Brands are moving 40% of their ad budgets to programmatic advertising: Ashish Shah, Vertoz

Shah, founder and CEO at Vertoz spoke of overall ad budgets & how programmatic advertising is expected to have a share of around Rs 150 crore to Rs 200 crore this IPL season

ashish shah

Not all brands get opportunity or privilege of being sponsors for these cricket events like ICC Cricket World Cup and IPL, either directly or on cricket apps, as the space for sponsors is very limited. So, for advertisers who all willing to reach cricket fans during the cricket festival, programmatic advertising is the right medium,” explains Ashish Shah, founder and CEO at Vertoz, a programmatic advertising company with international headquarters in New York.

Shah talks about how use of technology especially AI is making programmatic advertising the way forward for brands.

Excerpts: 

What is programmatic advertising? How is it different from the regular advertising we see on TV or print?

To put it in simple terms, programmatic advertising is the automated approach to the IO-based model in TV and print advertising, which involves traditional media buying and selling techniques, which involve human intervention in the form of sales meetings, discussions over phone calls, and negotiating the terms and conditions. Programmatic advertising simplifies the entire digital media buying and selling process by employing codes and algorithms to connect the advertisers to the right publishers. Thus, it fundamentally differs from the traditional methods of advertising with respect to the way it serves ads. One may say that programmatic advertising, with its automated approach and a host of other benefits associated with it, is redefining the way advertising is done.

The USP of programmatic advertising is its niche targeting capability. Programmatic advertising allows advertisers to target the right set of audience, instead of burning their precious ad dollars on unyielding impressions as traditional advertising methods do. It thereby reduces the number of wasted ad impressions and enables advertisers to channelise their budgets in a better way.

Also, through its granular reports, programmatic advertising allows brands to measure their advertising KPIs, which is difficult with traditional means like TV and Print advertising. This allows brands to measure the effectiveness of their ad campaigns and to further optimize their strategies accordingly.

Given we have IPL going on and World Cup coming up, how can programmatic advertising be used?

India’s digital population is growing by leaps and bounds. India had about 627 million in 2019 internet users, as of 2018, says a report by the Internet and Mobile Association of India (IAMAI) and Kantar IMRB. This has led to a drastic shift in the content consumption patterns of the Indian audience, who receive cricket updates through digital platforms, rather than traditional means like TV and Radio. Thus, programmatic advertising is the perfect way not only to reach this huge set of audience but also to target them precisely. This helps brands to eliminate inefficiencies and optimize their outputs.

Moreover, consumers use multiple digital devices such as smartphones, tablets, laptops, and connected TVs to watch matches and get cricket updates. Through cross-device targeting along with an omni channel approach, programmatic advertising allows brands to reach these audiences on each of these devices, thereby providing a consistent brand experience across all the devices.

It is rightly said that data is the new oil. With the help of Data Management Platforms, programmatic advertising allows brands to process and analyse the audience data from multiple digital touchpoints and deliver highly relevant ads to them, while they are glued to the game.

What is the kind of spend IPL saw in 2018 in terms of programmatic advertising? By what percentage do you see it growing this year?

The advertising spends in 2018 IPL were almost Rs 2000 crore which includes TV and Digital. This year, the industry is not expecting much increase in the spends as advertisers need to distribute their overall ad budgets for milestone events like the General Elections and the ICC World Cup. Thus, the growth rate is expected to be at 10 -15 per cent, amounting to around Rs 2300 crore. Out of this, 25-30 per cent is expected to be spent on digital mediums such as OTT's and programmatic advertising. Programmatic advertising is expected to have a share of around Rs 150 crore to Rs 200 crore.

What is the kind of investment brands are willing to put into this form of advertising? How cost effective is it when compared to traditional advertising?

Majority of brands are moving towards programmatic advertising. Some of the famous brands are moving 40-50 per cent of their overall advertising budgets on programmatic advertising.

Programmatic advertising is significantly economical and cost-effective compared to traditional advertising means. With techniques like frequency capping, advertisers can limit the number of times an ad is shown to a particular viewer, thereby limiting the ad spends. It allows advertisers to draw customer-insights based on data, increasing the effectiveness of their ad campaigns by targeting only those customers who are relevant to them. Targeting can be based on parameters such as buying patterns, browsing habits, and brand loyalty. This helps in increasing the overall efficiency by serving only relevant impressions and reduces costs.

What are the kind of brands that find this way of advertising more befitting for their brand image and message?

Programmatic advertising is suitable, rather recommended, for brands from all sectors. Its benefits like precise targeting, measurability, and automation, help brands from diverse sectors to improve the efficiency and effectiveness of their advertising campaigns. However, brands in certain sectors are known to spend more compared to other sectors. These include sectors like BFSI, E-Commerce, FMCG and Consumer Durables, Entertainment, Computing Products and Consumer Electronics, Healthcare and Pharma, Travel, Telecom and Automobile are known to spend largely in programmatic advertising.

Not all brands get opportunity or privilege of being sponsors for these cricket events like ICC Cricket World Cup and IPL, either directly or on cricket apps, as the space for sponsors is very limited. So, for advertisers who all willing to reach cricket fans during the cricket festival, programmatic advertising is the right medium.

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