Imagine a scenario, where you are scrolling through the Amazon app, hoping you’ll find a good tie to gift your father – Father’s Day just went by, right?
And you see a ‘promoted’ content in the middle of all the product listings – that is a native ad. We have already talked about native advertising in one of our previous articles. Though for the uninitiated, native advertising is a form of advertising where ads acquire the form and function of the ‘native’ they are resting on. You can find more on this here.
Now let us see how this online advertising works.
If someone wants to advertise on the Internet, on some platform, then that ‘someone’ has to buy an advertising space. Think of it as, you want to put your print ad. For that, you’ll probably want to look for spaces and audiences which are most relevant to your business. Right? Now just transition this to digital. Think of it as an auction. When you are buying an online advertising space, you have to look into factors like where to display, whom to display, which advertising platform is relevant to your business and content, while exactly targeting whom to sell your online ad too.
Consider LinkedIn Ads. Now take LinkedIn as a whole pool of people (or a community), or a huge advertising space, with the LinkedIn subscribers being your complete audience. So, you’ll have to buy space for your ad on LinkedIn. You auction for the clicks and impressions and buy your place. Now this buying comes with different objectives, different pricing models, different audiences, ad placements etc. That depends upon the type of ad you want to put across. Check out the picture below.
But what if you can buy your advertising space automatically, via an automated method?
This is what we know as programmatic. It is an automated system of buying advertising space, with the help of different algorithms & through Real Time Bidding (More on this in later articles).
First invented in the year 2007, enhancing your advertising using programmatic gives businesses benefits like accurate ad placement, cost-effective, gives a wide audience reach to your business, allows for a highly advanced targeting. Programmatic advertising gives us a chance to showcase a variety of ad types – native, video, display, mobile). Nearly 80% of online advertisements were programmatic in 2019, which should increase to 87.5% by 2021 (Source: Emarketer).
Now that we know what is a programmatic, combine this with a native ad. Bingo! You have a programmatic native ad.
See how it works. You design a native ad on any platform, say Instagram. The “native” part is done. Now, you have to buy your advertising space on Instagram. For that, you apply “programmatic” techniques – leveraging AI and ML – to get you your required audience and placement. It makes your work easier – by allowing technology to figure out the audience and buying you space, rather than humans doing the work. Done. That’s it!
In the first 2 quarters of 2019, over 6500 companies placed native ads programmatically. Native ads would soon account for 63% of mobile ad revenue by 2020 (Aarki). By 2021, 74% of online ad revenue would be through native ads, and by 2020 almost two-thirds of display ad spend will be native. So, it becomes all the more necessary to improve the mobile ads to programmatic.
Mobile is the new big opportunity for targeted ad placements. Even though the brand content has caught up, brand ads haven’t. Here is where programmatic can play a huge role to bridge the ad experience & the content experience.
Probably the two biggest benefits of this are:
They can help you capture micro – moments, which are small moments which can lead to a purchase (more on micro moments in later articles) and make them big – big enough to fuel a purchase. It opens the gate for contextual advertising (don’t worry, we’ll have a separate article for this). Increased optimization – not making the ads look out-of-place with the platform.
The point is simple. Native ads are important – they receive 52% more attention than banner ads, users are twice likely to click on native ads than normal banner ads, generate 85-93% of more clicks than banner ads, and I can go on & on about the benefits). But what’s more important? Using programmatic to drive your native ad growth.
L’Oreal Canada: By using programmatic buying, they led their prospects to purchase, by gathering audience insights on people who used other products similar to theirs, and achieved a 2200% return on ad spend + increase in web traffic and email subscriptions.
Mondelez International: They saw the power of programmatic in measuring their ad campaigns in Brazil, which led them to increase their brand recall by 97%.
The New York Times: Launched native ad formats called “Flex Frames” – were input programmatically. Resulted in 6X jump in CTR’s & 4X jump in viewable impressions.
Going ahead, we’ll bring you details on Real Time Bidding and how the whole paid advertising works in later articles. Till then, do some research on these topics. Happy Learning!