The Evolution of Programmatic Advertising: 5 Trends Shaping the Future

Key takeaways

1)???? As third-party cookies are phased out and worries about data transparency grow, programmatic advertisements will embrace privacy-centric solutions.

2)???? More stricter safeguards will be used to prevent ad fraud, which has become a major concern in programmatic advertising.

3)???? AI and machine learning are also having an influence on the area, providing opportunities for better customisation and real-time optimisation.

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Programmatic advertising is incredibly efficient; by automating the purchase and selling of ad inventory, advertisers may deliver relevant adverts to internet consumers in under a second. The predominance of programmatic advertising has been consistent over the previous 15 to 20 years, adapting and evolving in response to changes in consumer behaviour and technical improvements.

2024 will not be any different. With the near-death of the third-party cookie and unexpected advances in AI, the sector of programmatic advertising is poised for its next stage.

This blog will look at five ways that programmatic advertising is likely to alter in the next few years, so you know what to anticipate.

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1.?? Putting privacy at the forefront

Programmatic advertising needs massive volumes of data. Historically, it depended extensively on third-party cookies to track user activity around the web. This tracking allowed marketers to generate complete user profiles and provide highly targeted advertisements. However, as consumers became more aware of how their information was gathered and utilised, privacy concerns grew.

Programmatic advertising has been at the focus of these privacy controversies due to its reliance on third-party cookies, which monitor users across several websites without their explicit authorization. This technique has, of course, generated concerns and prompted a drive for more privacy safeguards.

In response, the advertising business is shifting and creating more privacy-focused strategies. Google’s plan to phase out third-party cookies in its Chrome browser by 2024 is a significant shift, requiring marketers to explore alternate means of targeting and monitoring.

Given these developments, organisations that employ programmatic advertising will need to rethink how they use data to support their strategy. Contextual advertising (which targets adverts based on webpage content rather than user activity) and the development of Privacy Sandbox (a collection of privacy-preserving advertising APIs) are gaining popularity.

Furthermore, first-party data (information obtained directly from consumers with their consent) is becoming increasingly important. Businesses should strive to collect this data responsibly because it is a highly transparent method of operation.

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2.?? Increased spend on TV ads

When smart TVs introduced a new outlet for programmatic advertisements in the mid-2010s, marketers seized the chance. In 2024, US programmatic ad expenditure is expected to reach $24 billion. This increase can be ascribed to the ongoing reduction in traditional TV viewing and the advent of streaming services. Consumers are increasingly using services such as Netflix, Prime Video, and YouTube, all of which provide advertisers with CTV (connected television) advertising chances.

CTV advertising provides more exact audience targeting and extensive statistics than traditional television commercials. This accuracy enables marketers to segment audiences based on interests, demographics, and watching behaviours, resulting in increased engagement and conversion rates. CTV advertising' interactive features, including clickable components, improve ad campaign efficacy by allowing for direct customer engagements.

In response to shifting media consumption patterns and the greater effectiveness of their CTV advertisements, we may expect more firms to invest in programmatic TV ads in 2024.

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3.?? Lower tolerance for ad fraud

Ad fraud has been a recurring problem in the world of programmatic advertising, costing the business billions of dollars each year. According to reports, fraudulent activities such as bogus impressions, clicks and installations can cost up to 40-50% of programmatic ad expenditure. This not only raises advertising expenditures, but also skews campaign effectiveness data, resulting in incorrect marketing tactics.

Fraudsters use advanced tactics such as SDK spoofing and ad stacking to boost impressions. These practices cause substantial financial losses and undermine confidence in digital advertising.

To tackle ad fraud, the industry is using more effective detection and prevention tools. In 2024, efforts will be focused on increasing openness and instituting stronger verification methods. Solutions include using artificial intelligence and machine learning to detect fraudulent trends in real time, as well as using third-party verification services to assure the accuracy of ad placements.

Companies can use dynamic blocklists to prevent advertisements from appearing on known fraudulent websites. Combined with educating stakeholders on the hazards and warning signals of ad fraud, we may see less of it in the future years.

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4.?? Refining advertising strategies with AI

Artificial intelligence developments appear to be revolutionising everything, including programmatic advertising.

AI provides several opportunities to improve efficiency, targeting, and customisation. In 2024, we may expect to see these improvements in action, with businesses leveraging AI's ability to handle massive volumes of data and learn in real time. Here are some instances.

o?? Dynamic creative optimisation (DCO): advanced machine learning algorithms are always learning from new data, adjusting to market trends and customer behaviours to choose the most successful advertising. Keeping advertising relevant to target demographics improves engagement and conversion rates.

o?? Improving ad targeting precision: by assessing non-intrusive data points such as search behaviour and browsing history, AI may forecast user preferences while protecting individual privacy. Refined targeting is vital in a post-cookie environment, when user privacy is expected rather than preferred.

o?? Real-time bidding efficiency: this enables marketers to make faster, more educated bidding decisions based on extensive data research. This feature optimises ad budget and enhances the likelihood of reaching the intended audience at the appropriate moment.

Businesses who want to include AI into their programmatic advertising campaigns must take several steps. First and foremost, the proper instruments are required. Businesses may improve their programmatic advertising operations by investing in networks like Google Display Network or The Trade Desk that include AI/automation technology.

Next, businesses must guarantee that their data is mature enough to enable AI activities. Collecting and analysing large amounts of high-quality data is crucial for important insights. To preserve money and campaign integrity, establish strict verification and anti-fraud methods as AI may intensify ad fraud.

AI has the potential to significantly enhance advertising outcomes, but you should consider the obstacles and needs before embracing this trend.

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5.?? Engaging consumers across multiple platforms

Modern customers want easy and consistent experiences. They're also more likely to recall your brand if they see your commercials across many channels. An omnichannel approach helps ensure success by engaging people across various touchpoints.

We should expect to see more of this in 2024, with corporations employing programmatic advertising across many media. AI and machine learning make it simpler to examine client data and tailor experiences across several channels. Customer Data Platforms (CDPs) and other advanced data management solutions can allow firms to consolidate data from several sources, delivering a more complete picture of the customer and improving personalisation efforts.

Businesses who use these technologies to establish an omnichannel approach will gain significantly, including a 30% increase in client lifetime value when compared to single-channel methods.?

Because audio material is so popular, you might want to include some of your adverts on Spotify and podcasts. Email and SMS give more direct means of engaging prospects, offering another viable channel for multidimensional initiatives. As previously said, CTV commercials are becoming more widespread, and you may notice ads here that you also see on other platforms.

Of course, social media is a dependable advertising platform, and this trend is unlikely to change. In reality, social commerce (including platforms such as Instagram and TikTok) is? expected to generate $2.9 trillion in revenue by 2026.

For firms looking to fully diversify, there is also 'voice commerce' and AR/VR experiences. Voice-activated devices and augmented reality enable marketers to build immersive advertising experiences that connect digital and physical interactions.

Businesses looking to implement an omnichannel strategy in 2024 should use AI for customisation. AI and machine learning improve not just targeting but also the total consumer experience by making it more relevant and interesting.

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Final thoughts

As we enter uncharted territory with programmatic advertising in 2024, it is evident that adaptation and innovation are critical to keeping ahead. Embracing new technology, developing omnichannel strategy, and prioritising privacy are not merely trends; they are vital actions to assure long-term engagement and success.

The future of advertising lies in building seamless, customised experiences that connect with customers across all touchpoints. Businesses may meet and even exceed customer expectations by employing advanced AI, interactive CTV commercials, and powerful technologies, paving the path for more effective advertising.

Contact purpleplanet if you need help with your marketing campaigns!

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