Changes in technology over the years have enabled firms and small businesses to find ways to reach out to the target customers. Advertisements are often general hence are irrelevant to some consumers especially those who are not interested in the products being advertised. Researchers indicate that only twenty percent of internet users perceive online adverts being relevant to their needs and interests (Busch, 6). However, programmatic advertising has changed the face of online advertising to enable sellers to to sell their products directly to their target customers. The paper will focus on the description, advantages, disadvantages, and implications of programmatic advertising on organizations.
Programmatic advertising is a marketing strategy that targets the specific audience a seller intends to, based on the gender, age, financial status among other demographics (Noller and Magalon, 115). It involves the purchase and sale of marketing space in real time through automation of the placement, buying and optimization of media information through a bidding system (McConnell and Hoecker, 270). Unlike the traditional forms of advertising which acquire advertising space through quotes, human negotiation and proposals, programmatic advertising uses algorithms and machines to purchase the space. The programmatic advertising platforms acquire data from millions of online customers through an analytic software that searches and classifies the information of the shoppers using their needs. Firms, therefore, manage to pay for ads that are delivered to the right people and at the right time.
There are various benefits that programmatic advertising offers to its users. It enables firms to showcase their products to their desired customers at the time the customers need them because it employs real-time data and insights to the consumers (Noller and Magalon, 117). It relies on the recent search history of a consumer hence posts data on similar products to what the consumer is looking for as ways of promoting the products from sellers retailing them. It is important for advertisers because it enables to reduce the possibility of purchasing the wrong traffic hence wasting their money (Seitz and Zorn, 40). Programmatic advertising is also flexible to market changes as it offers advertisers information on clicks, conversions and traffic ratios that enable marketers to spend their time on actual strategies of creating effective adverts rather than using it on forming tactics to reach the consumers (Brosche and Kumar, 223). It also lowers the cost as well as increase the speed of advertising. It minimizes the need for manual request for space hence lowers the number of workers that would undertake the manual tasks in the traditional advertising practices thus minimizing costs for advertisers. On the other hand, it enables consumers to view the adverts whenever they are searching for similar products online and also appear within milliseconds hence enabling the target consumer to view the adverts quickly hence making it efficient. Additionally, it can responses on adverts in real time hence enable advertisers to change them if the consumers seem uninterested in the adverts offered.
Programmatic advertising also has its disadvantages. It makes advertisers lose their accountability to the expenditure because they fail to verify if their adverts are being shown to the target consumers. Therefore, the advertisers face a transparency issue as they cannot verify the consumers who see the adverts (Seitz and Zorn, 45). It also attracts a high number of ghost sites which record traffic however some are due to paid clicks which means that they are not genuine hence the information does not reach the target consumers as intended by the sellers (McConnell and Hoecker, 272). On the other hand, it is a form of laser targeting which guarantees the advertiser that his or her information will reach the right consumers. Therefore, the adverts' publishers charge the advertisers more because they are assured of positive response from the target consumers.
Brosche, Kolja, and Arun Kumar. "Realtime Data Accelerates Online Marketing." Programmatic Advertising. Springer, Cham, 2016. 221-232.
Busch, Oliver. "The programmatic advertising principle." Programmatic Advertising. Springer, Cham, 2016. 3-15.
McConnell, Ted, and Lothar Hoecker. "Managing to Quality Attention and Outcome Through Programmatic Technology." Programmatic Advertising. Springer, Cham, 2016. 265-277.
Noller, Stephan, and Fabien Magalon. "Programmatic Brand Advertising." Programmatic Advertising. Springer, Cham, 2016. 111-122.
Seitz, Jurgen, and Steffen Zorn. "Perspectives of programmatic advertising." Programmatic Advertising. Springer, Cham, 2016. 37-51.
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