The world of digital advertising is evolving at breakneck speeds, with programmatic advertising emerging as a leading force in media spending and opportunities. The industry is being reshaped by privacy legislation. As a result, spend is shifting into environments where advertisers have more data and more control.
Programmatic advertising offers precisely that, which is why programmatic display ad spending will grow by 16.9% in the US this year (2023)—the highest growth rate of any country tracked. Programmatic advertising enables businesses to leverage advanced targeting capabilities, real-time bidding, and machine learning algorithms to deliver personalized, high-impact ads across multiple channels.
With the digital landscape shifting rapidly, we wanted to lay out some of the misconceptions of programmatic advertising that may have you weary about investing in this space.
Misconception #1 : Programmatic Advertising = Display Advertising
Many marketers believe that display advertising is synonymous with programmatic advertising, but this is not entirely accurate. Programmatic advertising is a much broader category that includes display advertising as just one ad format.
Display advertising refers to the use of visual ads, such as banner ads, on websites and other digital channels. These ads can be targeted to specific audiences and displayed on websites that are relevant to the advertiser’s target market.
Programmatic advertising, on the other hand, is a method of buying and selling digital advertising inventory that uses software and algorithms to automate the buying process. It includes not only display advertising, but also video, mobile, native advertising, streaming audio (Spotify, Pandora), as well as Connected TV (streaming TV apps like Hulu, Peacock+, Tubio, etc).
Misconception #2: Google Display Network Reach is More Robust or The Same As Programmatic Ad Networks
The Google Display Network (GDN) tends to be the most well-known platform to run display advertising, as many companies dip their toe in on display campaigns to complement PPC. GDN integrates with websites, YouTube, emails, blogs and mobile apps that partner with Google. GDN can serve ads to more than 2 million websites, including YouTube, and can potentially reach up to 90% of the world’s internet users at some point on the web.
With GDN, you’re able to run ads through Google’s subsection of the internet, which is huge. But Google does not have access to every single ad space on the internet.
Google Display reaches about 90% of the internet, while Programmatic reaches about 99%! Google doesn’t have access to high impact ad formats, premium private marketing place (PMP) deals, as well as the reach to audio and TV. There are many other platforms within the umbrella of programmatic advertising that reach their own unique subsets of the internet, like Google.
Let’s Review What GDN is:
The Google Display Network acts as an intermediary between the advertisers that want to serve ads and the publishers that have inventory connected to the network (and the audiences the advertisers want
Now a quick overview of a Programmatic ad exchange:
Where the Google Display Network is one network, Programmatic ad campaigns use Demand Side Platforms (DSPs) that can access many ad networks (20+), including GDN. With the added coverage, certain networks can reach up to 99% of websites on the internet. Google’s Display Network reaches over 90% of all websites on the internet, since many register as a Google partner but also open up inventory to other networks.
Programmatic ad exchanges curate information from many places across the web, including third-party data from data management platforms (DMPs), such as Epsilon, Dun & Bradstreet, Cloudera and Zoominfo. Buying through a programmatic platforms allows for access to more ad inventory and allow for more precise targeting options and varieties. On the same ad network, advertisers can serve more ad formats to users across the webs and devices (including TVs!)
Misconception #3: Programmatic Ad Targeting Is Similar to Options Available on Facebook, Google and LinkedIN
Google Ads, Facebook and programmatic have different functionalities, and in order to make the right choice, you’ll have to define your campaign purpose first. Below we’ll lay out the main source of targeting data for the different platforms and how they differ.
GDN Targeting Overview:
GDN uses Google’s data (like search, content, and demographics) to target users. GDN targeting allows you to set where or when your ad is shown based on features of your ideal audience, such as their personal interests, age or gender.
Facebook Targeting Overview:
Facebook’s targeting algorithms use behavioral data and interpret it to find audiences that might be most interested in buying this or that product. Facebook has implemented a lot of targeting restrictions due to privacy concerns and also restrictions with ios14. In 2021, they eliminated the ability to target based on users’ interactions with content related to health, race and ethnicity, political affiliation, religion and sexual orientation. If your industry falls into their Special Ad Categories of Credit, Employment, Housing and Social Issues/Elections/Politics Facebook restricts audience targeting options and prevents you from constructing a target audience based on age, gender or zip code.
Programmatic Targeting Overview:
Programmatic uses multiple sources of data, including in-depth data from trusted third-party agents and your brand’s own first-party data. Because the data isn’t owned by the platforms that are providing it, programmatic doesn’t have the same restrictions as Google and Facebook with targeting.
Google Vs. Facebook Vs. Programmatic:
All platforms have different targeting pros and cons, and overall they work well together at nurturing new customers with different touchpoints and types of media / messaging. It is important to test the same campaign type on different platforms and continually analyze whether or not you have reached your advertising KPI. Also, customers need multiple touchpoints and as these campaigns reach users in different areas of the web and devices, these strategies all work together to help reach your ultimate goal.
In conclusion, the benefits of programmatic advertising cannot be overstated. By debunking these top three misconceptions, we hope that marketers will gain a clearer understanding of the immense potential of programmatic display advertising.
As the digital advertising landscape continues to evolve, investing in programmatic advertising can help businesses reach their target audiences with personalized, high-impact ads across multiple channels.
With its advanced targeting capabilities, real-time bidding, and machine learning algorithms, programmatic advertising is a powerful tool that can help marketers stay ahead of the competition and achieve their advertising KPIs. Don’t let misconceptions hold your marketing strategy back; unlock the power of programmatic display today!