Programmatic Media Buying

Spotlight on PROGRAMMATIC MEDIA BUYING

Presented by

ADVANCING MARKETING EXCELLENCE

The 5 Myths of PMB, Dispelled SHEDDING LIGHT ON SOME COMMON MISCONCEPTIONS

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PROGRAMMATIC IS HOW PMB IS FUELING WHY MARKETERS

SCARY GOOD THE AUDIENCEEmbrace-Programmatic_Collective_FINAL3_print.pdf ENGINE 1 7/15/14SHOULD 4:22 PM EMBRACE PMB PAGE 5 PAGE 7 DIGITAL EXCLUSIVE

ISSUE 8 :: 2014

CMY

K 2 algorithms toguide mediabuying the useofprogrammatic softwareand over thepast12to18months is that effective waypossible. target consumerinthemostcost right messageisdeliveredtothe right buying processinordertoensure the layered overdatatoautomatethead that programmaticbuyingusessoftware however, there’s generalagreement constitutes PMB.Forthemostpart, even somedebateoverwhatactually much confusionasithashype.There’s and itsadventhastriggeredalmostas B

The onethingthathasbecome clear ::

Issue 8 (PMB) forseveralyearsnow— programmatic mediabuying uzz hasbeenbuildingaround ANA Magazine Spotlight

Here’s the reality behind some of programmatic media buying? media programmatic Dispelled The The common misconceptions common

Still in the fog over

PMB strategies andcombining themwith out thatbyembracing programmatic 13 percentconsideringsucha move. programmatic buying,withanother capabilities tomanageandimplement said theyhadexpandedtheirin-house percent ofthemarketersin survey Perhaps justasimportantisthat25 programmatic buyinginthenextyear. an additional18percentplanningtoadd surveyed saidtheyhaveusedPMB,with 54 percentoftheclient-sidemarketers Marketers,” releasedearlierthisyear, “Media Buying’s EvolutionChallenges the ANA/ForresterSurveyReport advertising community. Accordingto decisions isgainingmomentuminthe Brands largeandsmallhavefigured

5 By DavidWard

Myths

appear to have PMB well figured out, appear tohavePMB wellfiguredout, customers atscale.” help usproviderelevantmessaging toour important tous.Ourprogrammatic efforts that wedoandtheirshoppingchoice is customer isatthecenterofeverything ing andsocialmediaatWalmart. “The Hoehn, seniordirectorofdigitalmarket interesting ways,”explainsThomas today andputtingthemtogetherin leveraging thetoolsthatareavailable at theperfectmoment. better waystodeliverprecisemessaging costs anddrivesROIbutcanprovide potent combinationthatnotonlycuts big dataandanalytics,theyhavea While afewcompanies likeWalmart “Programmatic, forus,isabout , www.ana.net -

