Aurora Magazine

Promoting excellence in advertising

Understanding Programmatic Advertising

Published in Sep-Oct 2016
Interview with Saad Siddique, CEO, Advertyze Networks.

AMBER ARSHAD: When was Advertyze Networks launched and what were its objectives?
SAAD SIDDIQUI: Advertyze Networks is a digital media advertising company launched in 2015. In 2003-04, I had launched an ecommerce website called desimithai.com aimed at connecting various local sweet shops with their customers. The website attracted a few digital ads, which is when I realised that digital advertising could be a good source of revenue. In 2006 I enrolled at NED University and couldn’t pursue the idea. However, when I completed my education in 2009, I started a company called Softech and also started conceptualising and working on building a display ad network which would involve collecting user data and working on complex algorithms that could use that data to facilitate targeted advertising. In 2015, I felt we had gathered enough data to launch an ad network and that was when I launched Advertyze in Karachi and in the UAE.

AA: What are display ad networks and in what way is Advertyze’s ad network different from Google Display Network (GDN)?
SS: A display ad network is a digital advertising solution provided by a company. The ad network serves as a middle man between advertisers and publishers. Brands and publishers register on an ad network; the brands (directly or via their agencies) then upload their ads on the network, specify the target market they wish the ad to be shown to and purchase the ad space in bulk. Publishers, for their part, specify the ad sizes and positions available on their websites. GDN is the most widely used ad network in the world; it has been in the market for almost 15 years. What we do differently is we bring engagement (by providing the option to share display ads on a viewer’s social media account) – increasing GDN’s average click through rate (CTR) of 0.2% to 2.5%. We also have a better understanding of the local market.

AA: You also provide programmatic advertising solutions. How does this work?
SS: Programmatic advertising is a very significant development in the advertiser-publisher ecosystem. As opposed to ad space bulk buying, with programmatic buying advertisers can specify the audience for each ad to the most granular level; by income, browser used, gender, age, interests and preferences. So instead of wasting ad impressions, the ad is shown to a highly targeted audience. Another aspect of programmatic is real-time bidding (RTB), which allows an ad network to bid on behalf of a brand for a particular ad slot that will be seen by the brand’s highly targeted user. When a page loads during a user visit, thousands of bids are made by brands to serve an ad to those specific users – but bear in mind that the entire process is automated and takes place within less than 200 milliseconds! As a result, more and more ads are sold on a single-impression basis, as opposed to in bulk purchases.

AA: How do you access such specific user data?
SS: Since 2011, we have been working with different websites and collecting their users’ non-personal identifiable data (PID); we also work in partnership with various ecommerce and infotainment websites such as Homeshopping, Daraz, Style.pk etc. Let me define a scenario. A user launches his/her internet browser, visits Style.pk and browses through the women’s fashion section, then hops over to Homeshopping.pk and checks out the perfumes section or another women-oriented product. All this user activity and behaviour is stored in cookies on the user’s browser, which each website has access to. The info we get from the cookies is run through various algorithms from which we conclude the gender, income bracket, general location and interests of the user.

AA: Isn’t there a privacy invasion issue?
SS: No, because we only collect non-PID information. We will not have your exact location, your name, exact income, confidential credentials such as passwords, etc. Every user is a ‘number’ for us, and a string to be used in the algorithm. We are only enhancing the user experience through targeted ads, based on the calculations we have done.

AA: What are some of the clear advantages of programmatic?
SS: Firstly, you can specify the audience and even the ‘air time’ of every ad. Secondly, you can monitor campaign results. You can gauge which ads do best with which audiences and then, if need be, alter your target audience, even mid-campaign. Brands can make multiple ads, targeting multiple audiences and spend more on audiences that respond the best. You cannot do this with TV or OOH.

AA: Do you have trouble convincing brands to take on programmatic?
SS: It’s a new thing; brands are used to traditional marketing methods, so convincing them to explore programmatic is a challenge. However, they are gradually realising the potential of programmatic. The bigger challenge is to convince them to move away from the giant that is Google and give us a chance.

AA: What about the cost of digital marketing in general, and programmatic in particular, and how does it compare with traditional?
SS: In programmatic, the more specific the audience the higher the cost, although the impressions and clicks will also be higher, or in other words, the ROI will be higher. If used effectively, the cost of digital compared with traditional is exponentially lower. Let me give you an example of a textile brand. In 2013, they were spending about 40 million rupees for 20 days on OOH. We asked them to give us the budget equivalent to just one billboard and to check out the results of their digital campaign. In 2015, that brand is not doing any OOH marketing – they are spending only on digital and achieving excellent results.

AA: How will programmatic affect traditional advertising?
SS: In 2013, only six percent of media planners spent more than 50% of their digital budget on programmatic. In 2015, this has increased to more than 65%. So, in 2015 more than 65% of these planners spent over 50% of their budget on programmatic. I think in the next three years, once complete data is collected, almost 100% of the ads will go on programmatic. Right now, the overall digital spend is less than five percent, but in a few years we will see a growth of 20 to 25%. The global market has shifted about 60% of ad budget to digital.

AA: Has there been a decline in display advertising now that Facebook has become so big?
SS: No. Although Facebook does account for a major chunk of the audiences, people still go to various websites. We have more than 500 million impressions this month; people are visiting drama websites, news websites, and ecommerce websites such as OLX, PakWheels, Daraz, etc, have seen tremendous growth.

AA: Are there technological challenges in implementing programmatic in Pakistan?
SS: Ironically, technology itself is the biggest technological barrier. Initially, we didn’t have the language expertise required to implement programmatic. Also, technologies change very rapidly. The idea we originally conceived had to be altered due to changes in the digital landscape. It is essential to keep up with every single development in technology, and that means investing in very good resources.

AA: What is the biggest mistake a brand can make on digital?
SS: The true benefit of digital is that you can totally zero in on your customers – if you are not doing that you are wasting money. Targeting and tracking are the selling points of digital. Brands and agencies need to study programmatic more, check out the benefits and then venture into it. Once a brand realises the power of digital media and programmatic, everything will change.

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