How programmatic technology is disrupting media

My-Little-Pony-figure

I bought My Little Pony books for my little nieces online years ago and ever since I’ve been saddled with a little pony fanatic label on many web sites. How do I make it stop!!??

Every day, products are finding unsuspecting consumers at every turn during their daily online interactions. It used to be that if I shopped on Amazon the suggestive technologies would point me to items that would be of similar interest while I was on their site. I’d also get emails from Amazon telling me that my stock of Kuerig coffee pods may be running out after 45 days and that I needed to reorder.

But now my need for K-Cup Pods finds me on news, technology and sports sites totally unrelated to the original online retailer. It finds me on phone, laptop and iPad. I know I’ll be seeing it on my smart TV soon.

Enter programmatic advertising technology!

The programmatic technology umbrella is a large one in the advertising and media business. Under it are dozens of sub-strategies and technology drivers depending on the buying neuroscience of that particular consumer. The tweet definition for programmatic is simply “technology that automates digital media buying.”

eMarketer estimates “nearly four of every five US digital display dollars will transact programmatically in 2017, totaling $32.56 billion. By the end of the forecast period, that share will rise to 84.0%, leaving little doubt that buyers and sellers are continuing to invest in automated ad buying.”

The technologies fall under increasing degrees of complexity. A fundamental technology element for programmatic that you may hear your martech team discussing is the Demand Side Platform, almost always referred to as the DSP. This platform is essentially an automated buying platform, where advertisers and agencies go to purchase digital ad inventory — for example banner ads on websites and mobile ads on apps.

The DSP is similar to an airline reservation system that knows which “seats” in a media property are available and where on the plane (web site) they are located. The DSP can also link keywords in certain web or mobile content to the digital ads delivered to the reader.

There are occasions when programmatic ad delivery is more art than science. For example many companies now have “brand safety partners” who assure their digital advertising is not being delivered in hostile or embarrassing territory. The annals of digital advertising are littered with auto ads appearing on a page where news of a fatal crash is delivered. Blacklisting and white listing are common terms that relate to these hostile and friendly competitive or contextual environments for ads to appear. But there are such subtleties in writing that the blocking filters tend to have some large holes.

The next layer of programmatic technology is the Supply Side Platform or SSP.  This platform enables advertising inventory to be placed into an exchange for sale in the marketplace by advertisers. The SSP is more specific in that it provides minimum bid requirements and pricing based on a supply and demand algorithm. The SSP is a stock exchange of sorts where real time bidding (RTB) occurs in much the same way it does on Wall Street. The integration of DSP with SSP technology enables marketers to buy inventory across a wide array of sites and demographics using a single platform. To stretch the travel analogy, this would be like using Kayak or Travelocity to identify the best deals across all hotels or airlines for a vacation.

The rest is in the artificial intelligence that maps very specific buying patterns with the exact spot on a web or mobile site delivered at the exact moment it would get a click.  The variety of vendors that specialize in this targeting had grown exponentially along with the rise of the programmatic market. They range from those specializing in tight niches of consumer goods, to those in B2B segments where buyers identify themselves on buyer databases such as those related to government procurement.

Given the rapid growth of the use of these technologies it behooves enterprise IT professionals to become proficient in this terminology so as to reinforce the understanding of a business technology that didn’t exist in this level of sophistication but a few years ago.

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