THINKSTOCK many marketers and agency professionals opportunity to do just that, especially as the exchanges, we’re now able to buy are still on a learning curve to get a more premium content sites open their regular or even highly desired media sophisticated understanding of what PMB ad inventory for PMB. space in the programmatic world.” is all about, and grasp how it can help Ron Amram, senior media director at Amram adds the ability to integrate their branding and messaging efforts. Heineken USA, notes that, as an alcohol data analytics into these PMB strategies Here, we dispel five common myths advertiser, he has to be very careful about is giving brands more ways to gauge and misconceptions surrounding where he advertises and who interacts how they and their messages are being programmatic media buying. with his brand. As a result, Heineken is perceived by consumers. “When you layer almost exclusively focused on targeted in data stacks on top of [PMB] — every- Programmatic Doesn’t messaging — but has found that PMB thing from brand awareness to intent-to- Work as a Brand can play a positive role in its marketing. purchase data, even sales data — you “From a premium brand or upscale can now measure how media are being 1 Awareness Tool brand, programmatic was initially either effective in very specific KPIs,” he says. While not every brand is using program- not very effective or not an allowable way “It’s not just clicks or likes anymore.” matic as part of their traditional brand to spend your dollars,” Amram says. The move toward using PMB for brand enhancement/awareness efforts, an “But now that more inventory from awareness is already being felt at the increasing number of marketers are premium content sites have become agency level, adds David Staas, president discovering that PMB presents a valuable available on programmatic platforms and of San Francisco–based NinthDecimal, www.ana.net ANA Magazine Spotlight Issue 8 :: 3 which provides audience-targeting tools developed by our Walmart Labs team, to is leveling the playing field, but most for traditional mobile and mobile video optimize our spend in real time.” importantly, it drives efficiency and advertising campaigns. “Until recently To show just how creative companies performance regardless of budget size. It programmatic was definitely in the realm can get with PMB, Hoehn adds that lets advertisers iterate much faster, within of direct response,” he says. “But we’re Walmart is doing some very interesting seconds, ending campaigns that aren’t hearing there’s a lot of pent-up demand on programmatic buying based on weather performing and doubling down on ones the branding side, not only with the agency triggers. “This effort spans media that are. With programmatic, measuring trading desks but with the brand teams channels that include display but also ROI is real time and actionable. These are we work with. Many agencies are begin- social, mobile, and cable TV,” he all things that make advertisers’ jobs easier ning to have that programmatic expert says. “We can be extremely precise in and their marketing more effective.” embedded with their branding teams.” the delivery of messaging based on the And it isn’t just digital. PMB, combined analysis of weather patterns combined with data, is already pushing its way into Programmatic with our historical sales data.” traditional ad venues and is expected to Is a Digital Display To their credit, many of the leading affect the advertising landscape in TV, social media sites and search engines radio, and even print. 2 Phenomenon have welcomed programmatic, says “The obvious one is TV,” Amram says. This myth may have actually been true as Heineken’s Amram, citing heavyweights “Because if you have excess supply and recently as mid-2013. But since that time such as Facebook, Google, and Twitter, you go down the programmatic route you PMB has migrated quickly to other ad which are now using PMB as a way to can potentially find a way to benefit and platforms, including mobile, social prove their worth as advertising platforms. get advertisers on board and potentially media, and more traditional ad venues. “Though they try to control it, they have measure the effectiveness of your ads and Even traditional brands like Walmart completely embraced programmatic — show you’re very valuable. Programmatic are finding creative ways to leverage PMB and the data stack,” Amram explains. does give you a better understanding of to build a sophisticated presence on “They’re almost fearless in how they allow where your advertising should go and social media and search platforms. advertisers to measure the effectiveness of whether that should be a digital stream or “We use programmatic approaches to the advertising on their platforms, where a television stream. So we’ll quickly learn deliver messages beyond display,” says traditional media companies would be what stream is effective and where we Walmart’s Hoehn. “We find that it is the scared out of their minds to do what these want to spend more of our money.” most effective way to message at the scale companies are doing. You can get a report we require. For example, we have more that shows you how your media is doing on Programmatic than 4,000 Facebook pages — one for their platform and you have the ability to Is Only About each store — and we augment messaging immediately turn it on or off — but more that comes directly from the store itself and more advertisers end up spending 3 Cost Savings with automation. These can drive locally money on these platforms because they This myth also may have had some truth relevant product messaging based on can prove their effectiveness.” initially, as marketers found that using location, weather, inventory levels, and David Jakubowski, the new head of PMB cut their media buying expenses, more. Search is another area where Facebook’s advertising divisions, adtech which ended up boosting the ROI of their we have very sophisticated methods, and Atlas, agrees, noting, “Programmatic ad spends and making their bosses happy.

Heineken has used PMB to ensure its messaging hits adult audiences, while Walmart uses programmatic to serve relevant messages on Facebook based on location, weather, store inventory, and more. COURTESY OF HEINEKEN, MOBILE WALMART, MARKETING ASSOCIATION

