• Skip to primary navigation
  • Skip to main content

Mind Movement Machine

Helping Make AI Possible for You

  • Home.
  • About.
  • Subscribe.
  • Blog.
  • Contact.
  • Show Search
Hide Search

12 | 01 | 2018.

download the pdf.

how programmatic ads work.

*this is a guide that was created from lecture videos and is used to help you gain an understanding of how programmatic ads work.

Programmatic Advertising Foundations

Programmatic media buying is the byproduct of artificial intelligence and technology integration of media buying. Programmatic advertising (or programmatic media buying) is the entire process of automating the display and triggering of digital advertisements. This is how programmatic ads work in a simple statement. Programmatic advertising has two main components: buyers of ads (advertisers) and sellers of ads (publishers). There are open system and closed system programmatic advertising. Open system allows for a direct access to inventory, from different media owners. Closed system only allows access to content from a specific partner network like Google or Facebook. Advertisers want access to more inventory than solely Google and Facebook. Advertisers want to lower costs and the dependency on these partner networks. Using data points, you should learn which inventory is more valuable and setup the appropriate marketing automation. Online consumer behavior is transitioning to an omnichannel approach, which allows for marketing through the entire journey. Most channels such as digital, TV and newspapers allow for programmatic advertising methods. Multichannel programmatic advertising has the benefits of being personalized and can carry put to scale. Attribution modeling allows for transparency. Artificial intelligence allows for better segmentation and an expanded reach.

Uses of Programmatic Advertising

Retargeting/remarketing for data driven targeting and an increased ROI. Lead generation for affinity audiences and competitors social followers to create leads. Responsive advertising can server on multiple channels without needing different versions. Branding to focus on awareness with the right audience. Customer Journey Assisted Sales to support the user at stages of the purchase funnel.

Programmatic Advertising Technology Stack

Domain Type Platforms (DSP) are used to manage media buying and ad creative through publishers. This is where you create, monitor and optimize the campaigns. The variables such as how much for an impression or click is done in the DSP. Example DSP’s are The Trading Desk, MediaMath, Rocket Fuel and DoubleClick Bid Manager (DBM).

Supply Side Platforms (SSP) are used by publishers to manage their client campaigns. Publishers will automate the process but they input into the SSP to do so. Examples of SSP’s are OpenX, AOL, AdX.

Data Management Platform (DMP) is a hib where data is collected and analyzed to allow you to form bidding decisions. Data that can be included is as follows: CRM, Apps, external data partners and etc. Adobe Audience Manager, DoubleClick Audience Center and AdRoll are examples of DMP’s.

Ad Servers are used to track users across different platforms (instead of a single website) and will enable you to serve ads based on the users specific behavior. Examples of Ad Servers are Atlas, OpenX, Adzerk and DFP.

Analytics allows for measurement, reporting and attribution which should integrate with each programmatic advertising software.

Ensure the technology stack you choose allows the certain volume of inventory you need.

Real Time Advertising

Real time advertising is the ability to place a bid and serve an ad to a user after a specific behavior is taken. Your ad server will determine instantly if a user should see an ad based on their behavior or not. This is done by using data to trigger an ad based off a specific user behavior or event such as visiting a product page of your website. Real time advertising places an emphasis on relevance, timing and location and because of this, increase engagement with ads. Real Time Advertising is a crucial component when learning how programmatic ads work.

Bid Adjustments are set in advance based off of user behavior and desired target audience.

Programming Creative are component based ads that are assembled based on variables such as location, gender and so forth. Ex. If a user is a X then show image A and ad copy B.

Domain Type Platforms are used to setup the campaign with triggers based off of data points, control the budget spent and to monitor the performance of the campaign.

Supply Side Platforms are used to expose inventory to the highest bidding advertiser and to provide details based on the type and impressions.

When there is no match between an advertiser and visitor, an unspecified advertiser will fill the inventory at a lower CPC.

Real Time Advertising is based off of user data and advertiser requirements.

Omnichannel programmatic advertising allows us to serve ads to users that match a specific criteria across different marketing channels. Data Management Platforms (DMP) allow you to reach most channel networks within one software.

