The language of mobile programmatic advertising

Mobile programmatic buying and selling is set to be the hottest advertising technology topic of 2014. Considering we have not even reached the end of February yet, you would be forgiven for arching an eyebrow and asking ‘why so?’

Programmatic advertising – the automation of buying and selling digital advertising inventory generally using real-time bidding (RTB, which we’ll get back to shortly) – is already a multibillion-dollar discipline. 

Already well established in fixed web advertising, the Interactive Advertising Bureau says: “Approximately 20 per cent of all digital advertising is sold by one machine talking to another machine – and growing rapidly.”

So what’s so special then about programmatic when it comes to mobile? Programmatic thrives on data, leveraging pre-set rules determined by some clever algorithms to respond to masses of data in real time. 

That data is being created by your customers every second of every day, and it can tell you about their many likes and dislikes, loves and loathes. 

It is no secret that, when it comes to engaging your customers, the richer the data the higher the return – and when it comes to rich data, there is nothing that comes close to mobile. 

Making its way in mobile

Unlike the fixed display advertising world, mobile is still a relatively new string to the programmatic bow, albeit one that is generating a lot of interest. For advertisers and brands there are advantages with mobile that the fixed world is just not able to provide. 

Thanks to the highly personal nature of smartphones and tablets, brands can establish what is relevant to a consumer at the moments that matter most, throughout the month, the day and even the minute. 

As programmatic advertising grows in the mobile world, brands will be able to reach their target audiences at those precise moments, in real time and at scale. 

In turn, mobile programmatic is forecast to be worth serious amounts to the advertising world. According to eMarketer, which upped its revision for the second time in only three months at the end of last year, global mobile programmatic spend looks set to increase by over a third (38 per cent) in 2014, to $4.66bn (£2.81bn). Some forecasts are even more aggressive.

With such hype, however, comes significant confusion. With a seemingly interchangeable terminology regarding programmatic – RTB, premium programmatic, DSP, and SSP, to name but a few of the buzzwords making today’s headlines – brands can feel overwhelmed by these new technologies. 

But what do all these terms surrounding programmatic advertising mean to you, and how are they able to help you to get the most out of mobile programmatic advertising campaigns? 

Talking the talk

There are a lot of acronyms and technology terms to contend with when it comes to mobile programmatic. To run a successful digital campaign, marketers need a good understanding of the language of programmatic. 

• Programmatic buying: Starting from the top, programmatic buying enables advertisers to bid on and procure digital media inventory on a per-impression basis through an ad marketplace, without having to pre-negotiate on price, budget or impressions. 
• Mobile exchange: Numerous advertisers can compete, but ultimately one will win within the parameters of their pre-set rules to earn the right to serve their ad. The marketplace is the mobile exchange, where buyers and sellers purchase and sell individual impressions on a real-time, auction basis. 
• Real-time bidding (RTB): Back to RTB. Put simply, this is a method of selling and buying online display advertising in real time, one ad impression at a time. Compared with traditional segment-based buying, RTB helps advertisers to move beyond positioning ads to a potentially diverse segment and instead realises the potential for one-to-one marketing at scale. 
• Demand-side platform (DSP): When buying digital ad inventory, what happens if you want to go through more than one exchange? A DSP allows buyers to reach consumers across multiple ad exchanges and networks with one interface. RTB takes place within each exchange and by using a DSP, marketers can manage bids and pricing for the data that they are layering onto their target audiences.
• Supply-side platform (SSP): Mobile programmatic is not just about buying, it is about selling the inventory too. An SSP enables publishers to manage advertising inventory across multiple mobile exchanges, networks and their direct deals, by automating and optimising the selling of their media space. This helps publishers to sell their impressions to the highest bidder and access thousands of new advertisers.
• Premium programmatic: Finally, another important term for marketers to get to grips with in the world of mobile is premium programmatic, which focuses on high-quality premium inventory available programmatically to achieve click-through rate, conversion and eCPM (effective cost per thousand) results that are comparable to guaranteed purchases. 

By marrying sophisticated targeting capabilities with extensive publisher relationships, mobile is now able to bring the same quality inventory that advertisers can buy in a full-service environment into the programmatic space. 

The programmatic opportunity

Beyond the many acronyms and the technical terminology, though, mobile programmatic above all presents an opportunity for brands to pay only for those consumers that they want to reach. 

It also provides brands with the flexibility to quickly view performance and easily move around their budgets to maximise interactions and conversions.

We could, very easily, go on. In a space where there is so much more to come, we must grow as an industry as the technology itself evolves, although undeniably there is still a lot to get to grips with.

Collaboration, clarity and education in the programmatic landscape will help to drive digital advertising spend – of which mobile is a big part.