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A History of Programmatic Media
Programmatic advertising has evolved from digital ads launching in the 1990s to now dominating the digital ad space. It began with ad networks simplifying the process by aggregating publisher inventory. Exchanges then added scale by creating marketplaces for real-time bidding. Today, programmatic uses data and software to automate ad purchasing, allowing for improved targeting, control, and efficiency. Key components of programmatic real-time bidding include demand side platforms for advertisers, supply side platforms for publishers, and data management platforms for housing audience data. Common programmatic strategies involve prospecting, retargeting, and optimization testing to improve metrics like cost per acquisition. The vision is for programmatic to handle the majority of media buying through self
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Introduction to programmatic media, covering its evolution, including key milestones from 1994 to 2011.
From simple digital ad buying to complex systems involving multiple parties and networks, highlighting challenges and market opportunities.
The introduction of exchanges for real-time bidding added scale to programmatic buying, increasing flexibility for advertisers and publishers.
A visual representation of the increase in programmatic ad spending in the U.S. from 2011 to 2017.
Definition and categories of programmatic buying: Guaranteed, Private Exchange, and RTB, emphasizing automation and real-time auctions.
Overview of how RTB works, including roles of traders, DSP, DMP, and SSP in the buying process.
Development of trading expertise from complexity to intuitive technology, enabling in-house trading for agencies and brands.
Functions and benefits of DSP, DMP, and SSP in programmatic advertising, focusing on targeting and data management.
Overlap between technologies (e.g., DSP + SSP) creating market confusion and raising questions about advertiser and publisher priorities.
Differentiation of prospecting and retargeting strategies in programmatic ads, focusing on audience targeting.
Sample campaign control parameters for a jewelry brand, detailing targeting and budget constraints.
Summary of prospecting targets based on demographics and interests, along with retargeting strategies.
Outlook on programmatic media buying through self-service platforms and establishing a specialized Programmatic Media Team.
Final acknowledgments and thanks.
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A History of Programmatic Media
- 1. A HISTORY OFPROGRAMMATIC MEDIA
- 2. I. Programmatic Evolution II.How Programmatic Works Table of Contents 2
- 3. PR OGRAMMATIC EVO LU TIO N
- 4. RTB GOES MAINSTREAM 1994 19962005 2007 20112000 DIGITAL AD EVOLUTION DSPs LAUNCH AD EXCHANGES LAUNCH ADWORDS LAUNCH (SEARCH) AD NETWORKS LAUNCH DIGITAL ADS LAUNCH 4 2008 MDC LAUNCHES VMM
- 5. Advertiser and Publishernegotiate CPM and budget to show an ad for a given period of time Advertiser Publisher 5 IN THE BEGINNING… DIGITAL AD BUYING WAS RELATIVELY SIMPLE
- 6. AdvertiserPublishers More parties todeal with / Higher cost to attain reach / Higher overhead 6 BUT IT BECAME EXPONENTIALLY COMPLEX Publishers
- 7. MARKET OPPORTUNITIES DEVELOPED • Inventory centralization • Reduced overhead • Scale at lower costs • Automation • Smarter targeting • More data 7
- 8. Pros: Advertisers: Centralized buy; lowercost Publishers: Helped sell inventory at scale Networks aggregate site inventory into single package Cons: Advertisers: less transparency and precision with pubs and audience Publishers: Still a large amount of unsold inventory Tremor Network Reuters Men’s Fitness Food Network Sports Illustrated AOL Network VH1 USA Today Ellen Comedy Central 8 NETWORKS SIMPLIFIED THE PROCESS
- 9. A marketplace tomake real-time bids for ad inventory (like search) Pros: Advertiser: Greater site flexibility and lower costs Publisher: Sell larger amounts of ad space Cons: Advertiser: Need technology to manage multiple exchanges and hit audience Publisher: Difficult to maximize profitability Google (ADX) Exchange Yahoo Exchange NetworksNetworks 9 EXCHANGES ADDED SCALE Publishers Publishers
- 10. -Focuses on theaudience rather than the site -Centralizes point of access for inventory -Access to robust data for smarter decisions Programmatic Exchange Network Publishers 10 PROGRAMMATIC EMPOWERED WITH CONTROL Programmatic uses intelligent software to purchase digital advertising
- 11. PROGRAMMATIC FLIPPING THEMARKET 11 0% 20% 40% 60% 80% 100% 2011 2012 2013 2014 2015 2016 2017 Programma3c Non-‐Programma3c eMarketer: “US Display Ad Spending Share, by Type” 2013
- 12.
