Undoubtedly you have heard of programmatic advertising but you can’t help to ask yourself: How does programmatic advertising work? Let’s start by explaining what it is all about.

The definition of programmatic advertising is using automation in the real-time buying and selling of digital advertisements. It allows companies to dynamically serve ads depending on who is viewing the advertisement.

So, what does the programmatic advertising market look like and is it even relevant?

Zenith Media reports that in 2020, 69% of all digital media advertisements spent will be through programmatic advertising. This amounts to over $100 billion.

This is huge! So how does it work?

Like any business transaction, you will need at least two parties, namely the buyers and the sellers. In this case, buyers are advertisers and sellers are publishers.

Advertisers use a programmatic DSP (Demand Side Platform) to buy digital advertisement spaces. A programmatic DSP allows advertisers to bid on and manage multiple ad exchanges through one platform. All of this in real-time.

Publishers use a programmatic SSP (Supply Side Platform) to manage advertisement inventory, sell, and collect revenue from it. It’s used to automate the placement and selling of advertisement spaces in real-time. It communicates with an ad exchange which in turn communicates with a DSP.

Programmatic Advertising Online Ecosystem

As you can imagine, there is a lot of automation and optimization involved. The goal for advertisers is to be able to serve the right ads to the right audience. The goal for publishers is to make as much money as possible. All of this, as fast as possible.

Whenever you visit a webpage, the publisher will send data to an SSP. Consequently, the SSP will forward the data to an ad exchange. This data is then picked up by a DSP. The advertisement space is now up for sale and advertisers can start bidding on this advertisement space. The advertiser that bids the highest for the advertisement space will win. As a consequence, the webpage will display the advertisement of the highest bidder.

That sounds like a very long process, right? Well, as a matter of fact, this all happens within seconds while the webpage is loading.

What are the benefits of Programmatic Advertising?

In your B2B marketing career, you should understand the benefits of programmatic advertising. It should be integrated into most of your campaigns.

Naturally, there are plenty of benefits to programmatic advertising; both in the business-to-consumer (B2C) market and in the business-to-business (B2B) market.

You only need to manage one platform

Advertisers can manage all of their digital advertisements through one platform. You no longer need to go to various platforms such as Google, LinkedIn, and Facebook to manage your ads. This is a huge resource saver in your company.

Contextual Advertisements

One of the core benefits of programmatic advertising is the ability to place contextual advertisements. Contextual advertisements are ads that are based on the context of the webpage. Let’s say you are reading a post about dogs; advertisers are now able to show ads related to dogs. E.g. dog food.

Cost and time savings

Through programmatic targeting, advertisers now have the ability to place highly relevant advertisements in front of website visitors. Since the ads are relevant to the person viewing it, the cost of acquisition will be reduced. It’s likely that your cost-of lead will increase as highly targeted advertisements are often more expensive. However, since your sales team is following up on more qualified leads, the cost-of-acquisition will be reduced.

Programmatic advertising will eliminate the need for manual negotiations with publishers, setting up campaigns, and maintaining contact with a bunch of different publishers. The technology will do most of the work through machine learning and automation.

Through real-time bidding, the technology is able to bid on advertisement spaces in real-time. This will adjust bids based on real-time demand and supply.

Extra resource: Reduce your google advertising cost by following these steps.

Real-time optimization

Advertisers benefit from real-time optimization through their Demand Side Platform. Traditionally, advertisers would have to analyze their campaigns manually and optimize ads. This data would not be available in real-time.

With programmatic advertising, the platforms benefit from real-time data. Conversion rates are checked and optimizations are put into place immediately. Variations of your ads can be served and text can be adjusted dynamically. This prevents you from serving ads for an extended time that are not performing well.

Why does programmatic advertising work in B2B Marketing?

We now understand the benefits of programmatic advertising, but does it even work in B2B marketing?

The short answer is: yes, it works!

The long answer is a bit more complicated. However, you can’t miss out on this.

Each programmatic DSP has a network of ad exchanges. These ad exchanges communicate with certain programmatic SSPs and therefore publishers.

Let’s say you work for a technology company that sells low-code software and your target audience is Chief Information Officers (CIO). Your ideal target audience for this niche is not likely to visit certain publishers; such as publishers that write content about graphic design.

You need to identify which DSP has access to a network of publishers that your target audience (CIO) is likely to visit. In short, you need to select the right DSP for your niche.

When you’ve selected the right DSP, the most significant reason why programmatic advertising works in B2B marketing is the targeting abilities as well as time and cost savings.

Integrations with marketing systems and CRMs

There are tools available on the market that let you integrate your marketing systems such as Marketo, Hubspot, and Salesforce with a DSP. Now, this is huge!

This allows you to automatically show ads to people based on their behavior in your marketing system.

Let’s say a lead showed no engagement but through your marketing efforts, you converted this lead into a Marketing Qualified Lead. This means this lead is now further down in your marketing funnel. You can now automatically show a different set of advertisements to this person.

Another example: let’s say someone downloaded a whitepaper from your website or engaged with a content syndication campaign. You can now automatically show ads to this person and try to get this person to download the next whitepaper according to your marketing nurture.

Programmatic targeting in B2B Marketing

Through programmatic targeting, you are able to serve very specific advertisements in front of your target audience. We’ve already discussed contextual targeting, which is placing ads based on the content of the webpage.

However, this is not your only targeting option. There is much more and that’s where the true value comes into play!

Keyword-based targeting allows advertisers to show advertisements based on the keywords supplied. Let’s say you have a very specific keyword such as “low-code platform costs”. This might be a buying-intend for your company and you might be willing to spend more budget on this keyword.

Data-based targeting allows advertisers to show advertisements based on user data. Advertisers will get the most out of their programmatic advertising campaigns when they integrate a DSP and a Data Management Platform (DMP). A data management platform is like a file cabinet that stores information about users.

An example is to show ads that have visited at least 5 pages about a certain topic. The buying-intend will be higher and your conversion rate will improve.

Location-based targeting is well known and places ads in front of people based on their location. This could work well if your B2B area of focus is in a certain country. However, it’s also interesting when you want to penetrate new markets and allocate more budget to certain countries.

Retargeting is placing advertisements in front of people who have already engaged in your marketing campaigns or website.

Programmatic Advertising and your target account list

Many B2B companies have a named account a.k.a. target account strategy. Basically, this means that your sales organization has a list of accounts that they want to sell to.

Programmatic advertising and account-based marketing go hand-in-hand. This is more commonly referred to as account-based advertising.

Earlier in this article, I mentioned that programmatic advertising can be integrated with your marketing systems such as Marketo and Salesforce. This is the key ingredient to making account-based advertising work.

This enables you to show specific advertisements to account depending on where they are in your sales cycles!

Let’s make this more tangible and use Walmart as an example.

Imagine Walmart is a target account of your company. Currently, Walmart has shown no engagement with your marketing efforts and there is no opportunity created in your CRM at the moment.

At this stage, you will want to drive awareness in Walmart. You might show advertisements that make it very easy for Walmart employees to convert on your website; such as filling in a form.

Let’s say you’ve generated some leads from Walmart, and your sales team had some conversations with them. Consequently, an opportunity has been created in your CRM.

Walmart is now early in a sales cycle and you will now show different advertisements to Walmart, such as case studies.

The sales opportunity has now progressed to 75% and is late in the sales cycle. At this stage, you might want to show advertisements about analyst reports and ROI calculation reports.

All of this, automated!

As you can imagine, this is a very powerful account-based advertising strategy and will lead to success. The fact that this all can be done through automation will save a lot of internal resources.

