I would like to begin this article by dispelling the biggest misconception about programmatic marketing. Some experts still equate RTB with Programmatic Marketing.

The ongoing silent revolution in the online advertising landscape has its beginning in real-time bidding. What exactly is RTB? It is a relatively new model of running a campaign. In past, it was all about buying bunks of impressions and CPM (cost per mile/thousand impressions). The recent development involves an advertiser paying per one concrete impression/action generated by one concrete user.

The process of matching a specific cookie with the advertiser’s need and willingness of paying certain amount of money for reaching this cookie takes about 100 milliseconds. This is what the technology we currently have allows. The diagram below illustrates the typical RTB approach.

Is the cost lower this way? Not necessarily. It could be even a lot higher, but it is not the price that determines success in here. Highly effective targeting is a real game changer that leads to higher conversions and better ROI.

So, targeting is a key word in programmatic marketing, and it’s not how media buying transactions are made. Effective targeting of specific cookies would not be possible without the cutting edge technology and modern algorithms that pick the right information about a specific user and decide whether they are worth the money.

Let me refer you to a short clip , which is a brief introduction to programmatic marketing.

Ok, so after this short introduction we are on the same side of understanding what programmatic marketing really is. The still unanswered question is what makes this approach really effective.

The pillars of effective programmatic marketing.

Pillar no. 1 Integrated data management.

Algorithms need data to be effective. When introducing programmatic to your organization, you should first answer this crucial question: What is my data strategy?

Most likely, the conclusion will be that you have many, yet non-integrated data silos: CRM, web analytics, loyalty program, call center data, satisfaction surveys, etc.

A good partner for programmatic marketing should help you with integrating data by matching cookies with real users, offline with online data and your own data with 3^rd party sources. The more data is put together in a structure that could feed algorithms, the more effective the results will be. Our research showed how important it is to integrate local and capable 3^rd party data provider, as users are highly diversified even within the CEE region.

Pillar no. 2. One algorithm is just not enough

It is often said that if something is good for everything it is good for nothing. The same goes perfectly well with algorithms. Most of the companies offering programmatic marketing brag about how effective their algorithm is. The true is that in such complex environment, one algorithm is just not enough, and they should be adjusted for business specification and for type of media where the campaign is run.

It is not a big achievement what most of RTB players are currently doing, i.e. selling cheap CTR (click-through rate) or even CPS (cost per sale) – to a large extent all they do is just attract the same cookies that would decide to buy anyway. Retargeting may be effective, but it does not bring long term growth.

Pillar no. 3 Effective targeting of prospecting cookies.

Dedicating large portions of a budget to remarketing brings good results in boosting short-term effectiveness metrics, but fails to guarantee long-term growth. If you want your e-shop to grow, you need to effectively target prospecting cookies. What is a prospecting cookie? A one that has high probability of making a purchase in your e-shop. How do we know which cookie is prospecting one? A load of 3^rd party data gives us the information on the behavioral and socio-demographic profile of this cookie, the scope of its interest, on what it is looking for, etc. If we merge this data with database of powerful webanalytics, we are able to say if this particular cookie is similar to those that have generated a transaction in the e-shop in question. With a good partner for programmatic marketing, you are also able to feed programmatic marketing with cookies that were engaging with a display campaign: not only from the vantage point of clicks, but also post-views and dwells.

Pillar no. 4 Access to inventory.

Only the biggest programmatic marketing partners with high market coverage can reach your audience - both retargeted and prospecting - in the most effective way. In programmatic marketing capping is relatively high, sometimes involving dozens of campaign exposures before a conversion. This is why it is so important to follow your audience throughout their daily internet journeys. So the chosen programmatic provider should be connected to all global and local ad exchanges enabling advertisers to appear anywhere the contemporary and potential clients could be.

Pillar no. 5 Omni-channel approach.

“Mobile” is not the buzzword any more. In the most developed market that Gemius is measuring, Denmark, the total amount of page views generated through mobile devices has already exceeded the PC results. The same tendency is being observed in the CEE region. Users are massively using all possible access points to the internet, so it is impossible to be effective without the omni-channel approach and cross-channel retargeting.

Pillar no. 6 Personalization.

What is happening on your website and with your own systems should also be a part of your strategy. On each end every possible level, try wish to to target your actions to particular user/cookie. Personalized recommendations, personalized landing pages, automated mailing campaigns, to name a few, are all crucial to effective programmatic marketing. And here we come back to pillar no. 1 – integrated data management - without which none of the above mentioned systems will reach its real potential.