Programmatic Advertising uses artificial intelligence to find the “best match” for publishing display ads. It is a highly efficient and effective form of reaching your target market. Recent advances in programmatic mean that in addition to being a tool for buying a high volume of digital advertising inventory at a lower cost, it also adds value by improving campaign effectiveness and the digital customer experience.
It is fair to say that Google holds all the cards when it comes to online advertising. In fact, close to 90% of every digital ad dollar goes to either Google or Facebook, the two giants of our information age. So, what could possibly convince international brands like Verizon, AT&T, Honda, and Volkswagen to turn their backs on the world’s biggest search engine?
All of these companies recently boycotted Google, despite relying heavily on its video and display advertising network. AT&T, for example, spent a whopping $941 million in 2016. Yet, something triggered a dramatic turnaround. Unsurprisingly, it’s a problem which Google is keen to solve before the embargo really starts to hit its profit margins.
The system which is causing havoc at Google is called programmatic advertising. As it now accounts for 80% of the display advertising part of the market, it is extremely influential. It is a developing, evolving way to bid for digital ad space. The aim, as with most new technologies, is to take a familiar process and supercharge it.
Instead of manually searching for and booking ad slots, programmatic tools enable businesses to use a kind of online marketplace. So, rather than phoning a company like YouTube or Facebook and negotiating for promotional space, brands can now pay Google to do it for them. They choose the type of person they want to reach, and Google matches them with free slots.
The big problem is that the audience data is seriously limited. Traditionally, marketers would know, specifically, where their ads were being placed and seen. With programmatic marketing, there’s lots of demographic information (age, gender, etc.), but there’s no immediate way to tell what kind of websites a particular audience is visiting.
So, there’s no way to know for sure if this ‘ideal’ audience is viewing the kind of content which aligns with the target brand. Unfortunately, this has led to some high-profile catastrophes for Google. For a time, advertisements from brands like the BBC and Channel 4 ended up being added to extremist, terrorist, and violent videos. Hence, the very earnest boycott.
In truth, the problem is not with the system itself but with the way in which it is being operated. Clearly, more sophisticated indexing tools need to be implemented to weed out inappropriate content. This is something which Google is working very hard to achieve. As it is responsible for much of the infrastructure which delivers digital advertising, the pressure is mounting.
At the annual Google Marketing Next conference, the company discussed plans to improve its ad placement algorithms and focus more keenly on consumer patterns. It will broaden In-Market Audiences tools to include Search and Shopping. This allows for the use of intent signals (such as browsing patterns) and search queries to categorize digital consumers.
Plus, the familiar Adwords system is changing too. By the end of 2017, it will be available to all advertisers. The aim is to help businesses streamline the management of their campaigns and make sure that content is reaching the right people. With the Optimise and AdWords integration, users will be able to launch tests of campaigns, keywords, and ad groups.
It is clear that there’s no simple answer to the weaknesses demonstrated by Programmatic Advertising, though it is a very powerful tool. If Google can get it right, it has the potential to change marketing forever – again. However, the search giant has to take a little more responsibility for its failings before it can learn from them.
Or, at least, that seems to be the general consensus among the boycotting brands, several of whom withdrew their support even after Google announced plans to improve. Many recognize the power that the search engine holds. The reality is that it could and will survive a boycott because it controls such a huge percentage of the market. However, if digital marketing is to have a bright and innovative future, it needs to work closely with brands to ensure that their actions are aligned with the needs of consumers.