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Understanding Programmatic: Your Company and Career May Depend On It

Written by: Ryan Kelly, VP Marketing

We all face choices throughout our lives whether to hire someone or tackle a job ourselves. We might decide to paint our bedroom rather than hire a painter, or spackle the ceiling ourselves instead of calling a contractor.

The effects of such choices are not life-changing. As long as we’re happy with the job we did, the calculation is based on how much we enjoy the results and value our free time. The equation changes though when it comes to our careers. In that case, outsourcing can be shortsighted because it deprives us of gaining marketable skills and having more control over our budgets.

Related post: In-House Programmatic: Why More Brands Are Managing Advertising Themselves

This is especially true with programmatic advertising. Many marketers assume that they missed the boat on learning programmatic. As a result, they think managing programmatic campaigns consists of interfacing with an ad partner by updating insertion orders (IOs) and setting CPM targets. If this is you, you’re mistaken. Programmatic is still so new that there are really no experts. If you don’t learn it, then you’ve likely made yourself vulnerable to being replaced at some point. You’ve also missed a chance to drive more revenue for your company, which is the most straightforward way to show your value to an employer.

The power of insights

Programmatic advertising is more than a means of buying and selling ads. It’s also a vehicle for uncovering data and insights about consumers that can lead to more personalized experiences for them.

Without any data to back up your ad creative decisions, you’ll rely purely on intuition. But it’s the data from your programmatic campaigns that fuels great creative on not just display, but other marketing channels.

Imagine a men’s fashion retailer that photographed four different models, each of whom looked like one of their target personas. You could run different ads with different models across display channels to test what combinations drive the most sales for each persona. You can then take this ad creative and use it in targeted email campaigns or out-of-home advertising. These vital insights allow a brand to confidently run personalized campaigns at scale.

If you don’t learn programmatic, then you’ve likely made yourself vulnerable to being replaced at some point. You’ve also missed a chance to drive more revenue for your company, which is the most straightforward way to show your value to an employer.

If you work with a third party whose methods of executing programmatic buys are unknown to you, then you’ll never be aware of such data. Most likely your agency won’t be aware of it either because their payment is based on media buys, not delivering insights.

To be more hands-on with programmatic, you need to understand it. The reality is that many people in advertising don’t. A 2016 survey from Amobee, for instance, found that only 11% of small agency creatives said they were confident they understood programmatic advertising. A Forrester survey from 2014 found that only a quarter of marketers at the time said they understood programmatic buying well enough to use it.

There’s little evidence that this has changed, so there’s a great opportunity here for marketers that could be lost. Analysts predict that by 2020, knowledge of programmatic and data skills will be in even greater demand. The talent pool for programmatic is pretty limited and you’ll stand out from the crowd if you truly understand it.

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The good news is that programmatic is so new that there are few experts. If you get past the industry jargon — which can be like learning a new language — many programmatic concepts aren’t that hard to understand. Ultimately, programmatic consists of buyers on one side, sellers on the other and brokers in the middle. If you’re looking to get up to speed quickly, here are some concepts to master:

  • The real-time bidding process. Understand and be able to explain what happens in the 200 milliseconds it takes an ad to get placed after a user visits a website.
  • How programmatic creative and a product feed work together.
  • Understand the landscape of programmatic — ad exhanges, ad networks, publishers. How they interact and how they make money.
  • Understand header bidding.
  • Know what a DMP is.
  • Be able to explain the difference between a first-price and second-price auction.
  • Know what incremental revenue means.
  • Understand holdout audiences and why someone would use them.
  • Understand how cookie-tracking works for the web and SDKs are used for tracking on mobile.

Time to DIY

As more brands look to move their programmatic in house, being a liaison to a third-party programmatic agency doesn’t offer great job security. But being knowledgeable about programmatic does, especially if you’re able to determine if your agency has been ripping you off, as saving money is just as important as making it.

Related post: To Build or to Buy? That Is the Question for Programmatic Advertisers

That’s why it’s time to rethink outsourcing programmatic and grasp it instead. Take for example Unilever, Netflix, P&G and Allstate. These are major brands that have entire teams solely focused on programmatic.

If you spend the time to figure out the basics — perhaps the amount of time it takes to paint a room and spackle a ceiling — then you’ll have made a major investment in your career and your company will be better off because of it.

version of this article originally appeared on Forbes.

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