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What Is Programmatic Advertising? How Does It Work?

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What Is Programmatic Advertising? How Does It Work?

Programmatic advertising has been a buzzword in the marketing industry for quite some time. But what does programmatic actually do? And how does it differ from traditional display marketing?

Read on to learn everything you need to know to be successful at programmatic advertising.

What Is Programmatic Advertising?

Programmatic advertising uses automated technology and algorithmic tools for media buying. The term programmatic relates to the process of how ads are bought and sold in the advertising space.

Programmatic advertising differs from more traditional media buying methods in its use of automation.

It analyzes many user signals to ensure that ads serve the right person, in the right place, at the right time.

Think of programmatic as the umbrella in this category, where different types of programmatic buying are categorized beneath it.

What’s The Difference Between Programmatic And Display Ads?

It’s easy to confuse display and programmatic ads, especially with the strides that Google has made in its automated and real-time bidding capabilities.

The largest difference between programmatic and display is:

  • Programmatic refers to how ads are bought.
  • Display refers to the format of how ads appear.

The second biggest difference between display and programmatic is the ability to buy ads across platforms.

Display ads are more commonly referred to when placing ads within one specific ad network, such as the Google Display Network.

Programmatic advertising, on the other hand, takes display media to the next level.

Multiple platforms exist for programmatic, such as sell-side platforms (SSPs) and demand-side platforms (DSPs), allowing advertisers to buy ad inventory across an open network of platforms.

With both programmatic and display, advertisers typically have control over the following:

  • Audience.
  • Bidding strategy.
  • Budget.
  • Creative and assets.
  • Placements.

Programmatic Advertising Platforms

Automated technology has made significant strides throughout the years.

There are many types of programmatic platforms.

The three main types of platforms are:

  • Sell-side platform. Also known as a “supply-side platform,” this platform allows publishers to sell their ad impressions to advertisers in real time. This platform encompasses both DSPs and ad exchanges.
  • Demand-side platform. This platform allows advertisers to purchase ad inventory across multiple platforms at once.
  • Ad exchangers. This is how SSPs flow their ad inventory to DSPs. DSPs connect to an ad exchanger, where ad prices fluctuate based on the competitiveness of that inventory.

To familiarize yourself with the different platform types, let’s take a look at some of the major players in each category.

Sell-Side Platforms

A comprehensive list of SSPs for publishers includes:

  • Google Ad Manager.
  • Amazon Publisher Services.
  • OpenX.
  • Google AdMob.
  • Yahoo Ad Tech.
  • TripleLift.
  • PubMatic.
  • Verizon Media.
  • Xandr (Microsoft).
  • Index Exchange.
  • Sovrn.
  • Magnite.
  • Media.net.
  • Criteo.

If you’re looking for a video SSP, some of the leading companies include:

  • SpotX.
  • Teads.
  • AdColony (now DigitalTurbine).

While there are many more available to publishers, these are companies you may have heard of but might not have associated with programmatic technology.

Demand-Side Platforms

Similar to SSPs, these company names may ring a bell and offer DSPs.

Some of the top DSPs include:

  • Display & Video 360 (Google).
  • The Trade Desk.
  • Amazon DSP.
  • LiveRamp.
  • Adobe Advertising Cloud DSP.
  • StackAdapt.
  • Amobee.
  • Yahoo Ad Tech.
  • AdRoll.
  • Basis (formerly Centro).
  • RhythmOne.
  • Choozle.
  • BrightRoll.

Some of the larger DSPs for Connected TV and video include:

  • TubeMogul.
  • OneView (Roku).
  • MediaMath.

Again, there are many more DSPs available to advertisers. It’s important to choose a DSP with the features and inventory you are looking for.

Some DSPs offer self-serve advertising, while others offer both self-serve and full-managed service (likely to larger advertisers or agencies).

Ad Exchangers

Some of the more well-known ad exchangers available to publishers include:

  • Xandr (Microsoft).
  • Verizon Media.
  • OpenX.
  • PubMatic.
  • Google Ad Exchange.
  • Index Exchange.
  • Magnite.
  • Smaato.

Not all ad exchanges are equal.