Programmatic advertising for applications or mobile pay per click can typically have a higher CTR compared to desktops. Bounce rates and unintended clicks can be higher on mobile. For ad placement on mobile, look at the cost per conversion.

Programmatic Advertising Campaigns

Media Types- video ads, responsive banner ads that are responsive or interactive, text ads

Using the right ads across different screens- image ads you can upload 3 ads that an ad server will use, product feeds are served through display and remarketing and typically require one version of an ad and will automatically resize, for video ads you can upload one ad that will conform to different specifications.

Campaign Tips

Ensure you A/B test different copy for your ads because an ad servers objective is to sell more clicks to the best performing ad.

For publishers using a Supply Side Platform(SSP), you install a script within the inventory and the script will then measure categories and the volume of inventory that is available. The information is sent to a Data Management Platform that will allow advertisers to consider the available impressions for a display placement.

Data Management Platforms use the bid adjustments to calculate bids. The highest bid will get the impression on a website.

Data Management Platforms

AdEX, MediaMath, Neustar, Adobe, Nielsen, Oracle BlueKai, Google Analytics 360

Ensure your data management platform has audience building, CRM support, content customization, scale audiences from third party data and reporting tools.

Choosing Auction or Direct Buying

Direct Buying has premium content listed that an advertiser will bid exclusively for and the inventory will then become unavailable. Programmatic direct buying will override real time buying.

Brands will choose direct programmatic advertising to focus on specific websites and to raise barriers to your competition. Publishers will choose direct programmatic advertising to have control over the ads published on their site and can block certain products from showing on there content.

Programmatic Advertising Targeting Methods

Ensure you understand the right combination for targeting criteria. Do not place high bid adjustments when getting started. Your objective is to target the right user with the right ad at the right time.

First party data is customer and user data that your company has such as email. Third party data is data that is held from third parties about their users and customers.

Audience targeting- targeting that relies off of search engines and social sites and the data they have about the users. New audiences that match highly specific segmentation criteria will emerge due to artificial intelligence and data.

Impression targeting- relies on third party data. This is done by browsing an inventory list on an ad server and you can see how many impressions are available from certain characteristics. This is not good for conversions but can have a lower cost per click on average.

Contextual targeting- targeting a user based off of specific content

Behavioral targeting- targeting that is based off of specific rules a user takes

Geo targeting- targeting a user in a specific location or interest in location

Remarketing targeting- targeting to previous visitors, remarketing targeting can be done in real time advertising when integrated with your CRM

B2B Marketing with Programmatic Advertising

Create retargeting lists from LinkedIn, Facebook etc. -> setup your campaign in LinkedIn with proper retargeting lists -> a CPC can be quite high as long as you know the business, budget and acquisition cost. B2B campaigns can start off expensive, but as your retargeting list grows the cost will decrease.

Programmatic Advertising for Influencer Marketing

Create a LinkedIn Display Ads or Sponsored Emails campaign to build a retargeting list -> spread retargeting across other channels such as Facebook and Google -> generate emails from campaign -> create a re engagement campaign before a list expires on LinkedIn You can setup website retargeting for LinkedIn Ads using LinkedIn Marketing Solutions

Audience Insights

Attribution modeling will assist in identifying the sources of conversions and new users.

Artificial Intelligence is increasingly becoming prevalent in marketing as marketing is data-driven. New segments can be created from the vast amount of data collected. Using data science is the next pivotal step in predicting conversions. Artificial intelligence can lower competitive barriers.

Accidental Clicks and Ad Fraud

Fake social accounts, fake email addresses and bots are examples of ad fraud. Do not rely on ad servers to detect ad fraud. To get started with programmatic advertising you can visit thinkwithgoogle for more information or reach out in the comments.

  • Click to share on Facebook (Opens in new window)
  • Click to share on Twitter (Opens in new window)
  • Click to share on LinkedIn (Opens in new window)
  • Click to share on Reddit (Opens in new window)

Tagged With: digital advertising, google ads, google analytics, programmatic advertising

Get More Help.

Reader Interactions

Your Mind Moves the Machine. Cancel reply

Helping Make AI Possible for You.

Mind Movement Machine ©

  • #mechanizeme.