Programmatic advertising is a component of advertising technology that is the most crucial in relation to other forms of advertising. It is currently keeping the whole ad tech fraternity on its toes, waiting for what is going to happen next. In the coming years, programmatic advertising is set to act as the default trading method in media. Programmatic ad spending is expected to reach $98 billion by 2020, according to Zenith’s report. This will amount to 68% of the total global digital media ad spending.
Artificial Intelligence technologies introduction will increase the efficiency of Programmatic advertising; other technologies that enhance its functionality includes 5G and machine learning. Opening of different channels for advertising like Podcast, Digital Out of Home, ads that have been voice-activated, Audio programmatic advertising, AR/VR, and smart devices provides marketers with more options while also providing the customer with a more personalized and engaging experience. It is much better compared to TV ads of yore that divided customers according to demographics alone.
Top Trends In The Programmatic Advertising Industry
1. AI in programmatic advertising.
Audience management strategy is maturing progressively, currently with marketers understanding the connections between measurement, targeting, campaign optimization, and audience selection. The use of Artificial Intelligence in programmatic advertising will continue to rise. This is because it provides the marketers with deluge data that enables them to target the right people at the right time, right channel, and device and with the right message.
To move customers further into their purchasing journey, artificial intelligence (AI) and Machine learning help by moving through large volumes of information to find patterns in real-time. These technologies propose the next better action, and predict the outcome to a specific individual customer. With Artificial intelligence, it is not just speeding and scale that it can bring to the marketing process, but also intelligence that no human can match at that speed and scale. This is what makes AI vital in the marketing process.
Artificial Intelligence will enable marketers to analyze the behavior of a customers in a real-time basis, with multiple data points like age, gender, location, History, preferences, device, platform, and more. Mapping the user data With Ad viewing metrics, it will be able to suggest in what format to place an ad, where, and when. Artificial intelligence helps in increasing the overall ad effectiveness due to its ability to recognize buyers’ patterns accurately. It then places an ad accordingly. This, therefore, reduces customer acquisition costs.
AI programmatic advertising has considerably attracted the attention of many advertisers in the last two years. According to a 2018 survey by Deloitte, 82% of the early adopters of AI reported a positive investment return for their AI initiative. This shows that AI programmatic advertising will grow stronger over the next year as a result of the advertiser’s increase in faith in It.
AI-based bot Watson from IBM, for instance, is already popular in the UK and the US. Watson is currently undergoing developments for optimized programmatic media in buying. IBM’s vice president of Marketing Analytics, Ari Sheinkin, shared officially in one of its blogs the after-effects of programmatic media buying by Watson. It indicated a staggering 71% reduction in Cost Per Click (CPC).
2. Digital Out of Home (DOOH) combined with mobile location data.
Combined with mobile location data, DOOH is capable of redefining how advertisers/ marketers can deal with the vital last mile between the store and home, or online and offline. A direct impact is guaranteed on the scale and speed of conversions while connecting advertising and buying.
On the grounds of efficiency and scale, DOOH advances nicely to the programmatic buying model. However, the real trends in space to look out for in 2020 are:
- Integrated Home to Out-Of-Home programmatic advertising approach. This will provide a smooth going experience for customers.
- The utilization of mobile location data and integrating it with DOOH to drive conversions, especially in the offline world.
There will be a drastic shift in the coming years from just buying or trading ad spaces outdoor to estimating audience data to help in targeting the desired audiences with ads where they probably are, at any particular time. Advertiser’s budget will be more productive as programmatic in DOOH allows specific audience planning and buying. It will increase efficiency, measurements, and brand safety.
Programmatic DOOH is a medium that is good-for-all. It will provide both experimental and performance marketing as it gets more accurate with first- and third-party information from companies.
3. GDPR ultimately proves to be advertisers’ friend, not foe
General Data Protection Regulation was announced last year in Europe, After the Announcement, it looked like a setback to marketers initially. However, it is gradually turning to be beneficial. Seeking consent and guarding the privacy of user information regulation was seen to be limiting at the start, but apparently, it is resulting in reliable data and also cleaner as time goes by.
In terms of the scale of data, advertisers saw a downfall, but on the other hand, the data available was of high quality. This trend will see an improvement over the years. This is because digital platforms are adding policies along with the data privacy norms. First-party data is the cleanest and most reliable source of data for a marketer, and it has hence become more important. Brands now have the privilege of communicating directly and transparently with the consumers on the benefits of sharing their details. High quality publishers or trusted brands will not face a hard time with these regulations. Newer brands are hence expected to push a little harder to gain trust.
Cleaner data means lesser but more relevant targets. This will create mutual trust between the publishers and the customers. It also applies to advertisers and their customers. Programmatic provides the assurance of reaching out to those who are more likely to make an informed decision.
4.Voice-activated ads go beyond smart devices in the home.
The use of Voice-based in-home devices has been increasing over the years. In the past year, Amazon stated that more than 100 million Alexa-Enabled devices were sold. Customers spoke to Alexa more than a billion times compared to 2017.
Programmatic advertising has played a vital role in enabling marketers to make use of these ad spaces. This is across in-home smart devices, on-apps, and in-store audio ad opportunities. Additionally, Vibenomics, which is one of the OOH ad solutions, allows consumers to connect with brands via in-store background ads, ads in taxis and Elevators, Waiting room CCTV’s etc.
5. 5G network will enhance all forms of programmatic advertising.
The high bandwidth of 5G enhances THE ADTECH ecosystem with speed because websites or videos will process faster, enabling ads placing or delivery at the right mediums with perfect timing and with lightning speed. By 2024, the use of 5G tech is estimated to expand to 1.4 billion users. This means that programmatic advertising will have an ample audience to run sharper and interactive ads without lags across mediums.
