Programmatic Creative vs. Dynamic Creative Optimization (DCO)
This post is continuously updated to reflect how programmatic creative and dynamic creative optimization (DCO) are evolving.
When people think of the relationship of programmatic creative vs. DCO, a common misunderstanding is that dynamic creative optimization and programmatic creative are different technologies. One is actually a subset of the other. DCO falls under the programmatic creative umbrella, but it’s not the only way to build creatives that activate the 6+ billion dollars of data in contained in programmatic media.
To illustrate this idea, let’s start with a definition of programmatic creative.
Programmatic creative refers to the set of advertising technologies that add speed, scale, and automation to the creative process. This covers both ad production and creative optimization. Programmatic media has unlocked tremendous potential in how we tell stories in paid media online, and the purpose of programmatic creative is to enable data and creativity to come together to tell brand stories in a more resonant and effective way than ever before.
The most often cited use of programmatic creative is to tailor ads to be more relevant to their audiences. Instead of showing one generalized creative to all, it is now possible to segment audiences into groups and show each group a custom creative that is more likely to impact them specifically.
Programmatic creative also enables better message testing and optimization, by both enabling the creation of multiple ads for the purpose of testing, and potentially automating the test to optimize on its own.
So at its essence, programmatic creative allows designers to quickly turn around a high volume of quality ads, match them to specific audiences, and take action based on the results. This is possible largely through computer-enabled workflows, software automation, and big data integration. Programmatic creative encompasses technologies that are fully automated as well as those which are purpose-built for programmatic media but where the operator has final control over each creative or optimization.
What Technologies Fall Under the Category of Programmatic Creative?
As we explore the technologies that solve creative problems for programmatic media, the approaches that stand out fall into two main categories: dynamic creative optimization (DCO) and creative management platforms (CMPs).
Dynamic Creative Optimization
DCO is a highly automated and rules-driven approach to advertising that actually encompasses two technologies: dynamic creative, and dynamic creative optimization.
A good metaphor to call to mind is that DCO is like an ad factory. This is where dynamic creative comes in. DCO ad units use feeds of data and a set of rules to generate hundreds or even thousands of unique creatives on the fly. The technology emerged before programmatic media took hold, originally with the purpose of dynamically retargeting shoppers with products they had viewed or left abandoned in their digital shopping carts.
While there is some variance by vendor, DCO ads typically accept the following types of data: time, device, weather, ad placement, location, and retargeting information. And while this data is readily available, it also means that the manner in which the creative is made relevant must align with one of these inputs. Additional code is required to process the data in real time, meaning DCO ads tend to be heavier overall, slowing load speeds, which can have a negative impact on viewability.
The O in DCO is for “optimization” and most DCO technologies offer automatic multi-variate testing. This testing can relate to traits like button color, ad copy, images, and offers—although these elements must be able to replace each other without requiring any adjustment to the formatting of the ad.
These automatically optimizing ad units are typically used for large direct response campaigns, where the amount of impressions that will be served justify the opportunity cost of testing so many variants, and where ROI can be clearly tracked all the way to the sale. Auto-optimizing is not a requirement in using DCO.
Setting up DCO ad units can be a complex and technical process, so careful planning is required, as is a reasonable buffer of time. Often vendors offer managed services to assist advertisers in getting their campaigns launched.
Above: DCO ad units can be configured to pull in data like product catalogues, special offers, and store information. This requires consistency in formatting of text and image assets for best results. Ad units for high impression campaigns can present multiple offers and optimize for the best combination over time.
Creative Management Platforms
Creative management platforms (CMPs) encompass the other main approach to programmatic creative. If DCO is like an ad factory, CMPs are more like design power tools, allowing designers to work on large sets of ads at the same time, but also dive in to make small changes to each individual creative.
In contrast to the complex technical nature of DCO, CMPs provide a scalable creative environment that is conducive to creativity. CMPs are focused more on enabling a designer to create and manipulate a large amount of creatives all at once, one at a time, or somewhere in between, versus focusing purely on automation. When creating many versions of a creative, there are monotonous or repetitive tasks. CMPs seek to remove as many of those as possible.
By not requiring data feed integrations or pre-programmed logic to be baked into the ad units, CMPs enable creative for any purpose, regardless of what data or audiences are being used in the targeting. File load sizes are lighter than with DCO because the ad doesn’t need additional code to build itself on the fly. This process also removes the need for heavy upfront planning or use of managed services because the toolset is closely aligned with existing design software in many respects.
Above: CMPs allow a high volume of ads to be created using a base layout. Then individual elements can be customized to suit the design as needed. This is includes modifying traits like image position, text position, and text size. Entire objects can be added or removed from individual creatives as well. This example illustrates offers created from a template with a CMP. The creatives are timely (holiday, winter) as well as tailored (by a specific designer or product type). Slight changes to each variation provide the needed polish to complete the design.
A Programmatic Creative Video Case Study
The potential uses for programmatic creative are incredibly diverse. To root these technologies firmly in reality, it may be helpful to see an example.
Below is a video case study of how the agency Anagram uses a combination of programmatic creative and programmatic media for an always-on campaign. (Disclosure: Anagram is a Thunder customer, before we rebranded and our product was called PaperG.) The video demonstrates very clearly how programmatic creative can be used to tailor the creatives to various audiences.
