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By now you've probably heard a thing or two about programmatic marketing. But just because you've heard about it, doesn't mean what you've heard is true. As with any buzz-generating term, there are plenty of misconceptions about programmatic marketing. To clear things up, let's go over the basics and why they matter.

What Is Programmatic Marketing?

To this day, a lot of marketers think programmatic marketing means only retargeting users with display ads after they've visited your site. That's certainly one form of programmatic marketing, but it's far from the only form.

"Programmatic" can refer to any type of digital marketing that uses data to deliver targeted messages. It might involve using online behavioral data to bid for display impressions in real-time bidding (RTB) exchanges or via the Facebook Exchange (FBX). It might involve targeting email newsletters based on user data rather than sending the same email out to an entire audience. It can even include dynamic websites that use data to serve the most relevant webpages. If you've looked at the recommended products on your Amazon page, you've seen programmatic marketing in action.

Getting Started With Programmatic Marketing

The common thread when it comes to programmatic is, of course, data. The more actionable data you have, the more precisely targeted – and successful – your campaigns will be. In many cases, that data is first-party data. Other times, companies rely on third-party solutions from vendors who collect data on (anonymous) users, often by dropping bits of code, known as "cookies," on their browsers.

Whether relying on their own data or third-party data, most companies will choose an agency or work directly with a vendor to run a programmatic campaign. The top vendors offer data management platforms (DMPs) that have the power to glean insights from the mountains of data that's now available to marketers with the know-how to take advantage.

Why Programmatic Marketing Matters

To appreciate the importance of programmatic marketing, you don't have to be a data whiz. Rather, you only have to appreciate a very simple point: Before programmatic, digital advertising was still mostly guess work. You might be able to make intelligent guesses, but you could never really be sure that you were reaching the right users.

To take an example, in the pre-programmatic era, a sports drink company that wanted to reach sports lovers might buy up inventory on ESPN.com or on the sports section of an online newspaper. Today, that same sports drink company can use programmatic to serve ads to specific people who have searched for sports drinks online, or read articles about hydration, or purchased similar products – and on and on.

Programmatic, simply put, means using data and technology to move from targeting the group to targeting the individual. In other words, it's what marketers have always longed for.

Ben Plomion

Ben is VP of Marketing & Partnerships at Chango, where he heads up marketing and is also responsible for expanding the company’s data and media partnerships. Prior to joining Chango, Ben worked with GE Capital for four years to establish and lead the digital media practice. This led to the development of GE Capital’s digital value proposition and its execution worldwide. The new venture re-energized paid, owned and earned media across 70+ web sites. Ben graduated from GE’s Experienced Commercial Leadership program after completing his MBA at McGill University. Before GE, Ben held a variety of Marketing & Business Development roles in the e-payments industry, while working at Gemalto in London. Ben writes frequently for Digiday, CMO.com and Search Engine Watch.

Chango

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