Challenges of Programmatic Advertising and How to Navigate Them
Programmatic advertising has upended how companies get their message before an audience. By integrating semi-automated procedures to purchase and sell ad slots, advertisers can enhance their ad spend, target precise target markets, and get verifiable results. However, such a powerful means of advertising is also the source of a number of problems.
Understanding Programmatic Advertising
Before starting with the challenges, let’s first clearly understand what programmatic advertising is. In short, it is using automated technology, such as AI, to handle the purchase, placement, and optimization of digital ad inventory. In this process, algorithms and findings from data are combined for precise targeting of audiences.
But things are not always so smooth, of course. Transparency issues on cost and delivery, as well as advertising fraud, are still there for advertisers. That said, if we don’t get it right from the start, none of it will work.
So now let’s take apart these three points and find a way forward on each one.
The Main Challenges of Programmatic Advertising
Lack of Transparency
Transparency is often one of the biggest concerns in programmatic advertising. Advertisers sometimes don’t have a clear view of how their budget is being spent or whether their ads are being shown to the right people in the intended context.
Solution
- Work with trusted Demand-Side Platforms (DSPs): Not all DSPs are created equal. Choose platforms that provide detailed reporting and openness about ad placements and costs.
- Request transparent metrics: Ask your ad tech providers for traceability by requesting clear insights into where your ads are displayed and the performance data.
- Partner with an ad verification vendor: Companies like IAS (Integral Ad Science) or DoubleVerify can give you added reassurance on ad placement and visibility.
Brand Safety Concerns
Seeing your brand’s ad next to inappropriate or harmful content is every marketer’s nightmare. This is a risky aspect of programmatic advertising, especially as ad placements can happen across a wide range of websites.
Solution
- Use brand safety tools: Many DSPs offer built-in brand safety settings and filters. Enable these features to avoid harmful content categories.
- Employ blacklists and whitelists: Blacklists prevent your ads from appearing on specific websites, while whitelists ensure they are only displayed on pre-approved, trusted sites.
- Invest in contextual targeting: Contextual targeting focuses on matching your ad’s message with content that’s relevant and appropriate for your brand.
Ad Fraud
Ad fraud, where fraudulent actors generate fake impressions or clicks to deplete advertisers’ budgets, is a growing issue in the programmatic space. According to recent estimates, ad fraud costs businesses billions of dollars annually.
Solution
- Adopt fraud detection tools: Tools like White Ops and MOAT detect and block suspicious activity within your ad campaigns.
- Monitor metrics: Be wary of metrics that seem too good to be true, such as extremely high click-through rates (CTR) or unusual traffic spikes from certain sources.
- Partner with verified vendors: Ensure that your DSP is working with SSPs (Supply-Side Platforms) and publishers that are audited and certified by industry bodies like TAG (Trustworthy Accountability Group).
Data Quality and Accuracy
Programmatic advertising heavily relies on data to deliver targeted campaigns. However, inconsistent, outdated, or inaccurate data can undermine audience targeting efforts and lead to wasted ad spend.
Solution
- Invest in first-party data: First-party data, collected directly from your customers, is often the most reliable and accurate.
- Double-check third-party data sources: Audit your third-party data providers to ensure the information they offer is complete and up to date.
- Leverage data management platforms (DMPs): A DMP can help you organize and activate data more effectively, improving the accuracy of your programmatic campaigns.
Technical Complexity
For businesses new to programmatic advertising, the technology and jargon can feel overwhelming. Navigating multiple platforms, managing ad creatives, and analyzing performance data require expertise and time.
Solution
- Hire or train in-house talent: Equip your team with programmatic advertising skills or hire professionals experienced in managing programmatic campaigns.
- Work with agencies: If managing programmatic in-house isn’t feasible, partner with a reputable agency specializing in digital advertising.
- Simplify platforms: Focus on user-friendly DSPs and tools that offer tutorials, pre-configured settings, and customer support.
Difficulty Measuring ROI
Another challenge is accurately measuring the impact of programmatic ads. Metrics like impressions and clicks don’t always directly translate into conversions, leading advertisers to struggle with assessing the true ROI of their campaigns.
Solution
- Define clear KPIs: Establish which metrics matter most to your specific goals, such as conversions, sign-ups, or sales.
- Track cross-channel performance: Use attribution models to measure how programmatic campaigns fit into the larger customer journey.
- Utilize advanced analytics tools: Platforms like Google Analytics 360 or Adobe Analytics can help you gain a deeper understanding of campaign performance across multiple touchpoints.
Overcoming Programmatic Challenges and Driving Success
Programmatic advertising brings us a number of problems, but only a few are truly insurmountable. With all of the above implemented, a brand may like its brand name to be less hit, and the effect is seen in this article.
But don’t stop there. Programmatic advertising is constantly evolving, and to stay ahead is to keep up with industry developments, evaluate new tools and platforms, and continually hone your approach to campaign management.
If you are committed to taking your advertising to the next level and making better, data-informed decisions, then investing in tools and partnerships that offer insight, security, and accuracy will empower your competitive advantage.
