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Programmatic Advertising: Pros and Cons

Programmatic Advertising: Pros and Cons

Programmatic advertising is the buying and selling of ad space in real time. It is becoming increasingly popular in the digital advertising world. It is, essentially, a computer algorithm that buys and sells advertising space in real time. It’s seemingly efficient, both financially and timely, but there are also drawbacks that we’ll discuss in this blog, from both the publisher and advertiser point of views.

Pros:

Publisher

Unlimited demand sources
With programmatic technology, the amount of potential buyers is unlimited, as more and more advertisers look to buy inventory space and traffic programmatically. This means for publishers there are more opportunities to generate more revenue from their websites.

Ads more targeted to your users
Due to the criteria that can be set, publishers will get adverts that are relevant to their site and needs. The bidding process will use their criteria and only purchase relevant, targeted ads. If the publisher only wants iOS adverts in India, then the programmatic technology will place iOS adverts that are geo-locked to India, increasing the user experience and flow of the publisher’s site.

Less optimisation time required
Algorithmic advertising means that there will be minimal human input, aside from the initial criteria settings, but will produce maximum performance. With that in mind, employees can be utilised in other areas that can be beneficial to the publisher’s company.

Advertiser

Uses real time data to find ad space
Since programmatic buying is done in real time, it can use real time data from users to match targeted ads to them. By using real time data, the likelihood of buying wasteful or incorrect traffic is reduced, once again saving time and money for the advertiser.

Efficiency
Programmatic ad buying will use the criteria the advertiser sets, such as geos, devices, etc. And it will search and find the right traffic required to fulfill these criteria. If the advertiser sets a cost limit, then it will also find traffic within a chosen budget; this can help save on ad spend, all with the benefit that the ad has reached a target audience.

Allows laser targeting
Through the use of programmatic technologies, advertisers can be increasingly specific with their targeting; some services, like Facebook and Google, offer laser targeting. This allows targeting based on what these services offer as ‘super accurate’ details leading to increased user engagement.

Cons:

Publisher

Non-guaranteed fill
Almost exclusively, programmatic tags don’t deliver 100% fill rates. This essentially means that although a publisher’s tag will request an ad when a user visits their page, there won’t always be an ad to show them. Traditional ad space selling often meant that publishers were offering a ‘roadblock’ on their properties, meaning that effectively every ad spot is filled. With programmatic the process is more dynamic, meaning that if there isn’t a relevant ad, the space won’t be filled. In addition, it’s usually not the publisher hosting the ad, so even when an ad is available, it may not fill the ad space if the user navigates away too quickly or has a bad connection.

No control over which adverts come through
Even though an advertiser can set criteria so that their ad fits in with a publisher’s audience, there is no guarantee that the advert is relevant to the publisher’s users. In the bidding process it’s the advertiser that ultimately chooses where they place their ad. Whitelists and Blacklists can help but in the end the publisher will end up with an ad that they have little control over.

Advertiser

Bot traffic
Bot traffic may account for some of the traffic available through programmatic advertising opportunities. This is the nature of any internet traffic nowadays, but using programmatic ad buying, potentially, increases that risk of bot traffic because dynamic ad buying means that there is usually no direct relationship between publisher and advertiser. However, the world of programmatic advertising is constantly working on finding ways to eliminate bot traffic and with new service providers in this area, the technological advances of eliminating bot traffic is looking promising.

Laser targeting can be expensive
Although we’ve discussed the pros of laser targeting, it is worth mentioning that to get that amount of specification for laser targeting does not come cheap. Getting your ad to play to exactly who you want, down to every last detail, can be a very expensive process and as with any user there is ultimately no guarantee that they will respond to the ad.

 

Conclusion

There is always going to be cons to any ad buying solution, and programmatic is no different. If advertisers want cost and time efficiency and large amounts of traffic that can be tailored for their targets, then programmatic ad buying might be exactly what they need. AdSpruce helps publishers and advertisers to make the most of advertising, whether it’s programmatic or traditional direct placements. Visit the AdSpruce website to get in touch with one of our mobile advertising experts today.

For more information on programmatic ad buying and all things mobile advertising, visit the AdSpruce website here. Or follow us on social media, @AdSpruce, Facebook page or Google+.