What is Localized Programmatic Advertising?

Today’s world is built on data. Honing in on this data is the cornerstone of programmatic advertising, that buzzword you can’t get away from. And it probably seems overly complicated.

Acronyms like DMP (data management platform) and API (application programme interface), can make it seem overwhelming.

However, when you learn that programmatic advertising is projected to account for 50% of all digital ad sales this year, it’s hard not to be curious.

Related: Programmatic Display 101

So what is it?

Put simply, programmatic advertising automates the decision-making process of media buying by targeting specific audiences and demographics. This methodology utilizes artificial intelligence and real-time bidding for everything from online display to Facebook advertising to mobile campaigns. It’s even moved into traditional TV campaigns.

In other words, it’s using data and technology to go after the right person, at the right time, in the correct format, on the right device. No more publishers. No more drawn-out negotiations. It’s 2018. Let’s let the data do the talking.

Sophie Dufouleur, global content and social media group manager at Nestlé Nespresso, gives a perfect example. She explains that they wouldn’t target their Nespresso users with the same advertising as those who have never purchased—or even heard of—their brand. The latter group likely needs more educating, for example.

Programmatic advertising has its perks. It’s hard to compete with programmatic advertising’s combination of extensive data, ad inventory, and targeted marketing. It brings results.

As consumers have become more comfortable with the technology, it has been implemented across every channel imaginable. In fact, eMarketer predicts that 82.5% of all US digital display ads will be bought via automated channels in 2018.

Local programmatic advertising takes this process one step further. By zooming in on your audiences, you deliver hyper-personalized messages. Research shows  local

Let’s dive into how this works by taking a step back—to television.

What are Local Media Groups

Traditional TV advertising is where it all began. Since the first television ad aired in the 1940’s to today’s $5 million 30-second Super Bowl slots, the television ad industry has proliferated. For the first time, however, digital ad spend is surpassing TV ads.

Local media groups—conglomerates who own local stations and station groups—are now having to rethink their ad offerings to complement digital, not to compete against it. To stay relevant, especially as the manual tv ad buying process has become burdensome, local TV stations are now playing in the programmatic advertising space as well.

Why local? Local media has longstanding relationships with their local customers. They understand their pain points and their needs. They’re often viewed by locals as reliable, trustworthy sources. Lastly, they can bundle advertising on their properties with digital.

Now let’s discuss how advertisers jump into this game. Advertising agencies provide both trade desks and networks.

What are Trade Desks & Networks

Don’t know the difference? That’s ok—most people don’t. Many companies offer both trade desks and ad networks, which adds to the confusion.

Put simply, an Ad Network is a middleman who has pre-arranged agreements with publishers. They can sell advertising on the channels they have contracts with—anything from banner ads to native advertising.

Think of these networks as brokers. They sell advertisers impressions to a specific audience across the many channels they have agreements with.

A network controls every aspect of the trading among their aggregate of channels.

The major downfall here is that clients often have little say over ad placement.

So that brings us to agency trading desks.

Ad agencies didn’t want to be cut out of the game when programmatic advertising became important. Therefore, they implemented Agency Trading Desks.

Agency Trading Desks, still relatively new, help clients execute programmatic media purchases and increase efficiency and scale in buying digital ads.

Rather than having hundreds of individual client campaigns to deliver on, this approach is more personalized. Ad buying is done for you through a single trading system.

In addition to planning and buying media, trading desks utilize centralized management platforms to measure results and report on audience data. These digital trading desks typically “talk” to your demand-side program or other audience-buying technology.

Think of this end as the stock exchange. It’s direct trading without a middleman.

While ad buying may be more complicated than ever, programmatic advertising is more cost-effective and, frankly, it delivers. Its’ results are apparent when you root back to KPIs like clicks, interactions, conversions, brand recall.

So what types of programmatic advertising can a trade desk help your team with? Geo-fencing to start!

What is Geo-fencing?

Powered by latitude and longitude data on consumers’ mobile devices, geo-fencing is used to target specific audiences who visit defined geographic areas.

For example, a retail pet store can “draw” an area around where they desire to target customers. Most obviously, this could be their store. However, it could also include their competitor’s location or the venue of a pet-focused event—or even a part of town they don’t typically draw customers from.

There are two types: Active geo-fencing requires a user to opt-in and often run an app. Passive geo-fencing runs in the background of a mobile device, relatively quietly.

For users, this feature can come across as invasive and off-putting to their privacy—or quite the contrary. If done right, it can seem incredibly personalized and convenient. For example, when they step foot in their favorite store, a coupon instantly pops up. Well, look at that!

Options are plentiful as you set up geo-fencing. You can have multiple active geo-fences. For each geo-fence, you control the parameters. Set alerts for entrances and exits of a particular area or when a specific duration has been exceeded. Tell the geo-fence to enable an action (like a coupon) or ask it to “dwell” and send only after a particular event has occurred. Finally, pay attention to expiration duration. After this point, Location Services will automatically remove it.

There are two conventional methods of geo-fencing:

Location Proximity – Local proves to be most effective. Consider your city, neighborhood, or region high-impact areas. The best place to start, if you have a physical presence, is where you conduct business to ensure your potential customers who leave without making a purchase are targeted with ads.

Conquesting – This is the “play dirty” method. Marketers can use a conquesting strategy to target consumers who recently visited a competitor’s location. Time your marketing touch very carefully here.

Time and time again, recency is relevant. Consider a touch point on these consumers just after they’ve left a competitor’s location – and several days out if data suggests no purchase has yet been made.

What is Contextual Targeting?

Contextual targeting is another feature ad desks can assist with. It looks at the category or keyword of the page a person is viewing and serves them relevant, related ads.

Create a custom list related to your business. Then, bid on specific keywords and topics across the Web and have an ad served next to related content.

What is Audience Optimization?

This final feature starts from the moment you begin planning your campaign. Create audience types based on device, browser type, geography, recency, and browsing behavior.

Then, as the campaign rolls out, move your budget, in real-time, to where it counts. In other words, hone in on audiences that are engaging and converting and scrap the other efforts.

Optimize by factors like search keywords, your unique CRM data, Dayparting, and pacing.

As you make tweaks during the campaign, remember three simple rules of thumb:

1. Don’t optimize too quickly. Give the campaign time to breathe so you don’t do anything too hastily.
2. Don’t optimize too frequently or infrequently. Give yourself a week.
3. Keep track of all your changes. Note which changes produce which results and don’t be afraid to go back and undo.

Ideally, the free-time you win back with the efficiency of your programmatic advertising should allow you to focus on customer-centric efforts. Always bring your focus back to your customer.

Summary

The days of simple ad-buying are over. No agency rep is going to take you out for beers or throw you some game tickets to win you over. But cutting the publisher out of your campaign means big wins for you.

Local programmatic advertising gives you the controls. It’s data and technology-driven. Not manual. With that, comes efficiency and effectiveness.

Think carefully about your in-house versus agency options and whether a network or trade desk is fitting for your marketing goals. Do you have the data, inventory, technology, and know-how to take this on in-house?

Then, align the possibilities behind geo-fencing, contextual targeting, and audience optimization with your KPIs. You can get as granular as you want here and, since you can make decisions impression-by-impression, you can pivot quickly to ensure optimum results.

The data is out there. How you use it determines your marketing success, and you don’t need to look much further than your area.

Embracing local efforts and innovative, comprehensive solutions lays the groundwork for long-term success.