4 :: Issue 8 ANA Magazine Spotlight www.ana.net But as an added bonus, many marketers are finding that PMB along with data analytics is helping them better reach CASE STUDY the exact target audience they want. As Florian Gmeiner, head of marketing for the Americas at Lufthansa, notes, Programmatic Is “Ultimately, programmatic will increase the effectiveness of Lufthansa’s digital efforts because the use of the technology and data allows us to target the audience we want to hit. I see programmatic as an important piece of the mix but feel it needs SCARY to earn its way into truly and effectively delivering against actual audiences, not only computer reported ones.” Hoehn of Walmart agrees that PMB can’t simply be judged by its ability to GOOD reduce media buying costs. “As we optimize we may actually spend more, How Universal Pictures used PMB not less, to reach the right audience. It is to promote the home release of ParaNorman no longer about large-number impressions — it is about the right impressions,” hen Universal Pictures sought to generate awareness for the home he says. “We are in an age where we W release of ParaNorman, the critically well-received stop-action ani- can absolutely optimize our spend, mation movie that had generated more than $52 million at the U.S. box but, more importantly, deliver messages office, it turned to London-based Adfonic (which earlier this year changed that are relevant and helpful to our its name to Byyd) to develop an effective media-buying strategy targeting customers.” parents, teens, and fans of horror, comedy, and animation. “The ParaNorman campaign was a classic example of using program- Programmatic Will matic to improve efficiency and therefore boost ROI,” explains Victor Mark the End of the Malachard, Byyd’s cofounder and chief executive officer. “Where other models, such as blind ad networks, fail, programmatic can continue to 4 Traditional Ad Agency grow because [when plugged into a mobile Demand-side Platform (DSP)] Earlier this year reports began circulating clients gain huge reach instantly by simply plugging into exchanges, at that CPG heavyweight Procter & Gamble which point they see all requests and can decide which ones to bid on. (P&G) would begin to make upwards of This transparency means they can be more effective by adapting cam- 75 percent of its digital display buying paigns in real time.” through programmatic channels. Malachard stresses that programmatic buying alone wasn’t responsible While P&G did not confirm or deny the for the success of the ParaNorman campaign; great creative in the form reports, the rumors alone — combined of rich media video from Universal Pictures was edited both for mobile with news that both Kellogg and Apple and to reduce the time from impression to conversion. Each ad page would bring more of their advertising for ParaNorman provided very clear branding and was designed so that in-house — triggered real concern that users knew exactly what to do next: either watch the video or visit the programmatic would end up reducing the iTunes store. role traditionally played by media buyers The decision to go with mobile content in a rich media format was and ad execs. crucial in helping consumers quickly grasp why ParaNorman was a Some of those worries are valid, but movie worth renting or downloading, Malachard points out, adding that most are premature in that they ignore superb creative combined with PMB proved to be an explosive mix. the resiliency of advertising agencies and “When we performed post-campaign analysis, it showed we achieved media buying firms, which have long click-through rates of 40 percent, stronger than average for mobile — proven they are capable of adapting to and that was independently confirmed,” he says. “And our cost-per- changes in the ad ecosystem. engagement figures were less than a quarter of typical desktop campaigns. “The industry is at an interesting These are compelling bottom-line figures that prove programmatic mobile juncture,” Hoehn says. “The media buying works.” — D.W. landscape is evolving in this age of big www.ana.net ANA Magazine Spotlight Issue 8 :: 5 data and those that don’t change and Brian Wieser, senior analyst at New creation of smart, strategic, well-defined adapt, well ... let’s just say they won’t be York–based Pivotal Research Group, also campaigns that live off constant optimiza- sustainable.” cautions against reading too much into tion will be every brand’s goal.” Hoehn goes on to say there is plenty of some of the moves by individual brands. room for all kinds of new professionals in “Agencies are always trying to take on Programmatic this industry and that even with PMB, more analytical and strategic roles, but Damages Premium just because marketers can bring programmatic trading in-house does not 5 Publishers the Most PMB could play mean that it ends up being that way — Initially grumbling that PMB was putting or that the advertisers who have gone downward price pressure on their ad an indirect role through this process will keep things that inventory, top-tier media companies — way,” Wieser says. “There are still many including The New York Times Co. and in improving the challenges to be managed, and at the Washington Post Co. — have all now hired content available same time, there will be bulk deals for programmatic ad executives to guide their inventory between agencies and publish- sales staffs in how to take advantage of the to consumers or ers which incorporate programmatic rise in brands using PMB. execution at lower prices than many of But several of the brand executives and in how that content these marketers could get on their own.” advertising experts we spoke to suggested Lufthansa’s Gmeiner suggests that the that PMB will actually separate out what is is presented. advent of PMB could even become a truly premium content from the also-rans. catalyst for a new era of collaboration The hard reality, Wieser explains, is brands will continue to need and seek among the players that make up the that, “some ‘premium’ sites aren’t really out great marketing insight. “If you aren’t advertising world. “The media agencies, that important, and their pricing will be dealing with capable people, processes, creative agencies, and technology constrained. Others, which are perceived agencies, creatives, analysts, etc.,” he providers need to sit at the table much to be premium, will be fine.” says, “‘programmatic’ can also mean that more often,” he says, adding that inside Gmeiner notes that with larger premium you deliver the wrong message to the the brands, programmatic and data ad inventories now available programmati- wrong people at scale and, before you analytics will bring the sales and marketing cally, more brands are looking to PMB. know it, your campaign budget is gone.” departments much closer together. “The But, he stresses, that won’t push marketers to completely abandon other programs Lufthansa is one of many brands beginning to use programmatic media buying to boost the returns on its digital marketing efforts. like sponsorships that partner the right brand with the right top-tier content. “The proliferation of programmatic offerings from more premium publishers will become a bigger part of the investment strategy, but by no means will this diminish the importance of custom content, high impact executions, and sponsorships,” he says. “So the need for having a brand message in a high- reaching, contextually relevant environ- ment will continue.” PMB could play an indirect role in improving the content available to consumers or in how that content is presented. “Premium content destina- tions should certainly be able to continue if they pay attention to the choices their audiences are making. If they can deliver an audience that is well defined and accessible, I don’t see an issue,” Hoehn says. “Great content will always be a draw. Marketers will have interest in that and

