Below, NewProgrammatic has prepared a shortlist of the most influential BNPL industry entities that offer eliciting advertising opportunities for worldwide brands.

Try the NewProgrammatic demo to discover how to boost conversions!

What are BNPL solutions?

Interest-free installments and flexible payment options are steadily becoming more important as changing users’ preferences have evolved in favor of Fintech solutions. Since BNPL providers have significantly increased their user bases, as well as the number of offered merchants, these platforms are currently more than valuable for advertisers.

BNPLs are user-friendly solutions that shifted from the status of market trends to serious competitors of conventional financing providers like traditional banks. As the name suggests, Buy Now Pay Later offers delayed payments for shopping online, giving users time to consider whether their purchase was the right decision, and prepare for the expense.

BNPL business models vary depending on the chosen platform, but the most prolific companies offer four-installment plans that are interest-free as long as users respect payment deadlines.

Who are BNPL users?

By offering interest-free installments, Buy Now Pay Later services appeal to audiences concerned about their spending and seek chances to utilize a privacy-oriented and cheaper format of consumer credit.

The popularity of these services is most visible among younger consumers from generations Y and Z. These users, who are currently setting trends in marketing, are known for their reluctance toward conventional banking solutions, loans, and credit cards. Studies show that 67% of Millennials do not have credit cards, and more people aged 18-34 are afraid of debt than of death or war.

Ascent’s study shows all marketers the extent of increasing adoption of Buy Now, Pay Later. Their 2021 research found that 55.8% of American consumers have used some form of BNPL services, and more than half of those who have not, believe they would try it within the following 12 months.

Buy Now Pay Later marketing opportunities

With this unoverlookable Buy Now Pay Later market growth, advertisers now have access to excessive, and well-converting traffic. Brands can find purchase-oriented users through precisely-tailored Search Autocomplete and Tiles Suggestions, directly answering their queries.

NewProgrammatic offers advertisers and brands a chance to access this constantly growing volume of traffic, and present the keyword-targeted audience with the intent-matched proposal. This applies to all advertisers, and not only the ones who offer BNPL payments. Key players like Klarna aren’t promoting BNPL merchants’ offers only, as the company dreams of becoming a search engine more than a marketplace.

What does it mean for brands?

Bidding for BNPL industry traffic is something that should be present on every Digital Marketer’s agenda in 2022. There are many perks for brands in terms of increasing brand safety, competitiveness in the market, making the brand more visible to customers, and reaching a purchase-oriented audience.

Make sure to read NewProgrammatic’s blog article on Brand-Safe Buy Now Pay Later Advertising in 2022, which presents an interesting perspective on the topic.

5 things to remember about Buy Now Pay Later traffic and conversions

Buy Now Pay Later offers have a rather characteristic audience that could be shortly described as purchase-driven. The further conclusion is that these users should be more than wanted by all advertisers, as their motivation for entering BNPL platforms is to either find some interesting offers or finalize the purchase.

Below, find some of the most interesting/important aspects of engaging with BNPL audiences. These should give all marketers a clearer view as to why it is so beneficial to have their brands displayed in vastly-growing search bars.

Growing user-base

Users are what drives the BNPL industry forward, and that is why it was not until the pandemic online shopping popularity, that Buy Now Pay Later platforms’ numbers really skyrocketed.

In the US only, and we would like to remind you that this market is still catching up to Europe, Australia, and New Zealand in terms of BNPL popularity, there were 45.1 million BNPL users in 2021. This is almost a quadruple what was seen before the Covid-19 pandemic, as in 2019 there were “only” 11.6 million users in the US.

More customers and users mean that advertisers can access a wider, more diversified, and yet still purchase-driven audience.

AOV

An Average Order Value (AOV) is an important indicator of campaign success, as the higher AOV there is, the more revenue for a brand from just one conversion. The fact that BNPL solutions are most popular in richer societies – Western Europe, The United States of America, Australia, and New Zealand – means that the shopping carts are more likely to be packed.

Klarna’s study shows that some brands could increase their AOV even as much as 33% just by implementing BNPL payment options, which is definitely something worth reaching for. With the same number of orders, the brand is simply able to generate more revenue. Increasing AOV means that with the same marketing efforts and spending, the brand generates higher ROI.

