I am sure we have all experienced an advert of something we ordered/bought on Amazon, a car we liked on a Japanese car sales website or a product we looked following us on our social media pages or as we catch up on the latest news on our favorite news sites. I’m sure this has made you wonder how they are doing this and in some instances creeped you out. A friend of mine asked me to explain how this works to him and just thought it would be great to share how this cool technology works with you guys too.
The technology that’s used to do this is called programmatic advertising, and it’s basically a fancy automated way of delivering online adverts to the right people at the right time. Programmatic advertising saves advertiser’s money by delivering the advert to relevant audiences and saves us the consumers the bore of seeing adverts of things we don’t want or need. It does this by replacing humans with computers and algorithms in the advert placement process.
So, this is how it works, firstly we the consumers are segmented and pooled based on multiple demographics which include but are not limited to gender, age, location, online behavior, products you have bought or liked before, websites you have visited before etc, cookies are the common source of this information.
Secondly, advertisers submit adverts to Google through a platform which is linked to the Display network (the display network is simply put, thousands of websites which have advertising space for sale and your favorite news site is most likely one of them). The last step is, the moment you visit your favorite news website that’s on the Display network and you are a mother with a 5-month baby who has bought pampers or visited the pampers website before, you get a pampers advert popping up in the corner.
Same thing applies if you have recently looked at a specific car on a Japanese Car Sales website when an advert of this same car follows you on Facebook. How cool is that?
Simply put this is how programmatic advertising and marketing works. This does not, however, mean that it’s this simple as there are algorithms, real-time bidding, and exchanges involved to ensure that the right advert is delivered to the right person at the right time. The fascinating thing is that all this happens in milliseconds as your page loads.
I know Google offers programmatic services but there are many other programmatic service providers out there (watch below video by Genious Monkey for a more detail).
The decision whether this technology is good or not is completely up to you, but I hope my explanation has helped you understand online advertising a bit better.