will want to participate.” ■ COURTESY OF LUFTHANSA; THINKSTOCK (ENGINE)

6 :: Issue 8 ANA Magazine Spotlight www.ana.net PROGRAMMATICPROGRAMMATIC FUELSFUELS THETHE AUDIENCEAUDIENCE rogrammatic media buying (PMB) appears extraordinarily P fragmented compared to buying ENGINEENGINE digital media directly from a publisher. That’s because your campaign runs on impressions from publishers across the How PMB is empowering marketers to web, on every device. connect with the right consumer every time The breadth and diversity of this inventory can be quite intimidating. By Justin Evans How do you make sense of this fragmen- tation, take control of your buy, and leverage PMB to your best advantage? The answer: through your audience. Finding the right audience is at the heart of PMB; it’s the element that unifies the buy. When programmatic is executed well, it enables you to precisely reach only your desired audience, minimizing wasted spend. You’ve worked hard and allocated enormous resources to figure out who your consumers are. Buying programmatically simply empowers you to engage them — and only them — with your message. The Evolution of Audience Targeting To understand how targeting your audience across content can help drive conversions, let’s go back to its roots. The concept of audience targeting comes from direct marketing, where consumers’ relevant characteristics (like automobile registry data on who owns a luxury car, or aggregated credit information about who is a good risk for a credit card) were linked with their contact information (like postal addresses) to form a database of consumers more likely to be interested in a brand’s products. >>