6. Wearables’ technology will revolutionize programmatic advertising
One example of wearables is the smartwatches. Their market penetration has grown exponentially in the past few years. A report published in 2019 by Strategy Analytics states that smartwatch shipments globally rose to a whopping 44% year-on-year. This translates to 12 million units in 6-8 months.
Programmatic Advertising is already following this trend and it’s making its way towards this new medium. As the Wearable ecosystem expands, programmatic ad tech’s inherent ability to track, analyze, and optimize campaigns will attract more significant opportunities based on more accurate users and ad consumption data.
7. Blockchain & Ads.txt will continue to guard advertising.
By helping reduce the number of intermediaries, Blockchain has been able to tackle ad fraud in programmatic ad tech. The technology has also been paramount in removing domain spoofing. This makes sure that publishers are legitimate and enables transaction using cryptocurrencies. Ad reselling vendors are problematic to the advertising industry. Publishers are now enabled to host ads.txt accepted files on their servers.
8. Omnichannel or integrated programmatic ad is the way to go.
According to Forrester, omnichannel marketing is defined as the art of digitally sequencing adverts across channels. This is consistent and relevant to the individual buyers’ life cycle. With programmatic advertising, this is precisely the way to go.
9. Podacasts, audio programmatic, and Programmatic TV are all set to grow.
The move from cable to OTT (over-the-top) services such as Amazon Prime and Netflix through a screen connected to the internet (TV set) now rules the paradigm of the television industry. While the shift is still going on from traditional cable tv to OTT, programmatic advertising is tasked with making sure that advertisers get the best from both worlds.
In Podcast and audio programmatic advertising is expanding significantly. Reports by IAB and PwC are showing increased growth in podcast advertising in the US.
10. Personalization will remain paramount.
The two biggest buyer demographics are Millennials and Gen-Z generation, who love all their stuff to be customized. Personalization in advertising will become unavoidable in the future. In response, Programmatic customization is increasing. This allows marketers to offer highly personalized and relevant messaging to a target group. In conjunction with AI predictive modeling, the programmatic ad technology can serve more specific messages at the right time and place.
Programmatic Advertising Stats
A third of marketers have more data than they could ever analyze.
A survey of 260 UK marketers by Qualtrics found that 35% of interviewees stated that the data collected on their customers was more than they could ever analyze. It adds that 11% believe that mass data collection adds little value in trying to understand their customers. When it comes to the type of data that advertisers are collecting, 94% stated that they monitor levels of satisfaction. 51% said that they look at sentiments from social media and 65% said that open emails were critical in choosing the right product.
H&M is the world’s most-searched-for fashion brand.
An average of 30 million searches happens per month worldwide. At the top of the list of global favorites is the Swedish giant H&M. Zara follows next with 25 million searches while Nike, Adidas, and ASOS jointly coming third with 15 million searches each.
Burberry leads on the list of luxury British brands in the world. Followed by Victoria Beckham and Ted Baker.
49% of agencies are using their ad technology for programmatic media buys.
According to New research by IPONWEB and ExchangeWire, 49% of the entire advertising fraternity is carrying out programmatic media buying with their technology. This is enabling the agencies to gain better performance across various vital media measurements and buying criteria. The research originates from a survey of 129 programmatic professionals. The research concluded that 58% of agencies in EMEA depend on their technology while 56% used US agencies.
UK heatwave causes a 17% increase in online purchases.
Since the start of the summer heatwave, British retailers have noted an upsurge in online sales. This was primarily influenced by shoppers turning to their phones when it’s too hot to sleep at night. Nighttime online visitors to retailers increased by 26% and a general increase in purchases by17%.
80% of consumers want transparency from retailers on the use of AI.
This is to disclose how they are using technology. Come clean on its use to market products. The creepiest technologies, according to the consumers are; emotion detection rated by 58%, 57% cited facial recognition technology that recognizes a person, and sends preferences to marketing assistants. The coolest among most of the consumers were fingerprint scanning to purchase items and get home delivery.
42% of consumers say they receive one or two Amazon packages every week.
This is caused by the high demand for Amazon products. 42% of consumers state that they get one-two packages per week from amazon. The number increased to 50% for customers aged 18-25 and 57% for customers of between 26-35 years.
72% of consumers do not prefer video ads over other types of online advertising.
Despite the fact that it was predicted as a significant trend, 72% of consumers prefer different types of online ads rather than video ads. This is according to a Choozle’s 2018 Digital Advertising Trends survey. Besides, just 7% of respondents acknowledged being influenced by google home served ads, and 6% via Amazon’s Alexa. It also found that 54% of the respondents did not use ad blockers in six months prior to the survey. 43% said that advertisements affect their emotions in a negative way. Lastly, 44% said that they do not clearly understand how their private data is being used. 89% think that companies are not doing enough in keeping their data safe.
The overall number of devices in the world having an ad blocker increased from 142 million to more than 615 million.
Over 90% of marketers believe that privacy focused data training for marketers of the future is a mandatory.
The report indicates that 94% of marketers believe that a focused education on regulations of data, and how to apply them is a must for the coming generation of advertisers. Three-quarters of the marketers agreed that having this information would enhance the image of the industry while also giving the entrants an advantage in their career.
More than 50% of all digital media was programmatically traded in 2019 in Australia.
Zenith predicts an upward growth trend in the programmatic advertising digital media as Australia traded more than 50% all digital media that was programmatically traded. The video will most likely drive growth in the coming year, according to the research.