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The Myths Behind Programmatic Advertising

Updated: Jul 12, 2022

It's no secret that our experts at 7Social are in love with programmatic advertising. So we want to bust some nasty rumors you may have heard about it but first, what is programmatic advertising?

Programmatic advertising is the practice of automatically purchasing and selling digital advertising space using a series of algorithms. Prior to programmatic advertising, ad ordering, setup, and reporting were all performed manually. Programmatic advertising streamlines the process, making it more successful and efficient. Thanks to programmatic platforms that have established their ad inventories and databases, all channels and formats may be accessed automatically.

With that out of the way, let's explore five of the most common misconceptions about programmatic advertising to determine their reality in light of how far we've come since its invention.

Programmatic Advertising is a Passing Fad

There are those who say that programmatic advertising is just a fad but it in fact has existed for 15 years and continues to evolve and grow in popularity as time goes by. In 2019, advertisers allocated 85 percent of their budgets to this platform. It is expected that programmatic transactions will account for over 90% of all digital display ad spending by the end of 2022. This is a pattern that is expected to continue for the foreseeable future.

Programmatic Advertising Lacks Flair and Creativity

Some people have come to feel that creativity and size are mutually incompatible in the digital world as a result of the static, uninspiring displays often seen in the industry. This is not necessarily the case with programmatic advertising.

The truth is that many businesses have adopted data-driven, rich media formats that are creating immersive, multipurpose content. Shoppable ad units, for example, are gaining popularity because they allow marketers to engage audiences at any stage of the purchasing cycle and convert them with a single ad.

At 7Social, all of our programmatic display advertising packages include custom Ad Copy & Creatives. This means instead of bland and boring ads that viewers scroll right past; we can tailor the programmatic advertising to fit your specific brand and voice. With our team of experts at the helm, you can rest at ease knowing that space will be purchased quickly for beautifully crafted advertisements.

Programmatic Inventory is of Inferior Quality

There has been speculation that in addition to lacking creativity, the ads purchased through programmatic advertising are of an inferior quality. The belief among some is that the ad space purchased will be for rarely viewed websites, with little to do with the ad's target audience. Earlier on, it is true that many publishers were testing the waters and hence only released their so-called remainder inventory. However, they no longer relegate the least valuable spaces for ad purchasing, leaving marketers with ad spaces with low consumer traffic.

In reality, programmatic advertising precludes programmatic direct and private exchanges where any types of inventory, including "premium" placements that were formerly held privately and through PMP, may be acquired programmatically (private marketplace or also known as preferred deals). This means that premium spaces are always up for grabs.

Programmatic is Cheapskate Advertising

In many ways, this myth is similar to the one above! Certainly, there is a distinction between buying cheaply as one might do in the stock market and buying at optimum value. Programmatic facilitates the latter. Rather than buying ads as cheaply as possible, programmatic advertising’s purchasing limits and cost must originate from the practices and choices made by the purchaser themselves.

When it comes to making a purchasing choice, there is a growing focus on what is ideal, i.e., taking into consideration several aspects. On occasion, purchasers may choose to acquire cheap impressions as opposed to valuable, quality impressions. Rather than focusing just on price, the focus is now on achieving the target or goal and afterwards calculating the "right" price, where "right" is decided by the aim.

Paying slightly more to achieve your objective might reduce your CPC/CPA since such a choice would be made millions or billions of times over the life of a programmatic campaign. With the simplicity of system automation enhancing optimization and planning, it is crucial to have the sophistication and flexibility to establish your purchasing needs.

Programmatic Purchasing Lacks Transparency

Due to the manner in which programmatic ads are purchased, many companies fear that they cannot ensure that their agency is targeting consumers with the most appropriate brand message. As a consequence, they are unclear about the efficacy of their online spending.

This amount of unpredictability is the reason why companies continue to be cautious around the idea of programmatic advertisement purchasing.

In previous years advertisers did not have access to the data behind their campaigns, including cost, margins, and where advertisements were appearing, as well as performance improvement initiatives and comprehensive information on how consumers engaged with their brand.

As the programmatic purchasing market grows, however, several media buying companies are building customized programmatic buying solutions to mitigate the risks around inventory, audience, and optimization transparency. Many agencies now also include monthly or quarterly analytics about purchased advertisements. It is essential to check if these solutions are made clear by your chosen facilitator and to what degree.

At 7Social, we take out all the guesswork when it comes to programmatic advertising. With packages starting at $2500 per month, we will onboard your company to our programmatic platform; this includes adding your social pages for data collection. You will have access to the dashboard to view reports. You’ll be able to see everything we are doing to get your ads out into the world! So you will know where your money is truly going.

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