What is programmatic advertising and is it the next big thing?
Programmatic advertising is precision-targeted automated online advertising purchasing and ad tracking through AI-powered network software platforms. The platform connects demand from advertisers and context-driven ad supply for specified buyer categories. Programmatic advertising uses automated technology and Machine Learning algorithms for media buying and selling. It utilizes user signals to ensure that ads serve the right audience in the right place, at the right time. Programmatic marketing platforms usually have four main components:
- Publishers who sell digital advertising on an SSP (supply-side platform).
- Advertisers who use a DSP (demand-side platform).
- Data management platform – DMP.
- Ad exchange that connects the systems for automatic buying and selling, as well as tracking campaign results.
Why is programmatic advertising worth the effort?
- It saves time and effort for your marketing team as the process is fully automated.
- The system targets the right users, so the ads are more effective.
- You can enjoy the larger reach for publishers.
- Programmatic advertising ensures a high level of transparency – you have total visibility over your campaigns.
- You have access to all information in real-time so that you can make decisions on the fly, for instance, adjusting campaigns when necessary.
Profitable trends in programmatic advertising that shape the marketing of the future
The most relevant example of recent programmatic advertising trends is of course the preparations for the third-party cookie phase-out promised by Google. Advertisers will soon no longer be able to track customers across the web. 1% of Google users will be migrated to Privacy Sandbox and after a series of tests, all users will be migrated by the end of 2024. This will certainly affect the programmatic landscape of many advertisers. What else can we expect in programmatic advertising growth in 2024?
Contextual targeting and advertising personalization
Contextual targeting means delivering ads that promote products relevant to a page’s content. So, on the cooking website, you may be served ads for kitchen accessories, cooking-related experiences, and so on. According to Integral Ad Science, contextual targeting can boost ad relevance by 63%. In 2024, companies will focus on delivering contextually relevant ads and thus, create a more engaging user experience.
Various forms of advertising in the programmatic world
In 2024, we will certainly witness the integration of AI in creative optimization. Artificial Intelligence tools will use data to tailor ad creatives up to speed, ensuring that users will see the most relevant and engaging format. There will be more video formats (in 2023, online video ad spending reached $39.4 billion in the US!) and more in-app ads that offer a direct line to customers during their most engaged moments. Dynamic creatives will take personalization to the next level. Ad content will be adapted in real-time based on user behavior and preferences which may be revolutionary for increasing conversion rates.
Increased visibility range
AI-powered level of precision and automation is a huge step for marketers to optimize their marketing strategies and achieve outstanding results in customer engagement and brand visibility. This is because programmatic advertising allows you to reach your target audience more effectively and engage them with relevant, more personalized adverts.
No intermediaries
Private marketplaces are on the rise and it’s not only in the US. It seems that open exchanges may even be replaced by private marketplaces in the next few years. They certainly guarantee an exclusive intimacy that comes with a safe environment, transparency, and the certainty that ads will appear only on high-quality media platforms. On top of that, advertisers armed with AI tools are more independent of intermediaries, controlling their programmatic campaigns on their own.
Digital advertising trends in the programmatic industry – AdTech consolidation
So, what programmatic trends and new AdTech solutions powered by AI should you follow in 2024?
Programmatic in CTV – connected TV
Connected TV is now a relevant part of a holistic programmatic strategy. According to Insider Intelligence, CTV is expected to grow by 10.4% between 2023 and 2028. With more and more people shifting towards streaming services, it’s clear that the rise of programmatic in connected TV will be a top trend next year.
In-house programmatic
This trend is particularly visible in major brands. As they expect comprehensive control over their data and greater assurance of compliance with privacy regulations, they tend to decide to build their own programmatic teams equipped with powerful tools. An additional advantage of in-house programmatic is cost savings, as well as resource efficiency.
Digital out-of-home programmatic advertising (DOOH)
After the pandemic, marketing experts are now looking for innovative methods to target customers who are back on the go. From billboards to buses, people see out-of-home adverts everywhere, whether they go shopping, travel long distances, or commute to work. DOOH digitizes and upgrades the experience to include 3D and interactive displays. Thus, brands can use digital out-of-home programmatic advertising to create memorable, eye-catching experiences that leave customers with a lasting impact.
White Label Software
White-label solutions are ad platforms that allow companies to target customers. Such software is fully re-brandable, customizable, and maintainable. The platform acts as part of your company with no mention of the original creator. It increases the control you have over your campaigns and provides transparency to the ad-buying process.
Voice and semantic searches
The popularity of voice-activated devices has been increasing, extending also into programmatic advertising. Advertisers can reach their target audiences through voice-optimized ads which brings new opportunities for engaging customers. According to Google, 27% of the global population is using voice search on mobile, after all.
Visual search
Visual search uses real-world photos as a search starting point. The software will identify the object in the picture and provide search results based on that item. Technology has been transforming the way people shop online. It’s an amazing opportunity for advertisers to reduce the number of returns by providing more accurate search results based on visual similarities.
Advertising industry trends in mobile gaming
In-game adverts have a huge potential to reach a vast demographic spread across all ages and genders. Such ads integrate seamlessly into the gaming environment which enables companies to connect with a highly engaged and diverse audience. It’s worth highlighting that the number of people who play mobile games is expected to grow from approx. 1.8 billion in 2021 to over 2.7 billion by 2027.
Why are programmatic mobile advertising trends especially important for digital advertisers?
The rapid growth in the number of smartphone users and the increased time people spend using their phones speak for themselves. To stay competitive, you just have to use this segment to promote your products and increase your brand visibility. There has been a growth in the activity of in-game ads. Also, mobile e-commerce is estimated to account for 70% of all online retail sales by 2024. A mobile-first approach results in higher customer reach and retention, improved customer experience, and new channels of revenue.
What are the programmatic advertising forecasts and future growth trends?
Ready to integrate the programmatic advertising trends into your marketing strategy for 2024? According to Statista, programmatic display ad spending in the US will reach $168 billion next year which is clear evidence that programmatic marketing is driving the future of various sectors such as e-commerce. Advancements like cookieless marketing, personalization, and AI solutions give rise to new ways of doing marketing and converting new customers. If you want to achieve your business goals and discover how new technologies are shaping the future of programmatic, our AI developers are here to help. Let’ talk!
