Programmatic Advertising: the Next Level of Personalization During the Pandemic

Although the global health crisis is paralyzing for many industries, such as travel, some sectors are experiencing a rapid increase in demand. And the quick rise of these industries translates to a growing investment in digital advertising.
8/07/20
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By Max Kalmykov
Vice President, Media & Entertainment
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Programmatic Advertising: the Next Level of Personalization During the Pandemic

If we want to avoid a race to the bottom, it’s key that technology and creativity are better aligned. To realize the potential of the programmatic infrastructure, we need to ensure there’s a high-quality content stack in place – and that can be challenging with the dizzying array of formats and platforms to choose from.

Sarah Wood co-CEO and co-founder of Unruly

This is a preview of a larger article. Below, you can download the full version for free.

Programmatic advertising is booming, even amidst the COVID-19 pandemic.

According to a study conducted by eMarketer, 84.9% of the US digital display ad market was spent on programmatic ads in 2019. And this number is predicted to rise to an incredible 88% by 2021 to reach a staggering $81 billion in the US alone.

The potential for taking personalization to a new level is one of the many exciting components of programmatic advertising. The modern consumer expects a customized experience throughout virtually every aspect of their day, leading marketers to increase their focus on personalization and discovery in ad campaigns. The possibilities for creating deep connections between brands and consumers continue to inspire marketers, while technological innovations further the ability to bring these concepts to fruition through automation and customization. It is, therefore, not surprising that programmatic advertising is on the rise as the related technology advances while the consumer climate evolves.

Pandemic Impacts Ad Spend

As the power and prevalence of artificial intelligence and other sophisticated tools increase exponentially, automation in advertising is rapidly becoming the norm. The current market is dominated by Facebook and Google, with eMarketer predicting that this duopoly will account for more than 50% of the total programmatic display spend this year.

Several programmatic platforms are on the rise during the COVID-19 pandemic. Connected TV, streaming, communication (Messenger, web conferencing, etc.), digital audio, and podcasts are experiencing a significant spike in traffic, making them particularly desirable to advertisers. As consumers spend more time on these platforms, advertisers can take advantage of the opportunity for increased impressions and engagements derived from their marketing campaigns.

Contextual and Native Ads

A recent wave of data privacy legislation — such as GDPR and CCPA—is bringing contextual and native advertising to the forefront. These formats allow brands to develop personalized ad campaigns without relying on customer data or cookies. By utilizing programmatic tools to display ads that relate to the content a consumer is viewing, marketers can maximize the value of their ad spend.

Although there is a strong shift toward data protection, today’s consumers still expect a highly personalized experience. Contextual advertising offers an ideal solution by meeting people’s expectations to see ads that are closely aligned with their interests in addition to offers that appear to be designed particularly for them.

Audio Ads

The remarkable growth of music streaming platforms makes programmatic audio advertising increasingly attractive to brands. The interest in automated audio ads also goes beyond music streaming to include inserting advertisements in podcasts and digital radio as these formats rise in popularity.

One of the many powerful opportunities that exist in programmatic audio ads is the fact that most people listen to them via headphones. There is a certain type of connection between a brand and a listener that can take hold through the closeness of headphone listening, allowing marketers to focus on delivering a personalized message in a special way.

Connected TV Ads

Smart TVs are steadily gaining ground across the United States. According to a recent report from Leichtman Research, 32% of all televisions in U.S. households are connected smart TVs. And in a survey of 1150 U.S. TV homes, it was discovered that 31% of adults consume video daily on a connected TV, while more than half watch video on a connected TV at least once per week.

The popularity of video streaming is rapidly expanding, as platforms such as Netflix, Hulu, Amazon Prime, and Disney Plus continue to increase their subscription bases. Connected TV (CTV) ads carry the potential for a high level of personalization and fine-tuned targeting capabilities for marketers to utilize. Since ad blockers for TVs are not available, viewers cannot opt-out from seeing advertising content, which is a powerful enticement for companies to increase their CTV ad spend.

This is a challenging time for us all, but the coronavirus crisis will eventually end, and the strength of our economy will return. As programmatic advertising takes hold in the industry, it becomes vitally important to remind ourselves of a key fact: while automation, AI, and other technological tools gain increasing importance, innovative concepts and a strong creative spirit continue to be essential ingredients in the development of a robust marketing campaign. Moving forward, I believe it will be the companies that successfully combine advanced technology with highly memorable messages that will rise to the top in the evolving digital advertising landscape.

This was a preview of a paper by Max Kalmykov. You can download the full version for free below.

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