, and often this is happening without the publisher’s knowledge. These publishers don’t have the audience they say they have — instead, they use bots to drive up clicks and impressions to satisfy campaign requirements. Meanwhile, your campaign is not reaching the actual human beings it needs to reach.
A 2016 report by White Ops and the Association of National Advertisers found that advertisers lost as much as $7.2 billion in ad dollars to bots that year. That’s a lot of wasted money. As hard as the industry has tried to create safeguards against invalid bot traffic and impressions, few methods have worked well enough to prevent ever more sophisticated bots from inflating the numbers in traditional, open-market programmatic deals.
The good news is that you can take steps to avoid losing your budget to bots. Stick with trusted programmatic platforms that have as many fraud safeguards in place as possible and, where possible, look for deals that involve direct contact with a publisher. If you’re working in a programmatic guaranteed, preferred or PMP environment, you have a much better chance of spotting fraudulent publishers because you have to interact with them before the programmatic deal takes place.
Pro: Target Precise Audiences with Programmatic Ads
For many advertisers, the ability to target precise audiences across thousands of publishers’ audiences is the best part of programmatic advertising. Instead of identifying just a handful of publishers who appear to have the right audience, you can feed your preferences into a programmatic platform and let the algorithm do the work for you.
Programmatic offers the audience targeting scalability factor in spades, but it also offers audience segmentation that is hard to recreate with more traditional IO buys. With programmatic, you don’t just buy a spot in front of a publisher’s entire audience. You can buy a spot in front of a particular segment of a publisher’s audience and have your ad delivered to them in real time as they interact with the publisher’s site. That kind of precision is hard to beat.
Con: Technical Problems Can Derail Campaigns
Like most other forms of advertising, programmatic advertising is vulnerable to tiny mistakes that can derail entire campaigns. One wrong setting on your programmatic platform or one mistake on the publisher’s side, and your campaign may not deliver ads to the right people or even show at all.
As a piece of advertising technology, programmatic can present a technical barrier to entry that is hard for some advertisers to overcome. That’s why many advertisers work with a programmatic ad mediation partner like Playwire to ensure their campaigns are set up correctly and getting the best possible results.
Diverse Programmatic Inventory Types
Back when it first started, programmatic ad buying only applied to traditional banner display ads. It’s come a long way since then. Now, advertisers can buy the following inventory programmatically:
Banners, interstitials and other types of display inventory are all available for purchase programmatically.
Programmatic platforms can easily match up advertisers who have video ads to show and publishers who have video players to fill with ads.
Over-the-top (OTT) ads appear on streaming devices, often on free channels. A relatively new player in the programmatic ad game, programmatic OTT inventory can offer access to semi-exclusive OTT channel audiences.While most OTT content is streamed on internet-connected TVs (CTV) today, some OTT content is streamed on mobile devices. CTV-specific ads are available programmatically.
App publishers keep the lights on by selling their in-app ad inventory programmatically. Interstitials, videos and banners are common programmatic selections, but the flashier gamified and rewarded ads are not typically available.
What Traditional Programmatic Can’t Do (But Playwire Can!)
Programmatic advertising focuses on the bread-and-butter — but somewhat boring — ad inventory types: display, banner, standard video, commercial spots and the like. That’s a side effect of programmatic’s need to make a huge number of publishers’ inventory work for a huge number of advertisers in real time.
You won’t find custom ad, site takeover, gamified ad or rewarded ad inventory on the vast majority of programmatic platforms. These more interesting, and often more effective, inventory types are typically only available through direct buys because they require a lot of communication between the publisher and the advertiser.
Playwire has stepped in as an intermediary that can not only create and facilitate these ads, but sell them programmatically at customizable scale across our vast publisher network. Contact our team of online ad experts to learn more. To see some examples of Playwire’s custom ad units, click here.
How to Buy Programmatic Ads
The process of buying ads programmatically is largely automated, but it requires your input in the early stages to ensure that you get your ads in the right places.
Advertisers use DSPs to control their activities on programmatic ad exchanges. Basically, you set your targeting parameters inside the DSP, the DSP furnishes that information to the ad exchange and you buy ad inventory in real time based on the parameters you set.
You may use multiple DSPs to reach certain kinds of inventory or certain publishers. DSPs are not all the same. When selecting a DSP, you need to consider the following:
- Does this DSP give me access to the types of inventory I need?
- Does this DSP provide filters to help prevent ad fraud and keep my ads from displaying next to inappropriate content?
- Does this DSP provide real-time, accurate reporting that I can use to inform my programmatic ad buying activities?
- Does this DSP charge an appropriate amount of money for what it delivers?
- Will the cut the DSP takes from each buy damage my ability to reach enough people with my budget?
- Does this DSP allow me to use the right kinds of data to target the precise audience I need to target? (And is it prepared to leverage first party data as data from third party cookies fades?)
Focusing on Select SSPs
SSPs list and connect publisher sites in the programmatic ecosystem, but advertisers can leverage what they know about certain SSPs to ensure that they get access to the right programmatic ad inventory.
If you know, for example, that certain SSPs cater to publishers with high-income audiences or audiences that live in particular locations, you may be able to select those SSPs in your DSP settings and only purchase ad inventory from them.
Because SSPs do not have publishers’ best interests in mind, Playwire adds value by getting involved in the ad sales process and ensuring that maximum publisher revenue is the first and foremost concern.
Publisher Site Lists
To get even more granular, some DSPs allow advertisers to use lists of individual publishers to drive their programmatic ad buying activities. If you have narrowed down the inventory you want to a few hundred or even a few dozen publishers, this method can help you get your ads in the right places while still benefiting from the convenience and speed of programmatic advertising.
Buying Ads by Vertical
Advertisers who are less interested in particular publishers but really want to get impressions from people who are engaged with a particular topic may benefit from programmatic ad buying by vertical. You may be able to select certain verticals inside your DSP. That way, you would only purchase ads from publishers within that vertical.
Fraudulent reselling of inventory and click and impression fraud plague the world of programmatic advertising. But two technological innovations help advertisers avoid becoming victims of ad fraud: Ads.txt and Sellers.json.
These are both files that enable buyers to verify the identity of the final seller of the inventory. DSPs and buyers should only buy through Ads.txt channels and look for Sellers.json files you can review on exchanges.