"Seasoned" marketers will be familiar with the traditional ad buying process (RFPs, negotiation, manual insertion orders, etc.). But the rise of technology has changed the way brands buy ads. "Programmatic" ad buying involves using software to purchase digital advertising, and champions of the technology cite better targeting and greater efficiency among its many benefits.

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One such champion is Daniel Bornstein, senior vice-president of media monetization and operations at Demand Media, a holding company that owns various properties, including ehow, LIVESTRONG, and CRACKED.

A former Googler, Daniel worked on the DeviantArt executive team before joining Demand Media, a company that helps brands and agencies with programmatic advertising through its D360 Platform.

I invited Daniel to Marketing Smarts to discuss programmatic advertising: what it is, why it works, and how it makes marketers' jobs easier.

Here are just a few highlights from our conversation:

"Automation" is not a dirty word (10:15): "Automation doesn't just mean commoditization. It doesn't just mean impersonal robots serving creative. We just have to put an emphasis on, to the extent that digital ads are part of an ecosystem which sustains the web which allows us all to interact with free content...[that] automation is serving a purpose...to show you creative and provide you with information that's going to make your advertising experience that much better."

Target your advertising, but not too narrowly (11:10): "It's unrealistic to assume that every advertisement that you're going to see is going to be one-hundred percent catered to you. Frankly, if it was, people would be unnerved by it because it would 'climb the wall' of personally identifiable information. You want it to be relevant, but not too relevant, from just a creepiness factor."

"Sponsored content" isn't as newfangled as it might seem: it's been around since the era of radio (20:30): "Native is really just a loaded term, because it means a couple of different things today. One...is native display, having ads match the look and feel of your page. That's just about diversifying and sort of railing against the commoditization we have from an ad unit perspective. The second...is really about sponsored content....

"This isn't something that's inherently new.... In the 1950s, when radio was a big medium, radio shows that people listened to were sponsored by companies like Ovaltine. In that sense, it's not extremely dissimilar. The studies that I've read and the people I've spoken to [indicate that] there isn't necessarily an aversion to it if it's done right." 

The future of advertising is in programmatic buying and sponsored content (26:38): "Buying media directly with an insertion order and emailing back and forth with a brand or agency...is going to become a relic of the past because it's just not efficient. I think you're going to have, on the one hand, programmatic advertising being the conduit to sort of piece together every ad impression in the larger ecosystem, and you're going to have a second bucket where digital publishers are creating sponsored content and native experiences for their consumers, and that will be much more difficult to automate."

To learn more, visit DemandMedia.com or follow the company on Twitter @DemandMedia.

Daniel and I talked about much more, so be sure to listen to the entire show, which you can do above, or download the mp3 and listen at your convenience. Of course, you can also subscribe to the Marketing Smarts podcast in iTunes or via RSS and never miss an episode!

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Music credit: Noam Weinstein.

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Published on August 3, 2016