It’s important for publishers to research options carefully and choose platforms that align with their goals.

How Much Does Programmatic Advertising Cost?

Simply put, programmatic advertising can cost as little or as much as your budget allows.

It’s a common misconception that small businesses can’t benefit from programmatic technologies – but we’re here to correct that.

Programmatic ads are typically bought on a cost-per-thousand-impressions (CPM) basis.

CPMs typically range anywhere between $0.50-$2.00.

However, CPMs can be much higher based on factors such as:

  • Which DSP you choose.
  • Your target audience.
  • The level of competitiveness.

A good rule of thumb for programmatic ad cost is: The more niche your audience, the higher CPM you will pay.

So, whether you’re a multi-million dollar advertiser or a small business just getting started, you can likely fit programmatic into your advertising budget.

What Are The Benefits Of Programmatic Advertising?

There are many benefits to incorporating programmatic advertising into your marketing strategy.

Some of the top benefits include:

  • Large-scale audience reach.
  • Efficient and low-cost awareness.
  • Real-time data and analysis.
  • Ability to utilize first and third-party data.
  • Opportunities for cross-device campaign strategies.

Large-Scale Audience Reach

Arguably the biggest benefit of programmatic advertising is the ability to grow and scale.

Programmatic is the best way to buy ad inventory to reach the masses due to the abundance of cross-platform inventory.

Efficient And Low-Cost Awareness

Related to the above benefit of scaling reach, programmatic is one of the most cost-effective types of advertising out there today.

Earlier, we discussed average CPMs for programmatic averaging between $0.50-$2.00.

Even with a small budget, your marketing dollars can go pretty far to reach your target audience and increase awareness of your product or service.

Real-Time Data And Analysis

Because programmatic platforms rely on real-time bidding, advertisers reap the benefit of receiving near real-time data.

Why does this matter?

Real-time data means you can make faster decisions and pivots. It also puts you in a proactive – instead of reactive – mode.

Utilizing First And Third-Party Data

Another benefit of programmatic advertising is the type of data segments available to advertisers.

For example, advertisers can upload owned first-party data in a secure way and target those people directly, using real-time bidding signals.

Taking that a step further, DSPs have many third-party segments that advertisers can choose to target if they don’t have first-party data.

Another type of third-party data advertisers can leverage is turning their first-party data into third-party data by creating lookalike audiences of their own customers.

This avenue opens the door to finding new customers similar to current ones.

Cross-Device Campaign Strategy

It’s important to note that programmatic advertising is typically seen as an awareness tactic.

Because of this, companies that look solely at last-click success often overlook the true potential of programmatic advertising.

So, how does programmatic fit into a cross-device campaign?

The key is to capture that initial awareness to users through programmatic ads.

Likely, a user won’t purchase a product or service after the first interaction with a brand.

Once a user’s interest is peaked, you have the ability to remarket to them on other platforms based on their interaction or engagement with that initial ad.

Marrying that data together from the first interaction to eventual purchase is key to determining the success of your programmatic strategy.

Types Of Programmatic Advertising

There are different types of programmatic advertising.

These should not be confused with the programmatic platforms themselves.

The types of programmatic advertising are simply how an advertiser purchases ad inventory.

The four most common types are:

  • Real-time bidding. This type of bidding is open to all advertisers, where ad auctions happen in real-time. This is also known as the “open marketplace.”
  • Private marketplace. This bidding happens when publishers have agreements with a limited number of advertisers. These websites typically offer premium pricing because of the coveted ad space.
  • Preferred deals. A lesser-known type of programmatic advertising. Advertisers choose ad spots before they go on the private or open market. This is also known as “spot buying.”
  • Programmatic guaranteed. Similar to a preferred deal, but there is no auction bidding. The publisher and advertiser agree on a fixed price for ad inventory.

Programmatic Advertising Examples

Programmatic ads come in all shapes and sizes.

The beauty of using programmatic ads is tailoring the content to your chosen target audience.

A few well-executed programmatic campaigns include:

Amanda Foundation

The Amanda Foundation is a non-profit animal hospital and shelter rescue in the Los Angeles area.

