How programmatic advertising is about to change your business
22 November 2016
The advertising industry is entering a new era of accountability. The winners in this new age will be the brands and agencies that marry data, technology and creativity to make a personal and lasting connection with their relevant audiences.
In 1923, Claude Hopkins published his bestseller Scientific Advertising. In it, he described how to track, attribute and optimise advertising in order to achieve the best possible returns.
“In the old days,” said Hopkins, “advertisers ventured on their own opinions. The few guessed right, the many wrong. Those were the times of advertising disaster.”
He was speaking in the past tense. In 1923. Yet here we are, almost a century on, and many people in the industry would — if you pressed them — admit that a lot of media plans are still built on more or less educated guesswork or to suit the preferences of the highest paid person in the room. Why?
There could be many reasons: maybe the decision maker still does not have access to the relevant data he or she needs to be scientific: accurate tracking is often thought to be too difficult in a multi-channel, multi-device environment… or maybe someone high up has bought into one particular way of doing things years ago and cannot be convinced to try something else (i.e. “let’s just stick with TV please…”)
So how can we overcome these obstacles to work out which combination of mediums, audiences and creative are working best to achieve advertising objectives? How can we know, in real time, how to best allocate our marketing budget in order to get the highest possible returns? By using tools for targeting, measuring and attribution that Hopkins could only have dreamed of, that’s how.
How to engage consumers in an attention economy
So, what’s happening in your world? […] Stop! You took too long to answer and now you’re boring me.
Frustrating? Get used to it. According to research by Microsoft, the average consumer has an attention span of just eight seconds. What’s more, when you lose them, they won’t just have opened another browser window — there’s a good chance they’ll have picked up another device entirely.
And that’s hardly surprising. Consumers are bombarded with thousands of advertising messages every day — most either not relevant to them at all or sometimes just not relevant in that particular moment. And this is happening exactly as our collective expectations — in terms of relevancy, immediacy and personalisation — are higher than ever, especially with the likes of Amazon Prime, Uber, Netflix and other digital disruptors that have enhanced and brought value to our digital experiences.
As if that wasn’t tough enough, a recent study by Adobe Digital Insights found that about 20 per cent of European consumers use ad-blocking technology.
Advertisers find themselves trying to get the attention of consumers who have never been more bombarded, bored or cynical. And the only way to cut through that, is by making advertising personal and relevant, getting it to speak to peoples’ aspirations, preferences and needs in each moment.
Nicolas Bidon, EMEA CEO at programmatic audience company Xaxis, says: “At the top level, the biggest challenge for the industry is how to harness the power of digital to reach and engage with our audiences at scale.”
Escaping the media silos
Using the full potential of digital to increase engagement isn’t straightforward. Media usage is increasingly siloed — with users dividing their time between different devices and an ever growing range of media.
A study by Adobe found nearly 80 per cent of all consumers — and 90 per cent of millennials — reported sometimes switching devices mid-activity. How, then, are advertisers to take the information from all these different devices and channels and match it all up to build a unified picture of the preferences and behaviours of a given consumer? “Given the fragmentation of how, when and where users are consuming media, it is becoming more of a challenge for marketers to report back on their return on investment,” Bidon says. “Advertisers are feeling the pain.”
To help solve these problems, advertisers are turning to programmatic advertising or automated trading technology that uses a vast amount of data to understand individual consumer behaviours, so marketers can easily join the dots and engage with the audiences they are after with ads that are relevant to them.
Data is the key to a more welcomed and engaging customer experience
Modern programmatic platforms are extremely sophisticated. In many cases, it’s already possible to anonymously identify and track consumers as they move from an app, to a mobile browser, to another device, to a bricks-and-mortar store. Assuming they have permission, advertisers can target audiences based on their location, their preferences and a range of other sophisticated buying triggers.
“Programmatic technology gives you the ability to connect the dots across the fragmented media landscape,” says Xaxis CEO Nicolas Bidon. “This enables advertisers to paint a clear picture of the consumer path.” It allows brands to craft messaging that is uniquely relevant to the person viewing it and therefore giving them an incentive to turn their ad blocker off and to give the message their full attention. For example, if you want to promote Visit Britain and you know that the person you are serving an ad to on the Guardian is a nature lover, you can automatically display an ad featuring shots of windswept Cumbria rather than London nightlife. And this happens in real time.
Countless case studies have shown that when advertising content is informative, engaging, entertaining and relevant to a specific audience, it helps brands greatly increase conversion rates.
From online to offline and back again
Another challenge digital advertisers are facing is the fact that most day-to-day transactions are still happening in stores. “It’s tricky,” says Bidon. “Even though e-commerce has had an amazing journey to date, most of the day-to-day transactions still happen in stores.”
To help measure the effectiveness of digital advertising on offline sales, retailers are increasingly experimenting with new technology like in-store beacons or in-store redemption of mobile coupons. “These mobile devices are amazing,” says Bidon.
“They know a lot about us and our media consumption. But they also know where we go, so that is one way in which you can try to close the loop and see if the digital span is actually bringing footfall to your store.”
The future of advertising
In the first episode of Mad Men, Don Draper tries to sell a coupon campaign to Rachel Menken, proprietor of a New York department store. Menken, however, has other ideas. She doesn’t want a hum-drum coupon campaign that will bring in housewives. She wants to build a brand and attract affluent big spenders. With the tools programmatic, omni-channel advertising puts at your disposal, you could help Menken do both — in a way that would win the business from under Draper’s nose.
The future of advertising is a marriage of creativity and science that Claude Hopkins would thoroughly have approved of. It’s going to help us get closer to the marketing nirvana of delivering the right ads for the right consumers, and put them in the right place at exactly the right time. That’s how we’ll make advertising great again. And it’s going to make our clients — the forward-thinking ones who are ready to embrace technology, experiment and learn — a lot of money in the process.
Now that’s what I call a win-win!
To find out more about the programmatic audience company click here: www.xaxis.com