undercover.co.id – PROGRAMMATIC ADS , Adjusting the Budget , Advertising often has to hit several obstacles. One of them is cost. Programmatic advertising is able to provide an alternative to remain effective to the target market at an adjustable cost.
Developing effective advertising requires knowledge of the market you want to target. The choice of advertising channel itself must be right to be effective, while minimising the budget. Quite often, budget efficiency becomes one of the benchmarks of a successful advertising strategy. The reason is that not all companies have the budget to burn advertising money.
Programmatic advertising is often cited as a way out for advertisers to adjust their budgets to the advertising channels needed. In addition, this advertising method provides data that can be tracked back to its effectiveness. By definition, the programmatic advertising method is any form of advertising that can intelligently manage who will see the ad and the system chooses to empower this ad to whom and can manage in real-time.
This method gives advertisers the freedom to choose channels that have the most positive impact. The way it works is simple, such as when a user does research to buy a smartphone either from a smartphone or a computer, then the adverts in the application used by the user will appear ads about smartphones. This method also has a retargeting function, such as when a user watches a video review about a smartphone, the advert will pop up recommendations about the smartphone.
Programmatic advertising relies on algorithms from searches made by users. This algorithm reads the search data performed by the user, and the data obtained comes from the application used by the user. Usually, each application will confirm whether or not the user agrees to its usage data being provided to advertisers so that advertisers are more effective in providing useful advertising recommendations for users.
As the use of smartphones increases, and people’s habits start to go digital, the development of this advertising method is also growing. Technavio’s report titled Global Programmatic Advertising Spending Market 2022-2026 shows that this advertising method is growing positively. This projection is expected to continue until 2026.
Technavio said this advertising method experienced a growth of 15.78% in 2022 globally. In terms of global growth value alone, until 2026, the value will increase by US$ 314.27 billion. From year to year, the projected annual growth rate (CAGR / Compound Annual Growth Rate) reaches 26.66%. While the largest contributor still comes from the North American region with a contribution of 34%.
The globally recognised popularity and effectiveness of this advertising method provides a long way for this method to keep growing. In addition to its popularity and effectiveness, this method provides another option for advertisers. A survey conducted by Google and Forrester in August 2021 showed that there are several options that make up the big landscape of how brands use programmatic advertising methods.
The survey, which was conducted among 1,065 directors and above in the field of global advertising strategy, concluded that there are several uses that brands make of this advertising method. In the list, the top three are Testing and experimentations, brand suitability controls, and audience development. Testing the effectiveness of advertisements is still the main purpose of using this method with a percentage of 30%, while content suitability with brand identity is at 29%, and audience development at 28%.
Meanwhile, other utilisations include Ad personalisation, Ad remarketing, Campaign Optimisation, and Inventory management. These utilisations received the same percentage of 27%. From ad personalisation, to how brands manage their storage to be more effective, by anticipating which products sell the fastest, are the reasons brands use these advertising methods.
In Indonesia, this method is already commonly used by brands. Data reading using algorithms is the reason why programmatic advertising is right on target. This is the reason why PT Bank Central Asia (BCA) uses this method.
“Programmatic advertising is one of the channels to expand the reach of the information we are trying to convey in a measurable way. This can be optimised to increase engagement with our customers,” said Norisa Saifuddin, Senior Vice President of Marketing Communication at BCA.
Besides BCA, another brand that also uses this advertising method is Huawei Device Indonesia. Huawei’s operating unit in Indonesia sees that programmatic advertising has more impact to provide consumers with knowledge about the company’s products. Huawei measures the effectiveness of this advertising method by how much consumers know about the company’s products.
“When it comes to engagement, our goal in advertising is to get people to buy our products or at least search for our products on Google to find out more. Programmatic advertising makes it easier for us in terms of retargeting,” said Frendy, Marketing Campaign Manager at Huawei Device Indonesia.
Both brands admit that the use of programmatic advertising is neither more expensive nor cheaper. Because in its application, BCA is still continuing to optimise. Similarly, Huawei considers programmatic advertising to have advantages in the adjustment of advertising costs.
“The price is free for us to adjust. So we are also free to control the situation and time. So, the most cost efficient is actually programmatic advertising because of that freedom. Sometimes the budget size is not enough to advertise on TV or not enough to advertise through KOL. Flexibility is the main point,” said Frendy.
Both agree that such an advertising model can reduce costs. However, in terms of customer acquisition, they have slightly different views. Frendy agrees that the results and application of programmatic advertising can be different in each industry, depending on how the marketing strategy in each company is carried out. Meanwhile, Norisa sees that it is quite difficult to see that customer acquisition occurs due to programmatic advertising alone. The company’s advertising strategy needs to combine various media to balance the upper funnel, mid funnel, and lower funnel.
“When it comes to reach numbers, programmatic does provide results in terms of exposure numbers that are quite good. However, it cannot stand alone and must still be combined with other media. In the future, we are exploring how programmatic advertising can help to consider until finally convert,” said Norisa.
For Huawei, the implementation of programmatic advertising makes it easier for the company to make acquisitions. The company itself uses social media channels Facebook and Instagram, coupled with YouTube in its programmatic advertising strategy. The company places videos and images about the company’s products on these channels. Then, using the retargeting feature, adverts about the company’s products will target those who have watched videos and images about Huawei products.
“We can retarget people who have watched our videos. If we retarget people who have watched our videos, the likelihood of them buying will be higher than retargeting people who have seen our adverts in the form of images only. Because, if they have watched the video, potential customers already know the features of the item. They just need to be reminded that the item they have seen is still in stock,” said Frendy.
The implementation of programmatic advertising gives brands the flexibility to adjust their budget for advertising. However, it should be underlined that implementation and results can vary. What about your brand?