Volumes

The impressive transaction volumes are also something that should speak directly to advertisers’ hearts. This is a chain reaction, as the more users access the larger number of merchants, the more impressive the overall results will be.

The conservative projections show that by 2025 the global BNPL volume will rise to $680 billion. But some experts claim that by 2024 the US market only will provide $100 billion worth of transactions.

These rising financial BNPL performances mean that brands are able to increase their sales simply by offering their services and products to bigger and richer audiences.

Merchants number

Joining BNPL solutions by new merchants and advertisers is something happening every second. Sezzle (now acquired by Zip) shared information, that their platform offered as many as 47,000 merchants at the beginning of 2022. Klarna on the other hand boasts of how their 400 thousand worldwide merchant base is constantly growing.

An increasing number of merchants does not necessarily mean that it will be much harder for brands to reach new customers. With programmatic solutions like Search Autocomplete, everybody can access keyword-targeted, relevant audiences.

The biggest and most prolific worldwide luxury attire, sports, house decor, nutrition, and food brands have already decided to jump in on the BNPL wave. It’s a brand-safe and reliable source of traffic, and therefore even the companies that dominate usual SERPs understand the value brought in by a highly-converting BNPL audience.

Top-performing GEOs

As we already signalized in the AOV section, marketers should consider buying BNPL ad space, as it reaches the audience that comes from GEOs (countries and regions) considered by the industry as Tier 1. These are developed countries with high consumer needs and the highest possibilities for brand-safe and quality advertisers.

Scandinavia is home to BNPL solutions, as the pioneer, Klarna, originates from the Swedish capital, Stockholm. Nordic countries, alongside Germany and the United Kingdom, are not only one of the most developed in the world and Europe but also some of the most prolific BNPL-spenders.

Australia and New Zealand are home to some most cutting-edge BNPL solutions providers, too. This is not an accident that these, both richer and fast-developing societies, have become keen users of BNPL offers.

There is still plenty of area for BNPL traffic to grow in the United States of America, as the society there is slowly but steadily getting convinced of these solutions. Industry analysis shows that the market in the United States is expected to grow by more than 66.5% in 2022.

The Asia-Pacific region should be considered a potent field for BNPL development, too, and definitely, a place offering an incredibly big consumer base. But there is more time needed for these markets to fully realize the potential held by BNPL market opportunities. The BNPL spending in Vietnam reached $40 million in 2020.

BNPL service providers overview

As the BNPL industry is constantly growing, all marketers should be aware of the buying benefits listed above. The biggest platforms that are available for users and advertisers are definitely the most competitive, but also the most rewarding places.

With often occurring changes and acquisitions, it will be best to keep track of all the BNPL industry news. Agreements and mergers open major new possibilities for advertisers that should unquestionably be capitalized on.

Klarna Bank AB

Let’s start with one of the world’s leaders in the BNPL segment – Klarna. The Stockholm-based fintech giants started operating in 2005 and over almost two decades impressively expanded their global reach.

According to an official financial report published by the company, in 2021 Klarna dominated the market and managed to connect its consumers with more than 400 thousand retailers from all around the globe. Their merchandise volumes jumped to $80 billion from $53 billion in 2020 and $35 billion in 2019. That means that YoY the company noted around 151% volume growth, which only showcases how much trust they get from users, and how much need there is for the BNPL services.

Besides offering up to 4 interest-free installments, Klarna becomes a growingly important search engine used for finding the best-fit products. Their reports reveal that the solution managed to attract 147 million users from all around the world, and major brands like Nike, H & M Hennes & Mauritz AB, or ASOS are only some examples of brands that are present there.

PayPal in 4

As one of the biggest alternatives to traditional banking in terms of online payments, PayPal decided to offer a BNPL service to their 426 million customers. PayPal in 4 offers split payments to everyone who wants to use PayPal at checkout: 25% of the total price will be deducted from users’ accounts right away, and another 3 equal installments are due every 2 weeks.

The fact that payments could be controlled via the widely-owned PayPal app, and that the service is secured the same way that every PayPal transaction is, lures in millions of customers. By introducing the BNPL offer, PayPal immediately reached for a big Buy Now Pay Later market share, granting all of its users’ access to the service.

Thanks to that, over 400 million users have been granted access to BNPL payments available on all the websites that offer standard PayPal transactions. This should not be surprising that the service stormed the market, and according to C+R Research, PayPal is the most used BNPL provider (used by 57% of retailers) in the world.