It created a campaign to help at-risk shelter animals find a home during their final days.

Specifically, it leveraged programmatic signals like location, demographics, and browsing behavior to tailor specific animal images to its audience.

If a user was interested in large dogs, they would be served a banner ad with large dogs instead of smaller dogs.

As you can see, messages and images were tailored to the individual’s behavior and interests.

Image from Amanda Foundation, August 2022

Geico Insurance

You’ve most likely seen or heard some version of a Geico ad.

Have you ever thought about the different ads Geico targets for you, though?

Geico uses such ad formats as TV commercials, website banner ads, social media ads, and more, to create a true cross-platform awareness campaign.

The brand carefully chooses its content based on the platform it serves on, the target audience and demographics, and more.

Its commercials are so popular, in fact, that Geico has dedicated a resource page on its website where users can view their favorite commercials.

Conclusion

The basics and benefits of programmatic advertising can help guide your existing programmatic strategy, or if you’re just getting started, create a new strategy that incorporates programmatic.

Understanding the functionality and features of each platform will be a critical component of your programmatic success.

More resources: 


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Google Rolls Out New ‘Web’ Filter For Search Results

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Google logo inside the Google Indonesia office in Jakarta

Google is introducing a filter that allows you to view only text-based webpages in search results.

The “Web” filter, rolling out globally over the next two days, addresses demand from searchers who prefer a stripped-down, simplified view of search results.

Danny Sullivan, Google’s Search Liaison, states in an announcement:

“We’ve added this after hearing from some that there are times when they’d prefer to just see links to web pages in their search results, such as if they’re looking for longer-form text documents, using a device with limited internet access, or those who just prefer text-based results shown separately from search features.”

The new functionality is a throwback to when search results were more straightforward. Now, they often combine rich media like images, videos, and shopping ads alongside the traditional list of web links.

How It Works

On mobile devices, the “Web” filter will be displayed alongside other filter options like “Images” and “News.”

Screenshot from: twitter.com/GoogleSearchLiaison, May 2024.

If Google’s systems don’t automatically surface it based on the search query, desktop users may need to select “More” to access it.

1715727362 7 Google Rolls Out New Web Filter For Search ResultsScreenshot from: twitter.com/GoogleSearchLiaison, May 2024.

More About Google Search Filters

Google’s search filters allow you to narrow results by type. The options displayed are dynamically generated based on your search query and what Google’s systems determine could be most relevant.

The “All Filters” option provides access to filters that are not shown automatically.

Alongside filters, Google also displays “Topics” – suggested related terms that can further refine or expand a user’s original query into new areas of exploration.

For more about Google’s search filters, see its official help page.


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Why Google Can’t Tell You About Every Ranking Drop

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Why Google Can't Tell You About Every Ranking Drop

In a recent Twitter exchange, Google’s Search Liaison, Danny Sullivan, provided insight into how the search engine handles algorithmic spam actions and ranking drops.

The discussion was sparked by a website owner’s complaint about a significant traffic loss and the inability to request a manual review.

Sullivan clarified that a site could be affected by an algorithmic spam action or simply not ranking well due to other factors.

He emphasized that many sites experiencing ranking drops mistakenly attribute it to an algorithmic spam action when that may not be the case.

“I’ve looked at many sites where people have complained about losing rankings and decide they have a algorithmic spam action against them, but they don’t. “

Sullivan’s full statement will help you understand Google’s transparency challenges.

Additionally, he explains why the desire for manual review to override automated rankings may be misguided.

Challenges In Transparency & Manual Intervention

Sullivan acknowledged the idea of providing more transparency in Search Console, potentially notifying site owners of algorithmic actions similar to manual actions.

However, he highlighted two key challenges:

  1. Revealing algorithmic spam indicators could allow bad actors to game the system.
  2. Algorithmic actions are not site-specific and cannot be manually lifted.

Sullivan expressed sympathy for the frustration of not knowing the cause of a traffic drop and the inability to communicate with someone about it.

However, he cautioned against the desire for a manual intervention to override the automated systems’ rankings.

