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Programmatic Advertising and Audience Targeting

Updated: Jul 27, 2022

A Brief Overview of Programmatic Advertising

In 2021, programmatic advertising accounted for approximately 90% of all digital display marketing. So, what is programmatic advertising? Simply put programmatic advertising is the use of artificial intelligence (AI) to purchase digital advertising space rather than a human. The goal is to increase the efficiency and transparency of both the advertising and the publisher. RTB, or real-time bidding, accomplishes this by purchasing advertising at the same time a visitor loads a page.

Unlike traditional types of advertising, programmatic advertising is offered on an individual basis. It allows advertisers to locate and target consumers based on their unique qualities, activities, and affinities, regardless of where they are on the internet.

Data rule progressive advertising. When you have information on your audience's personal characteristics, values, beliefs, and attitudes, you can use psychographics. People can be divided into categories based on if they are family-oriented versus individualistic, leaders versus followers, or thrill-seekers against homebodies, for example. Geographic location, gender identity, age, ethnicity, wealth, and amount of formal schooling can all be used to create subgroups. Subsets can also be formed based on historical behavior, such as past purchases.

Programmatic Advertising and Audience Targeting

The capacity to segment your whole audience of potential clients into groups based on various factors such as online behavioral characteristics, demographics, interests, and intent is known as audience targeting. Audience targeting allows you to create more personalized and optimal experiences depending on the requirements and interests of your customers. Audience Targeting is a powerful tool in the arsenal of a marketing director.

Audience targeting is critical for marketers who are constantly striving to reach the right people with the right messaging at the right moments. After all, if your ads aren't properly targeted, you'll have sluggish campaign performance, wasted ad spend, and terrible consumer experiences on your hands. Brands that prioritize best practices for audience segmentation and use people-based data to generate tailored audience groups will be able to stay up with their customers' journeys as their demands and circumstances vary in programmatic.

You can save both time and money by driving the right traffic to your site. In many companies, time and money spent on unqualified leads and inefficient marketing methods are among the worst wastes of resources. When you don't target accurately, you end up creating and disseminating messages with a very low chance of attaining desired results with unqualified prospects. Your representatives waste time and energy on ineffective activities and conversations with individuals who are uninterested in your product or service.

Take, for example, pay-per-click advertising. So, what is Pay Per Click advertising? In the advertising paradigm of programmatic internet marketing, advertisers pay the price each time one of their commercials is clicked. It's basically a method of buying website traffic rather than trying to "earn" it organically, as we talked about above.

This can be effective when matched with audience targeting, but when it's not targeted, the results can be disastrous. You could be paying for 1,000 clicks and be only generating one sale. That is a very low return on investment. When you target the ads leading to the clicks, you may have fewer visitors, but these visitors are more likely, once again, to buy your product or service. This means that instead of losing money on clicks, you are actually gaining it.

Audience targeting can also allow you to advertise at little to no cost with organic traffic.

When you know your target audience, you can tailor the ad experience to their needs, interests, and beliefs to draw organic traffic to your website. Organic traffic is valuable and beneficial because it does not demand a large investment but yields long-term effects, allowing you to optimize your profits. Organic traffic refers to visitors who arrive at your site after clicking on search engine results.

It cannot be stated nearly enough! Engaging the right audience is far more important than driving any audience to your website! Imagine you are a pharmaceutical company selling a medication used to help alleviate joint pain in the elderly. Even if you develop the perfect ad, if you target 20-40-year-olds for your ad, you will most likely squander your time and money. The goal is to show the advertisement to the correct people, not to everyone. With organic traffic, you can attract potential clients to your business by speaking directly to the demographic you're targeting. Since the keywords that targeted these users are based directly on the demographics most likely to engage with your product or services, the potential to make a sale is much higher than it would be otherwise.

Getting Started with Audience Targeting

Data is Everything

We've said it in previous posts, and we will say it again, data is king when it comes to successful marketing strategies. In this case, your data is all about knowing your target audience. To gather that information, you will need to partake in both quantitative and qualitative research.

In a nutshell, quantitative market research is the process of gathering vast volumes of data via surveys, questionnaires, and polling techniques. The goal of quantitative research is to gather trustworthy, standardized information and figures to help answer crucial business questions such as "Does our product have a strong market?" or "How important is this service to our customer base?" Quantitative data from primary research is frequently collected using surveys and questionnaires. To provide insights, quantitative data gathering methods often rely on closed-ended questions. The field of research participants must be broad enough, with special care dedicated to ensuring adequate audience representation.

Qualitative market research, on the other hand, entails determining customer motivation through careful observation –– usually in a small group or face-to-face meeting. The goal of qualitative research is to gain a better understanding of customer motivation and emotion. Quantitative research i