ANA Magazine Spotlight Issue 8 :: 7 The result may have been annoying — targeting across online display and video, junk mail in the mailbox — but it was television, and mobile. Virtually all these delivered thoughtfully, with metrics like screens and formats are accessible to PMB. “open rate” that allowed marketers to use the channel effectively and efficiently. Sources of Targeting Data Around 2008, marketers began incor- The types of information available for porating audience targeting — from offline targeting are as nuanced as humans and online sources — into banner ads. themselves. Information can come from How did they do it? Data companies several sources: created match networks that linked their • CRM data, sourced from a brand’s low side and 75 percent on the very high consumer databases to browser cookies. own databases of offline purchases or side, so that erosion will take place. The match networks consisted of web e-commerce shopping and browsing. publishers who, for a fee, anonymously • Past purchase data, aggregated Managing Audience Data linked data attributes such as “owns a across sales channels by third-party Brands should employ certain strategies luxury car” to browser cookies. companies. to manage the challenges and capture In 2010, after the Interactive Advertis- • In-market data that either models the opportunities of audience buying ing Bureau established video standards past purchase behavior (“it’s time through programmatic: for the digital ecosystem, these data- for household XYZ to buy another • Validation. To manage the risk of targeting assets could also be deployed sedan”) or collects signals from digital inaccuracy, brands should test for digital video, or broadband, advertis- shopping and product research that their data providers using a market ing. Extending these capabilities into TV indicates an impending purchase. research company or panel, and and mobile was more difficult. • Rich demographic data is also avail- compare the results of different In the years between 2008 and 2013, able both from offline and online data providers. several cable and satellite companies companies. This information covers • Modeling for Scale. Brands should adopted advertising technology that more than age and sex, to include choose technology partners who enabled TV targeting at a household level. factors like ethnicity, income, credit- have the capability to build machine- While the process and technologies have worthiness, education, etc. learning models to expand the reach matured, the reach of these technologies of the data they use outside the foot- These data sources combine to paint print of the standard match partners. a rich portrait of an audience who, if they • Consistency Across Screens. Now Finding the right had been targeted through multiple that an element of consistency is audience is at publisher buys, might be prohibitively possible across television, desktop, expensive to reach. Yet, purchased and mobile, brands should seek out the heart of PMB; programmatically, a brand’s chosen partners who can provide the reach it’s the element that audience may be aggregated into a single and coordination afforded by new buy, and made accessible through technology. unifies the buy. technology as if they were the audience for a single publisher or network. Employing these tactics, your PMB is still limited to some 20 million house- should enable your ad to run in diverse holds, a fraction of the 116 million TV Challenges of Audience Buying types of content, platforms, and devices, households in the U.S. While this process has evolved greatly so you can find the luxury auto owner Mobile was a notoriously difficult in the past six years, there are still while he’s researching his next car on his problem for marketers focused on challenges. First, the data you use is tablet, the stay-at-home mom who is audience. The scramble of web and app only as strong as its source, and virtually searching for the perfect vacation ad inventory was further complicated by any source will have flaws: data may be destination on her laptop, and the the different standards of the Apple, stale or outdated; it may be modeled millennial looking at different lipsticks Android, and other operating systems. and hence contain a margin of error; and on Sephora.com on her iPhone. This is Only since (roughly) 2012 has a targeting through the many handoffs between how you programmatically reach the technique known as “statistical IDs” the data source, match partner, and right audience at the right moment — allowed marketers to extend their media platform, it may be matched anywhere and everywhere they are. ■ broadband audience targeting capabili- improperly. ties into the mobile ecosystem. Second, data may lack scale, which Justin Evans is the chief strategy In 2014, marketers now enjoy a wide will inhibit reach. Database matches are officer at Collective. Email him at scope of opportunities for audience prone to match rates of 30 percent on the [email protected].

8 :: Issue 8 ANA Magazine Spotlight www.ana.net How to Stop Programmatic from Being Problematic PMB may involve automation, but diligence and hard work are still required to get it right By Travis Lusk

rogrammatic media buying (PMB) incredibly damaging to advertisers and transaction. Part of what makes program- can make ad purchasing, targeting, the ecosystem as a whole. While large ad matic appear “automatic” are the many P and delivery simultaneously more buys can be initiated easily and instantly, middlemen involved. In every transac- granular, efficient, and scalable, removing so can large-scale manipulation. tion, there are between three and 10 of vendor-by-vendor negotiations and cum- them (e.g., exchanges, demand-side bersome ad operations. But this power Clarity Is Crucial platforms, ad servers, verification and flexibility come at a price. If you’re not How can you combat the dangers inherent vendors, data vendors, etc.). Each takes careful, you could be clicking ad dollars in PMB? You must be on your game and a cut of every programmatic dollar and into the void without really knowing what pay attention to exactly what is being they get paid before the publisher. The you’re buying. In short, programmatic promised versus what is being delivered. percentage that eventually reaches buying can be problematic buying. Demand that third parties provide the publisher will give you a clue about The truth is, to realize its promised ROI, detailed insight and reporting regarding the quality of the impression. If one programmatic requires at least the same impression delivery. Are your ads publisher receives 30 cents on the dollar level of attention and commitment of reaching their intended target in a fully and another receives 50 cents on the resources as traditional media buying. viewable context? Or are there suspicious dollar, all other things being equal, the Your team will need to work diligently and geographic, chronologic, or behavior first publisher’s impressions are likely strategically to ensure that you’re actually patterns that indicate potential abuse? lower quality — even though you might receiving the quality of impressions that You can employ a specialized verifica- be paying exactly the same amount. you’re paying for, and not pouring money tion vendor, such as Integral Ad Science By now, you’re probably beginning to into a black hole of click bots and for display ads or Vindico for video ads, to realize that PMB isn’t as hands-free as it fraudulent impressions. help ensure that you’re getting impres- might seem. None of this is meant to sions with quality that matches the cost. scare advertisers away from embracing The Cost of Efficiency Even when relying on verification the opportunity that PMB offers, but only Due to the lack of policing in an open vendors, your team must still diligently to serve as a reminder that with power exchange (i.e., when buying program- analyze data at the log and impression comes a responsibility to engage matically), you’re exponentially more likely level to ensure that your ads are running proactively and strategically with third to log impressions that aren’t viewable on the correct domains and that you’re parties, or risk wasting your time and and/or are based on fraudulent traffic. truly hitting your goals. money. ■ According to Incapsula’s “Bot Traffic Report 2013,” non-human traffic makes Follow the Money Travis Lusk is vice president, head of up more than 61 percent of all website Programmatic buyers also need to be video at Collective. Email him at activity. Clearly the resulting fraud is more aware of the economics of the [email protected]. www.ana.net ANA Magazine Spotlight Issue 8 :: 9 Programmatic AD BUYING FOR THE DIGITAL AGE 101 By Adam Harris

