It's December, believe it or not, which means it's time for a new blog theme! We are switching over to Mobile and have a great post to kick it off by Samantha Lordi, Marketing Content Manager at Fiksu. Samantha gives insight on why when it comes to mobile marketing, programmatic is key.
Samantha Lordi, Marketing Content Manager at Fiksu, has a Broadcast Journalism degree from Syracuse and an MBA from Seton Hall. Despite being relatively new to the mobile industry, she uses her experience with storytelling to write about new technologies and trends affecting the mobile industry. Twitter- @samlordi
Programmatic is likely to be mobile’s buzzword of 2015. The only problem is, most people don’t even know what it really means. According to a report from STRATA from earlier this year, over 60 percent of ad agency executives feel there’s no accurate, unified definition of the term. Here at Fiksu, we’ve defined programmatic buying as “an automated process to make inventory placement decisions, execute on those decisions, and incorporate closed-loop feedback.”
Essentially, programmatic buying takes the manual or human element out of the equation, automating an otherwise laborious auction-style process. The element of closed-loop feedback, also known as real-time optimization, is especially important. It means prior decisions and results inform future decisions and results, and so on and so forth. By "learning" from previous results, programmatic buying ensures the best possible outcomes at the lowest possible costs and the largest scale.
The most well known form of programmatic buying is RTB, or real-time bidding. You’ve probably heard of it – it's been around in the desktop Web for a while – but you may be curious how it works. Well, wonder no longer:
User visits mobile site or app
Exchange notified of impression or opportunity
Bid requests sent to DSPs
DSPs evaluate bid
DSPs send bid response
Exchanges receives response & winner is chosen
Exchange sends win notification
Winning ad is shown
Sounds complicated, doesn’t it? And that's before considering that the entire process occurs in less than 200 milliseconds. Imagine how long that would take if it had to be done by a person, rather than by a computer.
Knowing that, it isn’t too surprising that RTB on mobile is growing dramatically. According to Smaato, global mobile RTB spend increased 140 percent year-over-year from Q3 2013 to Q3 2014. And that growth isn’t expected to slow. According to eMarketer, RTB (on desktop and mobile) is predicted to grow from $4.16 billion in 2013 to $11.84 billion in 2016, a 185 percent increase.
But RTB isn’t the only form of programmatic buying. Here at Fiksu, we also have programmatic access to networks like Facebook and Twitter. And non-RTB programmatic may actually present the biggest opportunity going forward. According to eMarketer, non-RTB programmatic buying is actually expected to grow from $0.08 billion in 2013 to $8.57 billion in 2016, a staggering 100x increase in just three short years.
So what does it mean for you? Well, in the most basic terms, you should be buying your mobile media programmatically. It saves time and money, and increases the effectiveness of your results with closed-loop feedback. It’s the future of mobile marketing, and that future is fast approaching.