Sullivan states:

“…you don’t really want to think “Oh, I just wish I had a manual action, that would be so much easier.” You really don’t want your individual site coming the attention of our spam analysts. First, it’s not like manual actions are somehow instantly processed. Second, it’s just something we know about a site going forward, especially if it says it has change but hasn’t really.”

Determining Content Helpfulness & Reliability

Moving beyond spam, Sullivan discussed various systems that assess the helpfulness, usefulness, and reliability of individual content and sites.

He acknowledged that these systems are imperfect and some high-quality sites may not be recognized as well as they should be.

“Some of them ranking really well. But they’ve moved down a bit in small positions enough that the traffic drop is notable. They assume they have fundamental issues but don’t, really — which is why we added a whole section about this to our debugging traffic drops page.”

Sullivan revealed ongoing discussions about providing more indicators in Search Console to help creators understand their content’s performance.

“Another thing I’ve been discussing, and I’m not alone in this, is could we do more in Search Console to show some of these indicators. This is all challenging similar to all the stuff I said about spam, about how not wanting to let the systems get gamed, and also how there’s then no button we would push that’s like “actually more useful than our automated systems think — rank it better!” But maybe there’s a way we can find to share more, in a way that helps everyone and coupled with better guidance, would help creators.”

Advocacy For Small Publishers & Positive Progress

In response to a suggestion from Brandon Saltalamacchia, founder of RetroDodo, about manually reviewing “good” sites and providing guidance, Sullivan shared his thoughts on potential solutions.

He mentioned exploring ideas such as self-declaration through structured data for small publishers and learning from that information to make positive changes.

“I have some thoughts I’ve been exploring and proposing on what we might do with small publishers and self-declaring with structured data and how we might learn from that and use that in various ways. Which is getting way ahead of myself and the usual no promises but yes, I think and hope for ways to move ahead more positively.”

Sullivan said he can’t make promises or implement changes overnight, but he expressed hope for finding ways to move forward positively.


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56 Google Search Statistics to Bookmark for 2024

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56 Google Search Statistics to Bookmark for 2024

If you’re curious about the state of Google search in 2024, look no further.

Each year we pick, vet, and categorize a list of up-to-date statistics to give you insights from trusted sources on Google search trends.

  1. Google has a web index of “about 400 billion documents”. (The Capitol Forum)
  2. Google’s search index is over 100 million gigabytes in size. (Google)
  3. There are an estimated 3.5 billion searches on Google each day. (Internet Live Stats)
  4. 61.5% of desktop searches and 34.4% of mobile searches result in no clicks. (SparkToro)
  5. 15% of all Google searches have never been searched before. (Google)
  6. 94.74% of keywords get 10 monthly searches or fewer. (Ahrefs)
  7. The most searched keyword in the US and globally is “YouTube,” and youtube.com gets the most traffic from Google. (Ahrefs)
  8. 96.55% of all pages get zero search traffic from Google. (Ahrefs)
  9. 50-65% of all number-one spots are dominated by featured snippets. (Authority Hacker)
  10. Reddit is the most popular domain for product review queries. (Detailed)

  1. Google is the most used search engine in the world, with a mobile market share of 95.32% and a desktop market share of 81.95%. (Statista)
    63.41% of all US web traffic referrals come from Google.63.41% of all US web traffic referrals come from Google.
  2. Google.com generated 84.2 billion visits a month in 2023. (Statista)
  3. Google generated $307.4 billion in revenue in 2023. (Alphabet Investor Relations)
  4. 63.41% of all US web traffic referrals come from Google. (SparkToro)
  5. 92.96% of global traffic comes from Google Search, Google Images, and Google Maps. (SparkToro)
  6. Only 49% of Gen Z women use Google as their search engine. The rest use TikTok. (Search Engine Land)