n its short life, programmatic media negotiate a price for a set number high concentration of your target buying (PMB) has attracted more of impressions. This method of demographic, say, men ages 20–34, I attention than almost any form of buying is completely based on on the site. advertising this century. content. In other words, you’re 2. Ad Network. You can buy impres- Programmatic spend this year is determining where to buy ad space sions from an ad network that projected to reach $7.4 billion, accord- based on which content the ad will aggregates content across different ing to Magna Global. Just three years run adjacent to, or within, and you publishers. You still buy based on a from now it will jump to $17 billion and, pay a premium for the placement. set price per thousand impressions by that time, is expected to drive the One reason that brands may be (e.g., CPM) but the ad network vast majority of display, video, and content-focused is to capitalize on might not fully disclose all the sites mobile ad buys. the halo effect, when consumers that wind up on the buy. On an ad Why has digital programmatic buying have a positive bias toward products network you can target your buy commanded such popularity — and because they’re advertised within based on either content or type of money? Through the use of the technol- highly regarded content. And content person. The sneaker brand, for ogy that is at the heart of programmatic, can serve as a proxy for an audience, instance, might buy impressions in advertisers have unprecedented power meaning that the brand aims to sports-related content across the to efficiently purchase the audiences find a concentration of people within network or it might buy impressions most likely to become consumers. a certain demographic who go to a that are viewed by men ages 20–34. particular site or watch a specific 3. Programmatic. You can use The Digital Ecosystem piece of content. For example, if programmatic technology to buy the To fully leverage the PMB trend, you you’re a sneaker manufacturer, right audience at a more efficient have to understand the three different you might want your brand to be price. Again, you can target by ways to buy digital media: associated with sports content and individual or content, but the 1. Publisher Direct. You pick up the buy space on ESPN.com. Another process is very different from buying phone and call your rep at a reason you might buy space on through an ad network and has

publisher, like ESPN.com, and ESPN.com is because there’s a distinct advantages for advertisers. THINKSTOCK