We saw a 400% year-on-year rise in our volumes going through ‘buy now, pay later’ this past Black Friday [2021]. It’s booming right now. We had more than 1 million first-time users for the first time ever in the month of November.

Dan Schulman, the CEO of PayPal

Zip (previously QuadPay)

Australian BNPL giants Zip have completed the acquisition of US-based QuadPay service in Q3 2020, and a year later started merging the two brands together. While Zip is mostly focused on Australian traffic, QuadPay was one of the most prominent brands in the United States, and the merger enabled both companies to vastly expand their worldwide reach.

Zip is currently operating in 12 markets, and its 2021 annual report shows a 147% increase in revenue ($397.5 million), 176% transaction volume increase ($5.8 billion), and 248% customer number increase (7.3 million). A major part of this growth was possible by acquiring new partners including Sezzle, Spotii, Twisto, TendoPay, and Payflex.

QuadPay allows users to have their payments broken into four interest-free installments that could be paid off during a 6 weeks-long period. Zip, previously QuadPay, is used by some world-renowned brands to promote their products and services, and among those are the likes of Gamestop, Target, Airbnb, Booking, and Nike.

Afterpay

The Australian company offers a BNPL solution that has been branded as the most suitable for students thanks to its smart credit limits. The payments are split into four parts, and the user is required to pay the first 25% of the price immediately. The following three payments are due every two weeks.

The company managed to start cooperation with Google Pay in 2020 when it started providing the giant’s users with the possibility to use Buy Now, Pay Later model while shopping with Google Pay. This opens up whole new traffic possibilities for brands that want to be advertising on the BNPL platforms.

In June 2021, the Afterpay platform had now 16 million users and was cooperating with more than 85 thousand brands in Australia, New Zealand, Canada, the US, and the UK. Among those, users can find some renowned and well-established brands like Pandora, Crocs, Urban Outfitters, Adidas, Dr. Martens, and many more.

Affirm

Affirm’s services allow users to shop in their favorite places, both online and in-store with the possibility of paying back in 4 installment-free parts. The company’s Q4 report shows the quick growth that allows brands to have access to a wider range of Affirm’s impressions:

• Affirm claimed that their active merchants’ number grew to 29,000, which is a 412% increase. This happened also thanks to the company’s integration with vastly-growing Shopify.
• The active customer base grew by 97% and exceeded 7 million.
• There was an 8% growth in the number of transactions per average active user.

Affirm is a San Francisco-based company, and up until 2021, it operated on the market in the US only. In Q4 2021 it expanded to Australia, and even before that it announced an Amazon partnership for BNPL payments of $50 and more.

Laybuy

Laybuy Group Holdings Limited has a BNPL platform that is gaining immense popularity in New Zealand and Australia, both being growingly important Buy Now Pay Later markets. Kiwi-originated service was also introduced to the United Kingdom, with Gross Merchandise Value (GMV) there reaching a 38% YoY increase. For New Zealand and Australia, Laybuy has registered a 25% YoY GMV increase for January and February 2022.

As for the active user base, Laybuy is closing to a big milestone of 1 million. There are also over 13,400 merchants available for these audiences, and on a quarterly basis, both of these numbers rise. A projected 43-48% revenue increase in the 2022 forecast period explains perfectly why Laybuy has ambitions of entering more markets and challenging bigger competitors.

Compared to most major BNPL platforms, Laybuy offers a quite favorable installment payments model, where expenses are split into six weekly parts. Laybuy automatically charges the credit card submitted by the user.

Apple Pay Later

Although Apple has not released any final version of its BNPL product, it has been almost official that this kind of service will sooner or later become available for Apple Pay users. Especially since Apple Pay services are used on an everyday basis by over 500 million users, this could potentially be a game-changer for the Buy Now Pay Later industry.

The market impatiently awaits more news on that matter, as entering media buying opportunities with Apple BNPL services should be a viable option for all advertisers. But for now, we’re only suggesting preparing for the right moment.

How to start advertising on the BNPL provider platform?

In order to fully embrace the Buy Now Pay Later media buying opportunities, marketers will need a programmatic tool that helps them set up campaigns and access the highly motivated audience. NewProgrammatic solutions include smooth and user-friendly suggestions delivered via keyword-based Search Autocomplete functionality and Programmatic Tiles.

