Marketing, like other core enterprise functions, is being dramatically redefined in the digital era. As empowered consumers–particularly the millennial generation–increasingly demand personalized experiences across various touch points, traditional customer outreach strategies are becoming irrelevant. This explains the growing importance of targeted promotional campaigns to drive higher returns on investment (ROI).
Conventional mechanisms of delivering advertisements on third-party platforms are getting fundamentally transformed, with marketers embracing the concept of programmatic ad buying. Gartner research estimates that more than 40% of marketers at large global organizations will build in-house programmatic advertising capabilities by 2018, up from almost 10% currently.
The growing prominence of real-time bidding
The fragmentation of the media distribution ecosystem, which has gained momentum in the last few years, shows no sign of abating. This structural trend has major implications for marketers, who need to implement dynamic strategies for connecting with their target audiences. Precision has become the operating word, with brands aiming to serve the right impression to the right consumer at the right time.
This imperative has spawned the emergence, and consequent rapid adoption, of real-time bidding (RTB) in recent years. The buying and selling of inventory on a per-impression basis, through instantaneous programmatic auctions, will help brands effectively manage, prioritize, and optimize ads from multiple networks.
By automating the lifecycle management of media inventory through real-time adoption of technology platforms such as ad exchanges and demand-side platforms, real-time bidding fosters addressable advertising. Companies, large and small, can now target existing and prospective customers directly, based on their demographic, psychographic, and behavioral attributes.
Apart from helping companies render personalized, contextualized creative communication, real-time bidding promotes consolidation of user interactions across different devices and distribution channels into a single funnel, thereby enabling an integrated audience engagement strategy.
So, what should you do to make the most of the situation?
To maximize the ROI, digital marketers need to design and implement a consolidated, micro-services based real-time bidding system for managing campaigns centered around diverse objectives including branding, inventory management, and search engine optimization (SEO). A key characteristic of this system should be its compatibility with various engagement channels and types of ad formats.
Any such framework should include three core components. Integration with ad exchange must be set up for buying of inventory from several ad publishing networks simultaneously. This type of marketplace ensures brands have one-stop access to thousands of publishers on demand.
For streamlining the media buying process, a demand-side platform should be incorporated into the real-time bidding architecture. Demand-side platforms provision a single interface for advertisers and agencies to manage and purchase inventory from multiple ad networks, allowing media buyers to aggregate, bid on, and optimize digital inventory across multiple sources. By anchoring the responsibility for receiving requests, calculating the appropriate response, storing the request and response for offline analysis, demand-side platforms enable marketers to deliver contextualized content to targeted users.
Institutionalizing a centralized data management platform, the third component of a robust real-time bidding system, can significantly help advertisers render ads based on granular information such as customer location and browsing behavior. Brands can use data management platforms to consolidate online and offline audience data from various internal and external sources into a single location, and then harness the same for creating demographic and behavioral segments. Moreover, companies can feed back campaign performance data into such an enormous ‘data lake’ to further optimize outreach initiatives, and enhance the quality of associated reporting and analysis. Installation of data management platforms can allow brands to effectively execute targeted online advertising, and track KPIs such as click through rates and cost per click per category.
Overall, the implementation of a forward-looking real-time bidding system can help advertisers generate higher ROI by driving more conversions at lesser costs, automating workflows, and using data for precision and personalized marketing.
Striding to a brighter future
Real-time bidding enables advertisers to accrue multiple benefits. It increases ad efficacy by helping marketers analyze the performance of each campaign through real-time analytics. Secondly, real-time bidding allows companies to fine-tune their ad campaigns on the go, by provisioning instantaneous data around reach, click through rates, (CTR) and audience engagement. Another important benefit is that brands can leverage real-time analytics in conjunction with fraud prevention tools to proactively detect potentially fraudulent inventory, and reduce associated losses.
As shortening the ‘impression to lead’ cycle emerges as a key focus area for brands, real-time bidding is poised to play a crucial role in the digital marketing ecosystem. It is imperative for advertisers to harness the technology for disintermediating the ad value chain, eliminating manual intervention in underlying business processes, and connecting with their target audiences through personalized messaging.