  1. 58.67% of all website traffic worldwide comes from mobile phones. (Statista)
  2. 57% of local search queries are submitted using a mobile device or tablet. (ReviewTrackers)
    57% of local search queries are submitted using a mobile device or tablet. 57% of local search queries are submitted using a mobile device or tablet.
  3. 51% of smartphone users have discovered a new company or product when conducting a search on their smartphones. (Think With Google)
  4. 54% of smartphone users search for business hours, and 53% search for directions to local stores. (Think With Google)
  5. 18% of local searches on smartphones lead to a purchase within a day vs. 7% of non-local searches. (Think With Google)
  6. 56% of in-store shoppers used their smartphones to shop or research items while they were in-store. (Think With Google)
  7. 60% of smartphone users have contacted a business directly using the search results (e.g., “click to call” option). (Think With Google)
  8. 63.6% of consumers say they are likely to check reviews on Google before visiting a business location. (ReviewTrackers)
  9. 88% of consumers would use a business that replies to all of its reviews. (BrightLocal)
  10. Customers are 2.7 times more likely to consider a business reputable if they find a complete Business Profile on Google Search and Maps. (Google)
  11. Customers are 70% more likely to visit and 50% more likely to consider purchasing from businesses with a complete Business Profile. (Google)
  12. 76% of people who search on their smartphones for something nearby visit a business within a day. (Think With Google)
  13. 28% of searches for something nearby result in a purchase. (Think With Google)
  14. Mobile searches for “store open near me” (such as, “grocery store open near me” have grown by over 250% in the last two years. (Think With Google)

  1. People use Google Lens for 12 billion visual searches a month. (Google)
  2. 50% of online shoppers say images helped them decide what to buy. (Think With Google)
  3. There are an estimated 136 billion indexed images on Google Image Search. (Photutorial)
  4. 15.8% of Google SERPs show images. (Moz)
  5. People click on 3D images almost 50% more than static ones. (Google)

  1. More than 800 million people use Google Discover monthly to stay updated on their interests. (Google)
  2. 46% of Google Discover URLs are news sites, 44% e-commerce, 7% entertainment, and 2% travel. (Search Engine Journal)
  3. Even though news sites accounted for under 50% of Google Discover URLs, they received 99% of Discover clicks. (Search Engine Journal)
    Even though news sites accounted for under 50% of Google Discover URLs, they received 99% of Discover clicks.Even though news sites accounted for under 50% of Google Discover URLs, they received 99% of Discover clicks.
  4. Most Google Discover URLs only receive traffic for three to four days, with most of that traffic occurring one to two days after publishing. (Search Engine Journal)
  5. The clickthrough rate (CTR) for Google Discover is 11%. (Search Engine Journal)
  1. 91.45% of search volumes in Google Ads Keyword Planner are overestimates. (Ahrefs)
  2. For every $1 a business spends on Google Ads, they receive $8 in profit through Google Search and Ads. (Google)
  3. Google removed 5.5 billion ads, suspended 12.7 million advertiser accounts, restricted over 6.9 billion ads, and restricted ads from showing up on 2.1 billion publisher pages in 2023. (Google)
  4. The average shopping click-through rate (CTR) across all industries is 0.86% for Google Ads. (Wordstream)
  5. The average shopping cost per click (CPC) across all industries is $0.66 for Google Ads. (Wordstream)
  6. The average shopping conversion rate (CVR) across all industries is 1.91% for Google Ads. (Wordstream)

  1. 58% of consumers ages 25-34 use voice search daily. (UpCity)
  2. 16% of people use voice search for local “near me” searches. (UpCity)
  3. 67% of consumers say they’re very likely to use voice search when seeking information. (UpCity)
  4. Active users of the Google Assistant grew 4X over the past year, as of 2019. (Think With Google)
  5. Google Assistant hit 1 billion app installs. (Android Police)

  1. AI-generated answers from SGE were available for 91% of entertainment queries but only 17% of healthcare queries. (Statista)
  2. The AI-generated answers in Google’s Search Generative Experience (SGE) do not match any links from the top 10 Google organic search results 93.8% of the time. (Search Engine Journal)
  3. Google displays a Search Generative element for 86.8% of all search queries. (Authoritas)
    Google displays a Search Generative element for 86.8% of all search queries. Google displays a Search Generative element for 86.8% of all search queries.
  4. 62% of generative links came from sources outside the top 10 ranking organic domains. Only 20.1% of generative URLs directly match an organic URL ranking on page one. (Authoritas)
  5. 70% of SEOs said that they were worried about the impact of SGE on organic search (Aira)

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