Programmatic Creative: Comparing CMPs and DCO
If you are evaluating programmatic creative technologies, the most important thing is to understand the problem you are trying to solve and how you want to work. We’ve touched on some of the comparison points between CMPs and DCO already, and in this section we will go into more detail.
What Skills are Required?
These emerging programmatic creative technologies can require new combinations of disciplines to operate. To incorporate data into digital advertising requires adding a bit of technical complexity into a creative production workflow that hasn’t changed fundamentally in many years.
However, it’s necessary to maintain a level of creativity and design polish in the process. Advertising, even when assisted by programmatic technologies, is a creative and visual trade after all.
Likewise, just about all programmatic creative tech will benefit from a strong grasp of how the advertiser’s target market can be segmented and what data is available for those segments. Typically demand side platforms (DSPs) and data management platforms (DMPs) will be used for programmatic targeting. Programmatic creative can be helpful with non-programmatic media as well.
That combination of creative and audience skills is enough to make use of a creative management platform. If DCO is going to be used, additional technical and coding skills are required. You must link the data feeds into the ads and set up the logic that will drive the campaign.
Trafficking and Logic Setup
To configure the automatic decisioning in DCO ad units, set up is required in two places: 1) the data source (frequently a DSP or DMP), and 2) the logic in the ad unit itself. Each input maps to an output, with rules created about what to do with the information.
Here is a plain english example of the setup of a hypothetical DCO campaign:
The DSP is configured to target audiences for the campaign that include 16 targeting line items. For each impression, the DSP will use the viewer’s real time geolocation to determine their local temperature. It will then pass that information to the ad unit.
In the DCO unit, the following logic is configured: When the temperature is below 64 degrees, show the creative with a picture of a hot coffee. Otherwise, show it with a picture of a cold smoothie.
This type of setup requires that there is a way to pass the needed information into the ad unit. This can potentially prohibit or restrict what is possible depending on what other ad tech is involved. In the event that conflicting information is passed, or data is not available for a particular impression, a “default” occurs in the DCO unit and a generic creative is served.
CMPs, on the other hand, only require the audiences to be set up on the ad server side, so their ad tags can be deployed universally. A discrete creative is produced in the CMP and provided for each segment.
Here’s a similar example for setting up a campaign with creatives from a CMP:
The DSP is configured to target 16 segments, which include audience differences like age 18-25, age 26-35, loyalty program members, indie rock listeners, pop music listeners, hip hop music listeners, etc.
Using the CMP’s streamlined workflow, 16 similar but unique creatives are produced, each with messaging and imagery tailored to matter more to that segment. If elements need to be added or removed, or if layouts need to change to accommodate a particular creative, those changes are made. Ad tags are trafficked via the DSP in each segment.
This process removes the possibility of data and decisioning conflicts, so CMPs are not capable of defaulting in the way that DCO ad units are vulnerable.
A Comparison of Mindsets
The nature of a technology tends to shape how we use it, and programmatic creative is no different.
When using DCO, the amount of knowhow and setup required makes it a better fit for organizations that carefully plan campaigns months in advance. These kinds of optimized creatives require the entire experiment to be set up before hand. While it is theoretically possible to update an in-market DCO ad, because of the complexity of the technology, these updates tend to happen only when absolutely necessary.
In contrast, the flexible nature of working with a CMP allows it to be used in a wide range of work styles. The speed at which creatives are built in a CMP makes it ideal for teams that want to adopt a more agile approach to test concepts and learn about their audience more easily. Updating in-market ads without re-trafficking is very simple. Creative optimization with a CMP is a more human-driven process. Inquisitive creatives can bring their ideas to life, see how consumers interact with them in the marketplace, and then adapt without delay.
Example Programmatic Creative Use Cases
To bring the comparison together, here are some of the more common considerations that advertisers will take into account when adopting programmatic creative.
Creative management platforms can help you if…
…You want to sustain a high bar of creativity in your programmatic creative executions
…You want to tailor your creatives based on any data, not just location, device, time, or weather
…You are looking for a way to build ads in sets of multiple sizes (300×250, 300×600, 320×50, etc) all at the same time. You would even enjoy being able to working on multiples of these sets at the same time.
…If you do want to localize your advertising, you want more customization than changing an address or city name
…You are a publisher or media company who sells somewhat similar display campaigns to a high volume of local businesses. You want a fast tool to create ads for them
DCO can help you if…
…You are operating a direct response campaign for multiple products and with millions (or billions) of impressions budgeted.
…The size of your campaign is so large that even small gains in performance will have a significant impact on your bottom line.
…You have a well-organized data feed that you want to use to build ads with, such as for product remarketing.
…The data you want to use to drive your dynamic creatives is one of the following: location, device, time, or weather
…You plan your advertising months in advance
Taking the Next Step
If you found this article useful, you can find additional information in the eBook The Essential Guide to Programmatic Creative Technologies. The book includes example campaigns, workflow explanations, and a section for frequently asked questions.
To continue your journey to transform programmatic marketing in your organization, download your free copy today.
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Programmatic Creative vs. Dynamic Creative Optimization (DCO) – Thunder Blog.