Marketing is a disruptively changing industry. It is increasingly becoming more data, science-oriented and less reliable on intuition. One of the biggest revolutions in marketing ever is programmatic advertising. In this blog, you can find what it is, how it changed the market and the darker side of this process.
What is programmatic advertising?
Programmatic advertising is an automatic process of selling and buying ad space. By AI powered platforms, ad buyers are bidding in real time to buy an ad space that a targeted customer will see. When you are clicking on the link, there is a battle between advertisers who will show you which ad and where on the site during page loading.
It is an excellent opportunity for advertisers to analyse and change their strategies in real-time. Moreover, ad buyers can better target their audiences. In theory, it allows showing ads only to people who might be interested in their products. It is also more transparent as every member of the auction knows what the final price was.
Even though programmatic advertising’s popularity started to rise in the previous decade, it is now responsible for most of the ads you see on the Internet. In 2021, almost 87% of all display ads come from real-time bidding auctions. On mobile, it is nearly 70% of all banner ads, while it is almost 75% for video.
But it is not the end of the programmatic advertising appliances! The TV ad market is evolving with the thrive of devices connected to the Internet. It is present even outdoor, and advertisers are vying for space on Times Square banners. The advertising rule is that it is or will be automated someday if it is digitised.
Disadvantages of programmatic advertising
Unfortunately, there is also a darker side to this technology. As it is an automated process, an inexperienced marketer can present ads not precisely the way that ad buyer imagined. It is effortless to misunderstand some of the indicators and target them to the wrong audience. Usually, it is a human fault, but the technology is far from perfect. For example, sometimes your ad can appear near content that is drastic, extremist and completely deny the company’s values. The automatic advertising process must be conducted with utmost attention to details as it can produce enormous harm if misused.
But the biggest problem is ad fraud – extracting money from advertising budgets by creating artificial, non-human traffic. Advertisers are losing billions of dollars every year due to ad frauds. There are companies like Pixalate providing versatile solutions helping to prevent ad frauds on all platforms. But even with good tools, there is a tremendous risk of wasting money on ads nobody will see.
I covered the ad fraud topic more extensively in this blog if you would like to know more.
If you are wondering how this process looks in detail, here, you can find an accessible guide with an explanation step by step. Advertising automation is crucial for the development of the industry. It allows seeing hidden patterns and insights, which result in constantly improving ads quality. But we have to be careful while it is smooth to lose the money without even noticing that.
Here you can find possible influence of AI on PR industry.