With these automated solutions, an advertiser is able to target a specific audience and reach it at the exact moment they require a recommendation as to where to finalize their purchases. All this without any privacy-violating third party data processing. The BNPL advertising with NewProgrammatic is based on intent-targeting, as it proves to be far more efficient than typical demographic targeting.

See how to increase sales, AOV, and brand visibility.
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The post Buy Now Pay Later marketing in 2022. Brands and market overview appeared first on NewProgrammatic Blog.

A few years ago it would be considered by many a wishful thinking, but today it’s just as simple as ever.

The first BNPL platforms emerged in 2005, but only in the last few years have they become quite important for the e-commerce industry. Naturally, where’s demand, the supply follows, hence top brands decided to quickly follow the new buying model and, of course, capitalize on it.

And those looking to capitalize on programmatic media buying can now benefit from the BNPL hype as well.

In this article, we’re taking a closer look at how brand-safe programmatic advertising solutions can help your business get more exposure with BNPL platforms… even if you’re not there.

BNPL 101. What are the Buy Now, Pay Later platforms?

In order to fully embrace the potential that is being offered by BNPL platforms, every marketer needs to understand the mechanisms behind it. These platforms are solutions that allow customers to make purchases without the need to pay for them right away at checkout. In fact, BNPL gives users the possibility to have their orders shipped right after the transaction and pay the money back to the platform in full or in accordance with installment plans.

Although the Buy Now Pay Later model of payment could resemble a standard bank loan format, it is not associated with it, nor a credit card balance. What needs to be widely understood, is that the best BNPL solutions are mostly free of interest, and offer the highest extent of Fintech-driven safety for all parties. No steps include a major financial institution or a bank. And in most cases, interests, too. In 2022, fintech solutions are much more welcome and will only keep on changing the retail industry as we know it today.

How can a brand benefit from BNPL advertising?

An insightful marketer should understand how to use the characteristics of the BNPL audience in order to elevate sales, and earnings, accordingly. The industry has already learned how to tame programmatic advertising possibilities, and use those to win specifically targeted ad impressions. With BNPL it has become possible to precisely find an already purchase-driven audience that does not require convincing to spend money. What it needs is a suggestion on where to do so, and shoppers will gladly accept accurate recommendations.

For example, NewProgrammatic allows advertisers to access the BNPL media buying model, offering advertising solutions that make this process intuitive and efficiently presenting users with subtle, but really helpful keyword-based ads even before their query is fully typed in.

Buy Now Pay Later advertising is not for BNPL transactions only

Although Buy Now Pay Later offers are core to the BNPL platforms’ operations, they are not a necessity for a brand offered there. This should be remembered by advertisers and brands – a company does not need to have a Buy Now, Pay Later system implemented in order to be displayed on the effective BNPL traffic sources.

Like in the example we gave above, while creating a programmatic campaign, brands are able to use the precise BNPL targeting and reach the highly-converting users without exactly offering Buy Now Pay Later transactions. This way they are able to fully capitalize on audience preferences, have access to a purchase-driven user base and advertise in a brand-safe and respected environment.

Intent-based targeting boosts conversions

Marketers from all niches are highly aware of the fact that their brands’ performance will improve once their marketing efforts are correctly targeted. And although the traditional, demographic-based marketing approach has been a go-to strategy for a long time, it has been proven to be less effective than finding the right, highly-converting audience based on their intent.

Identifying user behaviors online and offering the ads to the people who actually seek proposals in that matter has become a crucial part of modern ICP (Ideal Customer Profile) building. And with BNPL platforms it has become possible to get access to detailed profiles of people who are already looking for solutions offered by the marketer’s brand.

With that knowledge and proper programmatic campaign creation solutions, a brand is able to prioritize those purchase-driven BNPL platform users, elevating conversions, sales, and profits. In fact, a well intent targeted campaign may require a smaller budget to perform better than broader, RON-type advertising.

A higher Average Order Value

Klarna’s insights suggest that implementing BNPL could impressively increase the AOV (Average Order Value), too. For some brands, the increase of AOV could be as much as 33%. This is due to the fact that with Buy Now Pay Later’s prolonged payment period, a consumer is able to afford more products. It also elevates the sense of financial stability.

