Few components of advertising techniques are more crucial than programmatic advertising. To say that this innovation represents a digital marketing game-changer is the understatement of the year, and we’re still at the beginning!
In 2019 alone, programmatic marketing skyrocketed to an ad spend of $98 billion. That represents 68 percent of ALL global digital media spend. Those are impressive figures by any standards.
These stats raise some interesting questions about the future of programmatic advertising that we’re going to explore. Of course, one thing’s for sure. More groundbreaking changes are on the horizon.
For example, new applications of machine learning and artificial intelligence will continue to streamline the programmatic advertising process. That’s just the beginning, though.
Keep reading for a breakdown of the biggest programmatic advertising trends of 2020 so that you can get in on the momentum from the get-go.
Applications of Artificial Intelligence and Machine Learning in Programmatic Marketing
Artificial intelligence (AI) and machine learning (ML) both continue to evolve and mature.
As a result, more marketers are looking towards AI and ML to help fill the gaps when it comes to processes like targeting, audience selection, measurement, and campaign optimization.
What will new applications of AI and ML mean in 2020 and beyond? These technologies will sift through massive volumes of data, finding patterns and predicting outcomes.
We live in the age of “Big Data.” While this represents a potential-laden time, many marketers feel crippled by data deluge. AI and ML will step up to lighten marketers’ loads going forward.
How AI and ML Will Change the Marketing Landscape
AI and ML will also be able to make recommendations based on the next best action to take with individual consumers. That way, marketers will gain valuable insights to help nudge consumers along the buyer’s journey.
The scale, speed, and intelligence with which AI, in particular, can execute such functions will astound marketers and, yet again, change the playing field.
How will marketers see this data? As real-time data points from gender to location, preferences to viewing metrics. Other metrics AI will consider include where an ad gets placed, for how long, and in what format.
Accounting for these factors, AI will increase the overall impact of advertising. The result? Decreased customer acquisition costs.
How far down the road is this technology? Consider the case of IBM’s AI bot Watson, currently being optimized for programmatic media buying, and already popular in the UK and US.
What kind of results is Watson getting? A stunning reduced cost per clicks (CPC) of 71 percent. Talk about some fantastic tech savings!
Gaining a New Perspective on the EU’s General Data Protection Regulation
Remember back in May of 2018 when the General Data Protection Regulation (GDPR) went into effect in Europe? Many marketers were beside themselves, seeing the move as a significant advertising setback.
Fast forward to today, and the GDPR has ended up being surprisingly beneficial. How? In its attempt to protect the privacy of user data, the GDPR has resulted in cleaner, more reliable data sets.
Sure, the scale of data has declined, but the data that is available proves a much higher quality overall. That’s an excellent development from a marketing standpoint.
After all, the number one rule of effective marketing remains knowing your client. It doesn’t matter how much data you compile. If it’s not accurate, then how can you ever really get to know your ideal customer?
Better Data Means More Qualified Leads
Working with cleaner, more accurate data will continue in 2020. Why? Because of digital platforms and policies that fall in line with the GDPR’s privacy regulations.
Because of the GDPR, companies have had to branch out and communicate more effectively and directly with their customers. They’ve had to become more transparent.
Again, these are significant developments from a marketing standpoint.
Here’s our analysis based on these findings. A continued supply of cleaner data will translate into more relevant, qualified leads and increased mutual trust between the user and the publisher.
Programmatic marketing will continue to offer the assurance of reaching out to only those prospects who are genuinely interested and ready to make informed buying decisions. In other words, the theme of 2020 will be quality over quantity.
Voice-Activated Ads Will Boom
2019 poised us on the edge of the voice-activated device revolution. Expect to see the implications of this revolution reverberate throughout the next decade.
The adoption of in-home smart devices has already exploded. According to Amazon, more than 100 million Alexa devices have sold. What’s more, customers engaged with Alexa tens of billions of times in 2018.
Besides this, Gartner has predicted that this year, 30 percent of web browsing sessions will occur via voice activation. We can already see this transition happening, and it’ll have major repercussions for advertising.
People rely on their voice assistants to learn more about specific products and where to buy them. In the process, they listen to relevant lists of other products and where to purchase them, too.
Nonetheless, taking full advantage of voice-activated ads represents a brave new frontier of advertising. The prize, of course, will go to those companies who learn how to maximize this potential.
What role will programmatic advertising assume in terms of voice-activated content?
According to our analysis, it will help marketers optimize their ad spaces across multiple smart-home devices. It will also provide opportunities for sales via apps and in-store audio.
Vibenomics is already doing this by allowing brands to connect with consumers through in-store background ads.
How does this work? Vibenomics uses speakers installed in brick-and-mortar stores, taxis, elevators, and waiting rooms CCTVs to deliver targeted advertisements to prospects.
Mobile Home Location Data Will Combine with Digital Out-of-Home (DOOH) Advertising
The oldest and most traditional channel, out-of-home advertising, is about to get a necessary overhaul. Its digital version (digital OOH or DOOH) is already being combined in compelling ways with mobile location data.
