By Shawn Aguilar

The popularity of mobile programmatic advertising has recently soared. The subject is mentioned frequently in popular advertising trade journals, at conferences and in social media. But what exactly is mobile programmatic advertising? And what is its effect on media buying?

What is mobile programmatic advertising?
Mobile programmatic advertising is the automatic buying and selling of mobile ad inventory with software. It replaces the request for proposal (RFP) process, in person negotiation and the insertion order (I/O) system.

The technology makes ad buying more efficient and cheaper for advertisers, because it allows them to access a wide selection of inventory, typically through an ad exchange. It also helps maximize value by finding the best possible price for inventory at any given time.

Programmatic advertising technology also makes it easy to buy audience segments across a varied selection of publishers.

Traditionally, advertisers thought of audience segments by publisher. Buying all the ads on a given publishers based on its audience index against a tool such as comScore.

Now, with programmatic technology and the advent of Big Data, advertisers can target the right audience on a variety of publishers.

For example, in mobile geo-targeting is a popular buying method that is done programmatically across as many publishers as possible. This allows an advertiser to get maximum scale in a given geography.

This does not mean that you cannot buy directly from a single publisher with programmatic technology. The systems make it easy to buy a guaranteed amount of impressions from a specific publisher. This is known as “programmatic direct.”

Programmatic direct allows you to leverage your previous relationships while taking advantage of programmatic ad serving to ensure that you get the most targeted impressions.

Why is it getting so much press?
Mobile programmatic is a fundamental shift in how advertising has been done. The transition is very similar to what happened with digitalization of stock markets.

The time-consuming manual process of writing a stock purchase slip and having it processed by hand at trading desk was replaced with computerized trading. This revolutionized the stock market and brought the transaction price way down, which has been great for consumers who can now buy stock for as low as seven dollars per trade.

Advertising is now going through a similar revolution.

Before programmatic, you had a sales team trying to sell publisher inventory to brands, agencies and other advertisers directly. This process was manual and inefficient.

Programmatic technology shrinks the overhead cost on both the advertiser and publisher sides, which has increased their margins. This has opened the door to a huge new market of small advertisers that previously could never afford to buy ads.

How much does mobile programmatic cost?
Programmatic technology can actually save money. Through automation, many tasks have been eliminated making the process more efficient and reducing implementation costs.

The technology is also good at finding the best price across a variety of publishers. This frees up teams to focus more on creativity or research, improving the quality of campaigns.

How can I take advantage of programmatic?
There are a few ways to take advantage of programmatic buying.

One is you can go directly to an ad exchange and buy inventory through them. This will require technical integration and ad buying technology that you maintain, which is referred to as a demand side platform (DSP).

If you are an agency, you can create a trading desk that integrates with multiple ad exchanges and DSPs.

Lastly, if you are a smaller buyer there are lots of DSPs that specialize in a particular area such as application downloads, for example. There are many trade shows where you can find a specialist that handles the area of advertising on which are focused.

Shawn Aguilar is digital marketing manager at TapSense, San Francisco. Reach him at [email protected].