Reaching the customer at the perfect moment

Timing is a key feature of programmatic advertising, and the BNPL model allows brands to reach their target audience exactly at the moment they expect it to happen. This applies especially to the NewProgrammatic advertising solutions, as they directly answer users’ queries before they finish typing them.

As a result, marketers are able to find the best converting audience by simply reaching out to the people who are most likely to become customers as they are already purchase-oriented.

Brand visibility and becoming competitive

In order to be able to make sales, a brand needs to find a way to jostle with competitors for user engagement and attention. Increased brand visibility and tapping into your competitors’ niches are on every marketer’s agenda. And that can be easily achieved through advertising on BNPL platforms.

Brand familiarity has always been an important aspect of building a position both in local and international markets. If potential customers are aware of the brand’s existence and offer, it will be much more convenient for advertisers to present the results.

Various marketing and user-behavior studies utilizing eye-tracking technology found that internet users will more eagerly click on familiar brand names while conducting their searches. The extent to which such findings apply is quite impressive, as according to Secret Life of Search research, 82% of internet users choose familiar brands as their first-click option.

This leaves marketers of smaller, and less recognized brands with a hard nut to crack. On one hand, typical SERPs on common keywords become unavailable for them, as most often they cannot compete financially with the giants. On the other hand, building brand awareness becomes harder if users tend to focus on familiar names.

The solution could be, again, BNPL advertising, allowing brands to become visible by skipping the SERPs altogether.

It increases brand awareness and brings purchase-driven customers to the landing page. See, how NewProgrammatic could help your brand increase its reach.

User expectations for a BNPL provider

The popularity of BNPL solutions is not a coincidence, it’s a direct response to what the audience expects. This applies mostly to younger generations of consumers that are highly literate with technology and hence seek smooth user experience, tend to be very brand-oriented, and do not enjoy the thought of loans. Today’s users also value their privacy and appreciate a well-timed effort-saving suggestion. With that being said, companies that follow these trends will be able to effectively attract customers.

This enabled industry to forge a model that is beneficial for everybody. On one side, programmatic advertising on BNPL markets attracts the consumers who enjoy delayed payment opportunities, and will gladly take a suggestion as to what brands to focus on. On the other side, there are advertisers who now have access to a highly purchase-convinced brand-safe audience, which can elevate their campaign’s efficiency.

There is a structural shift going on in payments more broadly because of the changing behavior of the next generation. As the Millennials and Gen Z spend more, that will drive that spend to these more modern offerings.

Jason Orthman, Hyperion Asset Management (for Australian Financial Review).

Where are BNPL solutions most popular?

It’s safe to say that BNPL adoption is at its early stage in the USA and Europe, as Buy Now Pay Later transactions have not yet become the driving force in worldwide e-commerce. It only accounted for 1.6% of total e-commerce sales in the United States of America in 2020, but the projections suggest that it could reach 4.5% by 2024.

European markets are not homogenous in that matter, as Sweden, the UK, and Germany emerge as leaders in the BNPL e-commerce payments. This should not be surprising for the industry, as Sweden is actually home to BNPL. Klarna, the pioneer in Buy Now Pay Later services, has been founded in Stockholm. The region of Europe, just like the USA, opened up to the BNPL solutions, and reports from Q4 2021 only confirm that. According to the BNPL Survey, in Europe, the industry will expectedly grow by 54.7% in 2022.

In the breakdown of domestic e-commerce payments, right behind Scandinavian countries and Germany, are Australia and New Zealand. Once again, those are highly innovative regions in terms of Fintech and greatly developed countries in general. New Zealand and Australia together made up 20% of the global e-commerce market share in 2020.

Precise suggestions

There is a fine line between what could be perceived as intrusive advertising, and an anticipated query suggestion. Modern users expect accuracy and good timing, and providing exactly that is a way of gaining their trust.

To attract more consumers and conversions, the industry needs to focus on advertising in brand-safe conditions, where it is part of an established environment that a platform presents suggestions to its users. As those recommendations are part of a deal between a purchase-oriented audience and the BNPL solution provider, they are highly expected.

This is an effective synergy that leaves all the parties in the marketing equation satisfied. Thus, by neglecting BNPL traffic and conversions, marketers and brands repudiate trendy and highly rewarding solutions for market reach.