Expect this trend to continue. Why? Because it has the potential to redefine how marketers target consumers during the critical travel time between their residence and the store. This technology will get implemented both on and offline.
The result? Mastering this capability will have a dramatic impact on the scale and efficiency of the programmatic buying model. It’ll also mean a seamless experience for customers.
It will result in new integrations between mobile locational data and the DOOH to drive conversion even when people are offline.
Projecting the implications of these new technologies, it’s safe to say there will be a significant shift away from buying and trading outdoor ad spaces.
REI has already gotten involved in early tests of these technologies. They crafted a campaign by targeting consumers in the places they were most likely to spend their time according to locational data.
The result? An increase in purchase intent of seven percent and a 14 percent shift in brand awareness.
What were the real-world implications of REI’s experiment? An increase in store traffic by 3.6 times.
Programmatic Advertising Will Get a Boost from Wearables
Okay, now we’re starting to head into Sci-Fi territory here. Wearables refer to things that people wear that collect data about their location, health metrics, lifestyle, and more.
Still not sure what we mean by wearables? Well, just think about your smartwatch for a moment and all of the potential it has when it comes to targeting customers.
By tracking data from wearables, marketers will develop a stronger sense of who their customers are. Then, they can use behavioral targeting in innovative ways to their advantage.
If you think this sounds like something light-years away, think again. Already, FitAd delivers automated advertisements, including banners, to customers wearing Samsung and Sony watches.
Imagine the advertising future if marketers can harness this technology to display relevant ads based on customer behaviors, locations, and other basic needs!
Personalization Will Continue to Expand
When it comes to demographics such as Millennials and Gen Zers, they share something in common. A preference for personalized ads.
And can you blame them?
With more digital tools at our fingers than ever before, individuals also have less tolerance for generic ads that aren’t relevant to them. That’s why personalization will continue in 2020 and beyond, bolstered by technology.
Programmatic customization will continue to advance how advertisers develop the most relevant and targeted content for prospects. The abundance of data that we mentioned earlier will help do this. (With help from AI and ML, of course.)
So, expect to see a continued rise in highly customized messaging to target audiences. How? With more access than ever before to the things that matter like demographics, device type, time, and location.
Programmatic advertising allows marketers to measure the success of campaigns in real-time and make adjustments as needed. This flexibility, in conjunction with hyper-specific data, will lead to many far-reaching possibilities.
Just take a look at the example of Mindshare. Mindshare is a media agency that recently developed a retargeting campaign for one of their Indonesian subsidiaries, AirAsia. They used dynamic creative optimization technology to do this.
This approach allowed them to run more than 5,500 different versions of the same ad based on the last destination searched by each consumer. The result? A savings of 276 days of production time for the airline.
Don’t Count Out Blockchain!
As blockchain technology continues to gain traction, we’re going to see more of it. Ad fraud accounts for $26 billion in lost revenue each year.
How to stop this bleed? Through the use of more transparent technologies such as blockchain in the programmatic advertising process. Blockchain will also help eliminate unnecessary middlemen who continue to plague the advertising industry.
Blockchain will remove issues associated with domain spoofing and help verify the legitimacy of publishers. It will also allow transactions to occur in cryptocurrencies.
Blockchain will act as a guard to digital advertising, providing the securities long needed. One way it’ll do this will be through the prevention of unauthorized reselling of ad inventory with solutions such as ads.txt.
This development will lead to listings of all the companies allowed to sell a publisher’s inventory. In other words, blockchain and ads.txt will provide much-needed cyber-hygiene for advertisers moving forward.
Now’s the Time to Go with Omnichannel or Integrated Programmatic Advertising
Omnichannel is the wave of the future. There’s no way around it.
Why? Because multi-device ownership is on the rise, which makes the transition to Omnichannel necessary. Omnichannel marketing, in a nutshell, refers to the practice of digitally sequencing ads across a variety of channels.
It allows advertisers to stay more connected with consumers while providing them with the most relevant content consistent with the stage they occupy on the buyer’s journey.
Adopting an Omnichannel approach is a crucial game-changer. It will allow advertisers to reach customers at every step of the buying process. Programmatic advertising will help them do this through dynamic customer behavior analysis.
This innovation will render the ad buying process more productive while allowing it to sync with the Omnichannel environment.
The Marketing Solutions You Need Heading into 2020
As you can see, an exciting new world of programmatic advertising will unfold this year and beyond. From AI and ML to voice-activated ads and wearables, there are many captivating new ways to reach your target audience.
That is, if you know how to take full advantage of these programmatic advertising trends heading into the new decade. What if you’re feeling overwhelmed and don’t know how to proceed?
No worries. We’ve got you covered! Contact us to schedule a free marketing consultation where we’ll discuss how to take advantage of these tantalizing opportunities in 2020 and beyond.