- 13. Definition (IAB) Publisher Advertiser Programmatic Guaranteed (Premium, Direct) Private Exchange (Invite-Only Auction) RTB (OpenAuction) TYPES OF PROGRAMMATIC BUYING 13 Purchase of ads through real-time auctions Publisher restricts auction to select buyers/advertisers Resembles traditional direct sales; differentiated by automation of RFP, IO, trafficking for publisher
- 14. Definition (IAB) Publisher Advertiser Programmatic Guaranteed (Premium, Direct) Private Exchange (Invite-Only Auction) RTB (OpenAuction) TYPES OF PROGRAMMATIC BUYING 14 Purchase of ads through real-time auctions Publisher restricts auction to select buyers/advertisers Resembles traditional direct sales; differentiated by automation of RFP, IO, trafficking for publisher
- 15. PROGRAMMATIC RTB PROGRAMMATICRTB IN LUMASCAPE 15
- 16. • Traders (tradingdesks): the people • Demand Side Platform (DSP): trading desk tool • Data Management Platform (DMP): data • Supply Side Platform: publisher tool COMPONENTS OF PROGRAMMATIC RTB 16
- 17. 2. Publisher reaches outto SSP to sell inventory DMP 3. SSP sends bid request with audience data (DMP) to DSPsPublisher Traders Advertisers $2.00 CPM $1.50 CPM 5. SSP chooses winner; advertiser pays $0.01 more than competitor $1.00 CPM 4. Traders send bids to show ad for audience (DMP) to DSP Winner $1.51 CPM Programmatic Programmatic SSP 1. User lands on publisher site PROGRAMMATIC RTB FLOW DMP DSP DMP DSP DMP DSP
- 18. • The people(RTB buyers) • An organization that manages programmatic media typically using DSPs and other audience buying technologies – Place ads based on target audience – Manage bids, placements, and targets TRADERS 18
- 19. • Trading initiallyvery complicated, requiring specialized expertise from traders • Technology has evolved, making programmatic buying more intuitive • New technology empowers agencies and brands to take back control of programmatic buys with in-house traders or search teams EVOLUTION OF TRADERS 19
- 20. • Tool fortrading desk (advertiser) • A piece of software used by traders (advertisers) to buy advertising placements with real-time bids • Benefit of DSP for Advertisers – Central access to publishers, networks, exchanges, SSPs – Targeting/control options – Robust reporting – Automated optimizers (targeting/ads) – Brand protection (white list, content, viewability) DEMAND SIDE PLATFORM (DSP) 20
- 21. Targeting Control Audience • Demographic • Interests/Behavior Ø First Party Ø Third Party • Geography Site • List • Category • Content • Budget • Bids • Day Part • Frequency • Brand Protection 21 DSP LEVERS
- 22. • Data forboth advertisers and publishers • A data warehouse that houses information and spits it out in a way that’s useful for marketers and publishers • Benefit of DMP for Advertisers – Data to develop and target specific targets – Target specifications applied across large source DATA MANAGEMENT PLATFORM (DMP) 22
- 23. • Tool forpublishers • A piece of software used by publishers to sell advertising in an automated fashion • Benefits of SSP for Publisher – Access to advertisers, networks, ad exchanges, DSPs – Automated yield management – Robust reporting – Block advertisers – Price floors SUPPLY SIDE PLATFORM (SSP) 23
- 24. • Companies crosslines – Rubicon (SSP + Exchange): Advertising Automation Cloud – AppNexus (DSP + SSP): Flexible Technology – Google (DSP + Exchange + SSP): Internet Monopoly • Issues – Market confusion – Who is more important? Advertiser or Publisher? • Bottom Line for Advertisers: Does it work? 24 BLURRED LINES
- 25.
- 26. Prospecting • Targeting adsusing audience or site data • Scale new customers • Learn about audience Retargeting • Targeting ads based on users’ past site visitation • Convert intent into sale • Overlay prospecting strategies 26 TACTICS
- 27. Control Parameters (Campaign) Budget:$1,000/day Max CPM: $10 Frequency: 4/day Brand Safety: No Sexual Content Targeting Requirements Geo: NY/NJ Day Part: Weekends Demographics < User Age < 36-45 Demographics < HHI $150k-250k • Jewelry brand • Goal: Drive qualified traffic and revenue 27 PROSPECTING EXAMPLE
- 28. 28 PROSPECTING TARGETS Demographic s SocialMedia Users Very Highly Engaged Social Media Users Very Highly Engaged Social Media Users Very Highly Engaged Interest Fashion and Style Attitudes: Timeless fashion Fashion and Style Attitudes: Timeless fashion Fashion and Style Attitudes: Timeless fashion In-Market Women’s Fashion and Apparel Fine Jewelry Apparel & Accessories Luxury Retailers Clothing & Accessories Luxury Accessories Target 1 Target 2 Target 3
- 29. Target 1: Fine Jewelry Target2: Luxury Retailers Target 3: Luxury Accessories Low CPA Low Cost High Volume High CPA High Cost High Volume Low CPA Low Cost Low Volume Metrics Optimization Increase daily budget Pause Increase CPM or frequency Test without ‘Timeless Fashion’ 29 PROSPECTING OPTIMIZATION
- 30. NEED PRODUCT DATA30 RETARGETING STRATEGIES iPad Page (no purchase) Retarget with iPad Ads General Sequential Messaging Last Page Visited Search Apple Page (no purchase) Retarget with iPad Ads Second Ad: iPad Sizes (DR) First Ad: Lifestyle Ad (TV) Upsell Search for ‘tablet’ Retarget with iPad Ads Bought iPad Retarget with iPad Cases
- 31.
- 32. The majority ofmedia will be bought programmatically through self- service platforms, which makes media buying more transparent, flexible, and efficient. But this technology requires a new type of media professional. With insight into this evolution, The Media Kitchen has developed the Programmatic Media Team. The Programmatic Media Team will oversee 3 major areas: • Programmatic RTB (includes banners, video, and mobile) • Programmatic Direct (includes banners, video, and mobile) • Paid Search (e.g. Google and Bing) • Paid Social Media (e.g. Facebook, Twitter, LinkedIn) 32 PROGRAMMATIC MEDIA TEAM
- 33.