Advertising is an important part of any business. It is how a brand or company can connect with and reach new customers, and it is important for increasing revenue and brand awareness. With current technology, a lot of advertising is done online, and the goal is to target potential customers to maximize advertising inventory.
Additionally, advertising is an industry, and the goal of the publishers is to make a high revenue while providing a quality service. They use both direct and programmatic ads to target different needs depending on the budget, type of ad campaign, target audience, and goal that the brand has.
Publishers and advertisers work together to achieve high-quality, efficient ads to draw customers to both of their businesses. Advertisers want customers to purchase their products or services, and publishers want more businesses to advertise with them.
Direct Ads
Direct advertising is when the website directly sells an advertisement to a company or advertiser. This means that there is a human component involved, as sellers work to sell advertisements and manage campaigns that have already been sold. Websites intend to increase revenue from selling advertisements, and they aim to attract advertisers who have similar customer bases to themselves.
With direct ads, companies and brands can choose exactly where they want to show their advertisements and which websites they want to affiliate with. There is a personal interaction between the advertiser and the place where they want to advertise, and direct input can be made from both sides.
Benefits
The biggest benefit of direct advertising is that it can be customized. With programmatic advertising, while it is fast and efficient, it is not easily customized, and it is all done through an algorithm.
For really unique, eye-catching advertisements, direct advertising is the way to go. Similarly, sponsorships can be created that align with a brand or company’s values and goals. Working with a human marketing team can create brilliant ads that a computer simply cannot match, and if a company has the budget, it can be a worthy investment.
Additionally, those who publish the ads can get better paychecks by working with direct advertising. Programmatic deals can be lucrative, but they will also only ever reach a certain threshold. With direct advertising, the publishers of ads get to work with specific brands, which can be a benefit to those working on the ad campaign.
Programmatic Ads
Programmatic ads are digital advertising that is generally automated. This means that there is no person responsible for negotiating, creating insertion orders, or making requests for proposals. Ads can be purchased or placed almost instantly using programmatic ads since there is no human component that requires additional time, energy, and money.
Programmatic ads use algorithms to decide when and where to place the ads, and they can be targeted to specific customers to maximize success. Programmatic ads take advantage of new technologies to make the process of buying and relaying advertisements faster and more efficient.
Programmatic Advertising Platforms
There are three main types of programmatic platforms – sell-side platforms, demand-side platforms, and ad exchanges. As technology has advanced, these platforms have also advanced to allow for improved mechanisms for advertisements.
Sell-side platforms are those that allow those who publish the ads to sell impressions to those who buy the ads in real-time. This means that anyone who is purchasing an advertisement can see how many people have viewed the ad at any time. This can help them decide if the advertisement is reaching a large enough market, and they can see how that translates into revenue.
Demand-side platforms are those that let those who are buying the ads purchase them from several platforms at once. This cuts down on the time and effort that goes into purchasing advertisements, and it makes the entire process much more efficient.
Ad exchanges are the ways that sell-side platforms move advertising inventory to demand-side platforms. A demand-side platform will connect to an ad exchanger, and through this exchanger, prices will change based on the demand. The more competitive the ad inventory is, the higher the price will be, and it all depends on the ad exchanger.
Benefits
The goal of programmatic advertising is to make the process of executing an ad campaign easier. With programmatic advertising, there is no need to worry about invoices, direct negotiations, or insertion orders for ads.
An advertiser must provide their creative goal, estimated budget for the campaign, and target audience. The publisher then provides their inventory for advertisements, and the campaign is created using algorithms to match the needs and availability of the advertiser and publisher.
Programmatic advertising is the leading form of advertising today, which means that there is access to anything that a brand or company might be looking for. It is easy to access, and many different platforms allow advertisers and publishers to buy and sell ads easily.
The Effect of Programmatic Ads on Publishers
Publishers can provide a high quantity of ads at fast speeds by using programmatic ads. They will have to create an algorithm to make sure these ads run efficiently and well, which involves coding and technology, but once the technical foundation is finished, this process requires minimal upkeep and work compared to direct ads.
Programmatic ads will make the publisher a small amount of money per ad, but an increased number of ads can lead to large revenues. However, there is only limited advertising inventory, so using it all up on programmatic ads can lead to a lower total revenue since publishers tend to be able to make more money overall for direct ads since they cost more per spot in the inventory.
There are many benefits to direct ads for publishers, as shown here. The main reason for this is limited inventory, as there are only so many available spots for ads on different websites and locations. Direct sales also benefit a publisher’s overall revenue and relationship with the companies and brands that they are working with.
4 Key Differences Between Direct and Programmatic Ads
Programmatic and direct advertising have distinct differences that, at times, can make it difficult to pick which one to use. Four important differences can help you distinguish between the two – cost, speed, customization, and targeting audiences.
Cost
Direct advertisements will cost more per ad than programmatic ads will. This is because they require a human element that involves time, money, and other resources. The advertiser will pay more for each ad to the publisher to make up for these additional costs.
Programmatic ads rely on an algorithm, so publishers do not have the same costs as they do with direct ads. The algorithm must be coded, but once it is complete, it can largely function on its own. The ad campaigns will be run using technology and not people, which means a lower cost per ad.
When working with a bigger budget, there will be more flexibility to decide what type of advertisements to use. However, small businesses are not limited to only programmatic ads, they just might have to lower the quantity or otherwise change the way their campaign works.
Speed
Programmatic ads can reach customers faster than direct ads because the entire process is very fast. The information must be input into the advertising platform, but after that, the technology takes over, and all the advertiser has to do is monitor how their campaign is doing. The entire process can take a few minutes, and it is very easy and quick.
With direct ads, a brand or company has to work to design the ads, make deals with the publishers, and work out all the details. Everything has to be done manually, which means that it will take longer. Therefore, the marketing team must make sure to allow for a good amount of time before they need their ad campaign to officially launch to make sure that everything will be released on time.
Customization
For premium, highly visible advertisements, direct advertisements can better fit the customers who might be viewing the ads. Programmatic advertising relies on an algorithm that cannot be highly customized.
However, if these ads need to be changed regularly, direct advertising may take a significant amount of time to update and shift the ad campaign, which might make programmatic ads preferable because they can be very quickly altered.
Depending on the type of customization required, you might need to use one advertising type over the other. One type may be customized more intensely, while the other may be customized faster to better keep up with current trends.
Targeting Audiences
Programmatic ads are based on a customer’s search history and demographics, and they are entirely based on an algorithm. This means it lacks a personal factor and is instead based on data, which can make it more or less accurate depending on the campaign’s intention.
While it is likely to reach potential customers with programmatic ads, audiences can be more directly targeted with direct ads. Ads can be placed on specific websites to give the best chance for the advertisement to reach potential customers.
Both types of ads target specific audiences, but the way they do so is different. Programmatic ads rely on an algorithm, while direct ads use human influence to decide which audiences to target. Both methods can be valuable, and which one to use might depend on what you are advertising and who your potential customers are.
Which to Choose?
Whether you prefer programmatic or direct advertising depends on what you want to prioritize with your ad campaign. If you are looking for a lower cost per ad, programmatic advertisements might be the way to go. If you want extremely personalized, custom advertisements, direct advertising will be your best option.
For an ad campaign that needs to come out fast, a programmatic ad can lower the time from creation to when it reaches audiences and potential customers.
Depending on your budget, you can use both programmatic and direct advertising together. Data gained from programmatic advertisements can give publishers information about when they should use direct advertising with that advertisement. Data from direct advertisements can allow for websites to be optimized for different trends in advertising and to see what currently works best based on what customers respond to.