The Basics of Digital Advertising

This article was originally posted on the AdBistro blog. Read the original article here.

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Digital advertising is really any marketing or advertising media that is digitally displayed. This most commonly refers to internet, mobile and hand-held media devices, but could also be out-of-home media like billboards or other digital banners. Here is a quick rundown of some basic digital ad types and key terms.

Digital Advertising Inventory

Advertising inventory is the number of ads, or amount of ad space, a publisher has available to sell to an advertiser. In the context of display ads, this inventory would be the individual ad units on the website. Inventory standards are set by groups like IAB (Interactive Advertising Bureau). IAB specifications for programmatic selling and buying of inventories deliver greater efficiency and reliability.

Digital Advertising Platforms

• Search Advertising: Also called paid search, search ads are advertising on search engines like Google, Yahoo and Bing. There are over 3.5 billion searches per day on Google, ignoring this market is missing out on a big opportunity.
• Display Advertising: These ads are the banners on websites that include images or videos. Internet users using ad-blockers make it more difficult to see high engagement rates on these types of ads. As a result, native advertising and other forms of digital advertising are becoming more popular.
• Mobile Advertising: Mobile advertising is a method of advertising that shows up on a mobile device, like a smartphone. These could be text message advertisements, embedded in apps, or display ads on mobile websites. While many of the same tactics are used when targeting mobile users as desktop users, research suggests that engagement in mobile users is slightly higher.
• Social Advertising: Hootsuite calls social advertising, “any kind of paid content on a social media network. The options run from a one-off promoted Tweet or Facebook post to a full-scale campaign with major budgets attached.”
• Demand-side Platforms: A demand-side platform is “a piece of software used to purchase advertising in an automated fashion.” according to Digiday. Advertisers and agencies most often use DSPs in the ad buying process.

What is native advertising?

Native advertising is a form of paid media, where the paid content resembles the surrounding website/content. By blending with the rest of a webpage, (or even non-digital forms like magazines) the content is more user-friendly. As a result, native ads have a much higher engagement rate than traditional display ads.

What is programmatic advertising?

Programmatic ads are ads that have a completely automated buying process. Buying these ads is more efficient because a computer can monitor and bid on ads rather than having a person actually following and bidding on them. The automated buying process allows advertisers to reach specific audiences with pinpoint accuracy.

Prior to programmatic, the ad buying process was approached as direct sales. The advertisers and publishers would go back-and-forth with hundreds of spreadsheets, proposals, emails, etc. While this process is still used somewhat, it is less common thanks to programmatic.

Real-Time Bidding (RTB) vs. Automated Guaranteed

Both real-time bidding (RTB) and automated guaranteed are methods of programmatic ad buying. Real-time bidding buys impressions one at a time, based on who an advertiser is targeting. Advertisers bid by impression and if they win, their ad is immediately displayed.  This is the advantage to RTB, its ability to publish in an instant.  Automated guaranteed, or direct buying, allows marketers to buy ad impressions in bulk for a specific context or website, ESPN.com for example. The advantage to direct buying is that both the inventory and the price are guaranteed. However, once the deal is complete the advertiser loses control of when their ads are published on the site.

Why use digital advertising?

Quite simply, you should spend money on digital advertising because your competitors are doing it. If you neglect your business’ digital presence, your competitors will be at an advantage by reaching your target customers more often. Another reason is digital advertising’s superior tracking and measuring capabilities. Measuring a campaign’s ROI can be as simple as logging into Facebook and checking the engagement numbers on a particular post. As consumer data begins to paint a more complete picture of customers and their context, the insights into the buying process are deeper than ever. With this clear image of your most profitable customers, you can personalize which ads are served to which customers (depending on their place in the buying process).

How effective is digital advertising?

Digital advertising’s effectiveness obviously varies, but it makes optimizing your marketing and advertising efforts easier. Because the platform is so measurable, the most effective campaigns can be expanded and other campaigns can be stopped to maximize ROIs. By using the best available types of digital ads, as recommended by IAB, you will see twice the interaction rates.

Digital Advertising Pros and Cons

While this isn’t an exhaustive list, these are some of the most important factors you should consider.

PROS:

• With endless advertising options, solutions are more flexible to factors like budgets and technical capabilities.
• Customer interaction possibilities are endless. Every screen is a possible place to advertise your brand.
• Digital campaigns are extremely scalable. Your message can be spread worldwide in an instant.
• Your campaign’s effectiveness can be measured and reported immediately. Less effective campaigns or ads can be reworked and improved instantly.
• Digital advertising can improve your brand’s reputation and trust. This makes other advertising and marketing efforts more effective.

CONS:

• While reach may be high, as the digital ad space becomes more saturated, engagement may fall. You can combat this change by focusing on targeting the correct customers. Another way to improve engagement is to verify and check your traffic and inventory. AdBistro works with Integral Ads, comScore and AdVerify to make sure its traffic is high quality and provides results for its clients.
• Blindly placing your ads online can open your brand up to negative associations. If your ad is published on a website that conflicts with your brand’s message it can harm your business. It is important to audit your advertisements to make sure they are being seen by the right people. AdBistro verifies its inventory by performing routine audits of where it publishes ads.
• Without tracking, ROIs can be lost. If you aren’t following your campaigns and adjusting them to emphasize the most effective ads, you will lose valuable results. AdBistro’s intuitive reporting interface makes it easy to monitor and adjust campaigns as necessary.