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Alex Barfield
Senior Planner

Alex is Senior Planner at Headstream. He ensures that all work takes a long-term view and is optimised based on business and client requirements. His work comprises research and insight, content strategy, data analytics and paid social.

Alex works across all Headstream clients on national and global accounts including BBC, GSK, National Trust, FatFace and Schuh.

Before joining, Alex worked at Universal Music.

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Image source: Escola Santa Anna

Programmatic buying: What's it all about?

| 29 July 2014

The advertising market has changed and now we hear clients taking more of an active view; wanting to talk to the audience, and move away from the more traditional ways of paper-based media buying. For example it cost an estimated £60,000 for every second of ITV’s ad time during the World Cup, a little excessive perhaps when compared to the same advertising equating to an estimated 3p across digital. 

Programmatic buying means different things to different people. In its simplest form programmatic buying is the process of using data and technology to find the audience, and is not to be confused with RTB (as you can buy programmatically and not RTB, which is just one method of buying).  

To get a brand in front of an ‘always on’ and digitally-connected consumer, new opportunities for the brands to connect needed to be created. Now the door has been opened to significant developments in targeting capabilities, with around 100 Demand Side Platform’s (DSP) operating in the UK, ‘providing technology platforms for buying real-time targeted advertising’. (econsultancy) 

Data is at the heart of the programmatic process, with millions of different data points being evaluated in real-time, to optimise campaign performance and deliver efficiencies; in order to get the right content, to the right person, in the right place, at the right time.

Real-time bidding (RTB) is a process where an advertiser bids across a network of publishers, looking for specific audiences. Waitrose and John Lewis are a couple of the companies currently at the forefront of buying audiences through RTB. The auction process is quick however – blink and you’ll miss it. When a user loads a website, data is sent to the ad exchange about the user (i.e. their browsing history, demographics etc) and an instantaneous auction occurs, with the successful advertiser getting an impression if the criteria match.

But with the programmatic market becoming more competitive, how do you make sure you cut through?

Real-time advertising lets you know who your audience is. However, for saying companies now have access to X, Y and Z about their potential consumers, a miniscule amount of companies are actually using this data correctly. 

Having good audience data which accurately describes your customers is key to programmatic buying. Virgin Media are a good example of a progressive organisation who is successfully managing their programmatic strategy. They split their programmatic budget between retargeting ads and prospecting ads, to target both customers who have been previously browsing in the market and potential new customers. They have also set caps on frequency to avoid over-exposure on all types of ad spend.

In addition by placing your ads where the customer is; far and wide across their varied online activity and in places not necessarily ‘fit’ for your brand (instead of a niche collection of websites you assume they will be), you can target customer segments that were not previously interacting with the brand, driving huge conversion rates.

This blog post is the first in a series of articles regarding Programmatic advertising. Keep posted for the others where we shall delve more into detail discussing the programmatic family, and then the things to watch with programmatic advertising. 

In the meantime, check out our Slideshare deck here, or to watch IAB’s video explaining the evolution of display advertising, click here

Alternatively, Strategic America also have a pretty snazzy infographic here