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Mar 15, 2018

The Rise of Programmatic Advertising and Its Impact on eCommerce

Stop by the Springbot blog to get some insight to the world of programmatic advertising, including information on how it’s set to shape the eCommerce world as well as some of the common problems with the software.

Remember the time when you actually had to hire someone to place your ads? These days, companies are investing a lot more in marketing solutions that eliminate human error, inefficiency and time-wasting, like programmatic advertising.

Artificially intelligent ad-buying robots are probably the future of advertising but don’t go firing your marketing team just yet. You still need real workers to strategize, optimize and add a human touch to your ads. Plus, there are still a few kinks to work out.

Programmatic advertising employs digital advertising software to buy ads on auctions, sometimes using real-time bidding. It may sound a lot like a long-winded explanation of automated software, something we’ve long used in the digital enterprise, but industry experts are at odds with the official nomenclature.

On one hand, automated ad buying sounds more straightforward and less hands-on. Still, programmatic ad buying has come to represent automated software specifically within advertising, so it feels more descriptive for marketing teams.
It doesn’t really matter what you call it, so long as you understand that it’s something you should be using if your company relies on digital marketing. The widespread acceptance of programmatic buying — and artificial intelligence as a whole — is seriously shaking up the eCommerce world, for better or for worse.

Artificial Intelligence (AI) has the power to spot fake reviews, deliver customer-tailored product suggestions and provide customer support via chatbots. It can also take care of some of the heavy lifting in the advertising department.

 

It Will Make Data Even More Important

Just when you thought you didn’t need one more reason to invest in a data-driven marketing approach, programmatic advertising comes along. Automated software is smart, but it relies on large quantities of data. Your media buying efforts are for naught if you don’t spend the time gathering metrics on different demographics.

The data will let your digital ad buyers promote and create custom, targeted campaigns so you get more ad impressions and conversions. You can use eCommerce analytics by Springbot to gather these key data points and see how you measure up against the competition.

It Will Make Things More Personalized

Advertisers and publishers have long looked for ways to make advertising more personalized. In fact, 71 percent of consumers prefer personalized ads, with nearly half citing the fact that a reduction in irrelevant ads is its greatest benefit.

In the world of eCommerce, artificial intelligence and big data will help further play to the shopper’s desire for tailored content. From data-driven product recommendations to individualized display ads, AI is already clutch for a personalized user experience. Programmatic online advertising is only set up to bolster that.

It Will Make Things Easier for You

We don’t think that programmatic technology will replace in-house teams. But we do think it has the capability to seriously shake up the advertising space so that you might not need as many employees on board. New programmatic solutions are picking up a lot of the slack for the everyday e-marketer by intelligently automating ad exchanges, discounts and even A/B testing.

It Will Make Advertising More Cost-Effective

We mentioned earlier that this kind of display advertising could be performed in real-time. Contrary to popular belief, not all programmatic ads employ real-time bidding (RTB) protocols. RTB is a kind of programmatic advertising protocol for automatic bidding, placement and purchasing of ads in an auction format, like Google AdWords or the auction platforms on Facebook, LinkedIn and other social media sites. These technologies can help improve your click-through rates while maximizing ROI.

The Caveat

There is one downside to note about programmatic advertising. In September, AdWeek reported that a third of all programmatic impressions are likely fraudulent. In other words, your ad campaigns that appear successful may not perform as well in real-time. Ad fraud is said to affect real-time bidding more than direct programmatic purchasing— the act of buying guaranteed impressions in advance. Plus, you’re probably more likely to fall victim to it when you place a video ad versus another kind of online marketing.

Despite this, Forrester predicts that AI investments will gain businesses an estimated $1.2 trillion per year by 2020. While developers and ad platforms iron out some of the big issues associated with programmatic buying, we can’t afford to sit back and ignore the technology as a whole. There are many ways, like programmatic ads, that artificial intelligence can help, so it’s not a bad idea to spend some time looking into new AI solutions for your online business.

Interested in exploring ways to automate your online marketing efforts? Schedule a chat with one of our eCommerce marketing experts to get started.


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