The reluctance toward debts

Having witnessed a financial crisis once every few years, Millennials and Gen Z representatives have developed a fear of financial instability connected with the unpredicted financial market behaviors. Younger audiences do not see loans as a solution to their needs. That is why financial liabilities with third-party companies, and not banks, are a much-appreciated opportunity for them.

According to American Psychological Association’s study, people between the ages of 18 and 34 are more scared of debt (34%) than of death (20%) and war (17%). Having been raised in relatively safe times, new customers perceive the financial trouble they witnessed watching their parents struggle with as a more perilous circumstance.

That is why more than half of Millennials (67%) do not have a credit card at all. These users need independence, but it does not change the fact that they still enjoy flexible payment options. The difference between them and their parents and grandparents is that Millennials and Gen Z require more transparency and security.

The modern way to do it is to use buy-now-pay-later. It’s consumer-friendly. It’s not unfair. It doesn’t have any fees. It’s really transparent. It’s often mobile and digitally available for online shopping.

David Sandström, Klarna’s Chief Marketing Officer (for Verdict.co).

Covid-struck e-commerce market

There is no doubt that Covid-19 has heavily changed the way consumers, brands, and marketers need to operate on the market. With people losing jobs, and brands seeking major savings, both sides of a previously well-cemented system needed to adjust to the new reality.

The first thing that most consumers did when the pandemic broke out, was to suspend all extra spending. In times of uncertainty, BNPL platforms provided exactly that – a possibility to save money while not being forced to postpone shopping.

The statistics show that perfectly. Adobe conducted e-commerce-focused research that highlighted how Buy Now Pay Later platforms grew 215% YoY in the first two months of 2021. Moreover, BNPL service providers have noticed that customers are placing orders 18% larger on average.

This directly benefits the brands, as by offering their products and services on BNPL platforms they are able to elevate sales, capitalizing on user behaviors. But advertisers should bear in mind that 65% of BNPL transactions include payments of less than $500. 

Credit Karma’s 2021 research shows that as much as one-third of BNPL purchases (32% of those) are for $100 and less. Younger audiences, Millennials, and Gen Z, mostly use BNPL for more frequent, but less valuable acquisitions. Big-ticket item purchases worth $3,000 or more are more common among Gen X and Boomers(+). Respectively, 11% and 17% of these users have used BNPL solutions for purchases of $3,000 or more. 

First-party data security

Another result of having younger generations create market trends is a major focus that has to be put on user privacy. Third-party data trading is not welcome anymore, as audiences are highly alert to what happens with their information. This transmits to how modern programmatic advertising needs to be conducted, and this is where NewProgrammatic and BNPL platforms come in handy.

This combination offers safe, yet precise penetration of the highest-tier audience without any need for third-party data processing. Users consciously agree to Buy Now Pay Later platforms for processing their data so that ads are precise and well-tailored.

The BNPL platforms do not inform advertisers about user profiles, and therefore protect the audience’s data. NewProgrammatic ads are keyword-based. This means that in a split second when the user is typing their query, a precise ad is being matched to them.

For more information about Cookieless advertising for a cookieless world, we recommend reading NewProgrammatic article on the topic.

What major BNPL brands should advertisers pay attention to?

The BNPL segment of e-commerce has been constantly growing due to user preferences, market changes, and an increased interest in safer, cookieless solutions. That is how the industry has been able to attract new business partners and widen its user base, offering even more traffic to the advertisers.

Due to the fact that volumes and conversions are crucial in process of advertising, all brands should get well accustomed to the most popular BNPL solutions. Mainstream companies offer, in fact, the widest possibilities, and really valuable traffic.

The below set of most popular brands in the BNPL industry is a great starting point for all advertisers who seek to explore these possibilities.

• Klarna
• Zip (previously QuadPay)
• Afterpay
• Affirm
• Laybuy
• PayPal

Conclusions

With the pace of development in the BNPL niche and the new possibilities that this segment offers to the advertisers, there is no reason why any marketing specialist should ignore BNPL traffic. And the future seems to be looking really bright for these fintech services, as more customers, especially from younger audiences, trust leading BNPL solutions.

More than certainly, brands in 2022 should not be forgetting about entering the BNPL advertising for all the opportunities:

• Advertising on a cookieless basis without any third-party data nonconsensual processing
• Becoming fully compliant with modern user preferences for online shopping
• Offering well-timed and contextually relevant advertising
• Reaching purchase-oriented audience
• Effective competition against other brands
• Increasing brand awareness and conversions at once
• Embracing the brand-safe advertising

Does your brand want to elevate the sales and increase its visibility?
Check out the NewProgrammatic demo!

