Dynamic Creative Optimization: The Future Of Display Advertising

No two people are the same, and neither are their shopping preferences. Dynamic creative optimization (or DCO) is the key to delivering a unique experience that is tailored to your prospective customers needs. While this term might sound foreign to some, it is nothing but technology that enables personalization of ads on a large scale.

Personalization is one of the most important factors in display advertising today, and this feature has seen immense growth over the past few years. Wouldn’t you agree that it is a much more fulfilling experience when you get to see relevant ads versus bland or generic ads that are of no interest to you? The technology that makes this possible has evolved drastically, and we are at a point in time where it is absolutely necessary to deliver such an experience, not just for the satisfaction of your customers but also to increase your conversion rate.

In order to get a better understanding of the personalization process in display advertising and delivering an awesome experience to customers, let us understand the technology behind dynamic creative optimization, and why it needs to be included in your digital marketing strategy.

What is Dynamic Creative Optimization?

Dynamic creative optimization is a form of programmatic advertising that enables ads to be updated in real-time. This involves the integration of graphic elements with customer data such as products previously seen, clicks, geographic location, etc. The technology behind DCO collects and sends this personalized data to various creative elements, which in turn display an output that targets consumers effectively. 

While graphic components are pre-defined during campaign set up, many other elements are updated in real time, right before the ad is served to the user. In other words, DCO uses programmatic means to create real-time ad campaigns.

DCO goes beyond simply infusing personalized data in generic creatives. This technology uses AI and machine learning techniques to also select the most relevant components or variants of ads to show users in real-time.

Pretty magical, right? Here’s the best part: since dynamic ads are significantly more relevant, they lead to 30-50% higher conversion rates than static ads. The goal of such technology is to optimize your banner ads by infusing them with real-time data, analytics, and testing in order to improve your click through rate and conversions.

How Does Dynamic Creative Optimization Work? 

Imagine that a user visits your website for the first time. You do not have any information about this person or their preferences. That being said, chances are they might have some vague interest in the content on the website which is why they clicked on it in the first place. 

Now imagine you gather other information about the consumer just by observing their behaviour. Which part of the screen does their mouse hover on? What is their viewing history? Which pages do they circle back to? Where they are geographically located?

DCO uses this information and sends it to creative elements of the website so that a personalized experience can be curated based on such parameters. Based on this information, a custom creative is generated which satisfies the user since it is hyper-relevant and captures their attention.

For example, suppose someone is in bed, scrolling through a food delivery website – through DCO the website knows it is currently 9AM in the morning so a breakfast ad is served (pun intended.)

There are two components to DCO:

Dynamic Units

Dynamic units in creative advertising are data-based and controlled by algorithms. These components consist of data-fed elements and offer great opportunities for engaging designs and creative optimization. Dynamic units can be set up without any technical knowledge or coding experience.

Static Units

A static unit is essentially a “shell” that is built according to a viewer. It is a single DCO powered unit that uses data to select which creative variant to show a user. Static units are much less efficient and take more time to prepare.

Whats the difference between DCO and a Creative Management Platform? 

A creative management platform or CMP is a cloud based software that helps marketers create as well as measure the impact of their digital ads and banners. It is a complete production unit for brands which enables a large volume of creatives to be produced that are brand compliant. 

In other words, creative management platforms are programmatic creative technology solutions that cover “dynamic creatives” within their broad spectrum of offerings. Creative management platforms help you set up guidelines, infusion of data feeds and generation of creative assets that are required for DCO to function.

How does a DCO work with a creative management platform? Let us break it down into simple to understand steps:

Step 1: A viewer matching target audience profile visits a website.

Step 2: The website’s ad inventory is then auctioned. The highest bid DSP wins the impression.

Step 3: An ad tag belonging to the DCO campaign is served.

Step 4: The DCO ad is then requested by a viewer’s browser.

Step 5: A dynamic message from the campaign feed is shown based on the audience’s data from the DMP and the brand’s performance.

Step 6: Messages are injected within the DCO ad based on insights

Step 7: The messages are collected by a creative management platform. The platform then injects dynamic content like images, text fields, buttons, videos inside the ad.

Step 8: Voila! The viewer is now seeing a personalized DCO advertisement that is tailored specifically for them.

When a creative management platform is used, dynamic ad generation is substantially improved. Guidelines can be implemented and flexibility is increased, along with other benefits such as improving creative design elements.

A combination of creative automation platforms and dynamic creative optimization means that ads are data driven while still being creative, leading to impactful ads that actually convert on a high rate. Isn’t that every marketers ultimate goal?

Why should you implement Dynamic Creative Optimization?

An unprecedented degree of personalization

One of the biggest draws of DCO is its ability to take personalization of ads to a whole new level. Since the number of data points used in delivering an ad is huge, it helps in creating hyper-relevant ads. For example, if there are two users browsing cell phones of a particular company, even within the same price range they might value different features from one another. For example, battery life might be a high priority for one while configurability and speed might be a high priority for the other. DCO has the ability to identify such specific interests and serve a relevant ad which is key to unlocking greater click through rates and ultimately, conversions. 

Complete Automation 

DCO falls under the umbrella of creative automation technology, which means that it does not require any manual monitoring (although analysis can be done if and when required.) This saves up valuable time and manpower that can be allocated to other tasks.

Since the technology is self reliant in gathering information and delivering relevant creatives, it even helps your team draw meaningful insights from consumer behaviour which can be further used in other aspects of your marketing campaigns. 

Programmable set of guidelines

To give marketing teams an even greater degree of control over their marketing campaigns, custom guidelines can be configured according to goals. For example, a rule can be set up as follows: “If the click-through rate of X ad variant falls below Y% threshold over a period of Z days, it will no longer be displayed for the rest of the campaign.”

Immediate benefit in conversions

DCO enables your team to expedite the ad creation process itself, thanks to dynamic and real-time ad variant generation. This decreases turnaround time and empowers you to deploy ads quicker. Apart from this, you are essentially creating customized ads for every single user without investing a disproportionate amount of resources. The value addition you are offering to consumers requires minimal effort but makes a big difference, and this maximises your revenue potential.

Essential for creating product retargeting ads

DCO is used for creating product retargeting ads. The content is created based on various behavioural aspects of the viewers. These include their website browsing history, the products viewed, purchased or added to a shopping cart. 

Conclusion

Embracing DCO is important for businesses that want to improve profitability and drive growth because it offers a level of personalization which cannot be matched by other means. A creative management platform like Rocketium makes it easy for in-house marketing teams to implement dynamic creative optimization and get the results they desire.