10 :: Issue 8 ANA Magazine Spotlight www.ana.net Programmatic Revealed characteristics and behavioral data, you your historical cost per conversion, or Programmatic buying operates on an connect with more of the people most cost per thousand in-target impressions? exchange that’s similar to a stock market. likely to convert. Last but not least, you Brands need to set benchmarks and Ad impressions (stocks) are available to can buy programmatically across all track them relentlessly. be bought and sold and the price is digital screens — from desktop to Advertisers using programmatic trade negotiated between the advertiser (buyer) mobile — and reach your audience control over their money for the invest- and publisher (seller) on the exchange. wherever they are. ment required to maintain control. Does The buying process is called real-time your company want to license program- bidding. Advertisers bid against each The Business Opportunity matic media technology directly? Would other in real time, in an attempt to Brands that embrace programmatic you prefer a managed service where a purchase — at the lowest possible should expect to get more value from vendor acts as your general contractor? price — impressions viewed by their their digital budgets as they enhance Or will you outsource the work to your desired audience or within their their publisher and network spend with agency? With each level of control, you desired content. (See “A Step-by-Step even more targeted and price-efficient add fixed costs in hiring experts, but you Breakdown of Real-Time Bidding,” use of funds. This should please the gain transparency and, in many instances, below). The real-time bidding process chief financial officer. To capture the full more efficiency in media pricing. happens billions of times per day across value, however, a thoughtful strategy Mastering the basics of programmatic any number of public and private should precede investment. means that you can tap into its power to exchanges. Public exchanges encom- streamline your ad buy and reduce pass many publishers across the web Things to Consider wasted spend. You can focus your efforts and are open to all advertisers. This Unlike publisher spend, programmatic more and more efficiently on those who would include Google Ad Exchange, media is all about the numbers. There are most likely to be interested in your Yahoo Ad Exchange, and Adap.tv is no homepage takeover to look at or products. That’s the pragmatic power Exchange, for example. In contrast, in a microsite to visit. Brands embracing of programmatic. ■ private exchange a limited number of programmatic should have quantifiable advertisers are included in the auction success metrics, preferably based on Adam Harris is vice president of product and bid for only one publisher. That past experience. What is your historical strategy at Collective. Email him at publisher is either a single brand like average CPM paid by ad format? What is [email protected]. NYTimes.com or an umbrella media company like Time Inc. that encom- passes many different web properties. A Step-by-Step Breakdown of Real-Time Bidding Price, Precision, and Cross-Screen Power 1. You go to an exchange and bid on inventory that is available from publishers. Buying programmatically exponentially 2. All advertisers are bidding at the same time. increases the efficiency of your ad buy. 3. The advertiser willing to pay most for an impression wins that impression. How? Price, precision, and cross-screen power. First, the price of each impres- 4. The winning advertiser typically pays the second-highest price, meaning that sion is driven down by exposure to the if you’re the highest bidder at $100 and the second highest bid was $2.50, open market. You only pay what the you win and only pay $2.50. market is willing to support versus what — A.H. the seller charges. Second, because you can target based on complex audience www.ana.net ANA Magazine Spotlight Issue 8 :: 11 Digital Exclusive Good Fences Make Good Offers Psst, Over Here Geo-fencing, one of the most popular geo-targeting techniques, is a location-based service that uses How Best Buy became a back-to-college destination global positioning systems (GPS) or By Urey Onuoha radio frequency identification (RFI) to define geographical boundaries. When Best Buy wanted to highlight its target audience. Best Buy and PayPal By determining the exact location back-to-college offers, the brand looked applied this technique to both the of consumers when they enter a to PayPal Media Network, a company brand’s stores and those of Best Buy’s geo-fenced area, marketers can send that focuses on leveraging location competitors and were subsequently able targeted and time-sensitive offers. technology and data, to create a nation- to reach nearby consumers in order to Here are six tips on geo-fencing, wide campaign. Using PayPal’s network grab consumers’ attention and usher adapted from PayPal Media Network, to reach an audience of more than 100 them into the product aisles. that marketers should consider: million U.S. consumers, they directly 1.1 When creating a geo-fence, set targeted parents and students. Results perimeters within five minutes Consumers saw this information in of travel time from the target banner ads that were supplemented location to keep local messaging with real-time inventory feeds, selected relevant. based on Best Buy’s specifications, 2.2 Create campaigns first around which showed available products and your primary location, and then pricing for the stores closest to them. target other points of interest Those who clicked on the ads were relevant to your potential automatically directed to a landing page consumers (where the and given the option of making a consumers are). purchase through PayPal Mobile Express Checkout, a service that 3.3 Consumers have to opt-in to simplifies the checkout process for receive alerts, so be transparent mobile consumers. and useful. Working with a $210,000 budget, the The success of the campaign was 4.4 Create brief, location-relevant companies set to work on a 16-week determined by three metrics: Click- messages with a clear campaign that created a unique and through rates were used to measure ad call-to-action. seamless shopping experience through effectiveness, landing page engagement real-time inventory feeds, mobile express measured post-click user experience, 5.5 Use location data and leverage checkout, and geo-fencing to target and sales were measured against other parameters (like a local potential customers. the actual purchases related to the event or the weather) and campaign made using the express features (such as inventory feeds) How It Worked checkout feature. While total sales to increase the relevancy of The use of geo-fencing, a location-based weren’t made available, the campaign messages and enhance targeting. service that allows marketers to target garnered 41 million impressions across 6.6 Determine the metrics you want consumers within virtual barriers around PayPal’s network, with one percent of to use to measure your success a physical space as specific as a store or users who saw the banner ads clicking and track them to ensure you are as broad as a neighborhood, allowed on them and three percent of those getting the desired results. Best Buy to specify and engage with its who clicked making a purchase. ■ — U.O.

12 :: Issue 8 ANA Magazine Spotlight www.ana.net Embrace-Programmatic_Collective_FINAL3_print.pdf 1 7/15/14 4:22 PM

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