Videos lead the way on the internet. From social media updates to online streaming, people are consuming videos in ways that have never been seen before. For marketers, this kind of demand for video content means that there’s a huge opportunity for engagement with customers on a scale that’s never been reached before.
The challenge for marketers, however, is that buying ad space can be slow, inefficient, and not very precise. This is where programmatic display online advertising services and programmatic video ads come into play and revolutionize the way marketers buy ad space.
If you have ever found yourself wondering…what is programmatic video? Or how advertisements seem to trail you across the internet or appear before your favorite video on YouTube before you even finish hitting play, you have seen programmatic video advertising in action. We are here to help explain what exactly this technology entails, and why it could be what you have been missing!
Ecosystem Insights: DSPs, SSPs, and Ad Exchanges
In order to understand how programmatic video advertising is done, one must understand who the participants are. This is not simply an exchange from the brand to the website anymore. This is where technology comes in.
On one side of the purchase, we have the Demand-Side Platform, or DSP. This is software that helps advertisers automatically purchase video ad space. This is where we are creating our ad campaigns, our targeting, and our bids.
On the other side, the publishers employ a Supply-Side Platform, or SSP. This tool assists in managing available space for advertisements on websites and video streaming platforms, which is known by the term “inventory.” The SSP formulates a “request to sell” and attempts to acquire the best possible price.
Between these two is where the Ad Exchange comes in. This can be likened to the marketplace where the DSPs and SSPs actually meet. It is in the Ad Exchange that the actual purchase and sale of ad space occur, most often in a real-time auction.
How Does Programmatic Advertising Work?
It might seem complex with all the abbreviations, but the mechanics of it all are actually quite logical. It all occurs in the blink of an eye – literally in milliseconds – during the loading of a page or video.
When a user loads a website or opens an app that contains video, the SSP of the publisher will send a notification to the Ad Exchange that the ad opportunity is available. This notification will contain information about the user, such as their location, device, and demographics, which are, of course, anonymized.
The Ad Exchange transmits this data to multiple DSPs. If the user qualifies as the target audience for the campaign you set, the DSP places a bid for the ad spot. The Ad Exchange collects all the bids simultaneously. The highest bidder wins the auction, and their video ad is displayed to the user immediately. This whole process occurs automatically, ensuring the advertiser pays only for the relevant impressions.
Advantages of Programmatic Video Advertising
The benefit of this approach is efficiency. We’re no longer negotiating contracts for every single placement. This allows us to purchase across thousands of sites at once and control who views our ads.
The other advantage of targeting is the level of precision that it offers. Since programmatic is based on data, we can target our audience based on their particular interests, behaviors, and purchasing habits. Thus, our advertising budget will be spent on the people who are most likely to convert.
Additionally, the video ads in programmatic advertising allow for real-time insights. We understand which ads are working and which audience is responding. This results in immediate optimization. Perhaps the video message is not resonating well with a certain audience. In that case, we can make adjustments in real-time, instead of having to wait until the end of the campaign to analyze the findings.
Save Your Resources and Seek Professional Assistance
Although the capabilities exist, it is not easy to manage programmatic campaigns. The environment is congested with technical complexities, and without knowledge on the part of the marketer about bidding and analysis, it is easy to spend money inefficiently.
Being the digital marketing agency we are at Trigger Digital, we understand the complexities of the entire system. In fact, we take care of the entire technology implementation and the DSPs. Our goal is to maximize the ROI for you. As your partner, we would be the ones taking care of the entire video advertising distribution so you could focus on your business!