The post Brand-Safe Buy Now Pay Later Advertising in 2022 appeared first on NewProgrammatic Blog.

As the Internet grew and user behavior online changed over time, it became clear that search ads can no longer be based on one’s luck and hunch. The decade-old strategies are not effective anymore, and experts have to put much more effort into search ads in order to elevate their success rate.

Also, more and more often, some disappointed marketers’ voices could be heard behind the scenes. Why? It appears that in an era of increased focus on precise targeting, the market’s preeminent search engine advertising solutions like Google Ads have major limitations.

In this article, NewProgrammatic names major search advertising restraints and shows how alternative ads solutions could help marketers handle search advertising in 2022.

Single-line search engine advertising campaigns and strategies

A common marketing technique and really valuable practice for everybody in the search ads market industry is to try diversifying strategies for search and display ads.

Google search engine results pages are of course an immensely valuable source of both organic and paid traffic, but are certainly not the only tool that can be used to reach new audiences. Experienced advertisers have noticed that a long time ago, and they do not limit their actions to just one form of reaching internet users in their search results.

It is best to differentiate paid search advertising campaigns

It has been proven a long time ago that online advertising bears the best fruit (with the best online sales conversion rate) when approached with caution. Programmatic solutions help advertisers and brands by allowing more control over targeting parameters and bringing in a much-appreciated first-party data processing. What is also essential, is the fact that with this kind of tool, a brand can display ads on more niche-oriented search engines with a better chance of challenging their competition.

The broad and versatile operation brings beneficial intel to any marketing team. It helps determine which platforms, what keywords, and what configurations bring the best conversion rates and the highest ROI. This of course requires some increased ad budget, but such knowledge coming from a trial and error method could only become advantageous.

Most popular search engines can be too competitive

As these are the tools that offer the widest reach and the biggest audience, most brands, and companies want their campaigns to do the best in their paid search advertising offers on Google, Yahoo, Apple, or Bing. This is a completely understandable approach, but it works best on two occasions.

When do paid search ads work best?

1. When a company has close-to-unlimited advertising resources and could bid really high for a search ad placement. Most advertisers are not global market leaders and have no possibility of investing millions into search ads campaigns. This creates a situation where it is almost impossible to compete for a paid ad placement against the biggest brands on the most common keywords.
2. When a brand is niche-oriented. Most marketers discourage their brands from using generic keywords so that they do not have to compete against monopolists. Targeting very specific keywords is of course a practice that is increasingly gaining importance in the online marketing world, but it could be done also outside Google Ads, Yahoo Search Marketing, or Apple Search Ads. By using custom programmatic search ads exchange platforms, a brand can get access to specialized vertical search engines, niche-oriented queries, and intent-based traffic.

This allows brands to avoid standard SERP competition, as well as gives them a way to reach a user who is already purchase-driven. This type of audience is certainly first-class, as ad-receivers are already convinced to buy.

Giving the precisely targeted user an answer as to where to make a purchase will only become an asset. In this case scenario, the online advertising process and conversion funnel cease to be an unwanted necessity for the consumer. It actually becomes a much-needed helping hand.

Bigger ad spend means better search advertising results

The wider reach that most popular search engines offer elevates the CPC. Therefore, if any brand or marketer wants to increase their paid position in the most popular SERPs, budget adjustments are going to be a necessity.

It is also very important for any marketing team to remember about organic traffic. Organic search engine results bring new customers as well, attracting them via unpaid search results. Although major focus tends to be focused on programmatic advertising, the proper application of traditional SEO rules will only increase the brand’s chances of obtaining new users.

Changing users’ preferences and expectations

Every user of Google, Apple, Yahoo, Bing, or any other popular search engine should be familiar with how search advertising works. Some years ago this was not the case but as Clutch.co’s study suggests – currently 80% of search engines users are able to recognize paid placements in their SERPs.

Every brand and each marketer should be cognizant of these online search advertising trends in users’ behaviors and preferences. As the audience is aware of how they are being advertised to online, the changes in how online marketing is approached by advertisers are a necessity.

Modern user appreciates the facilitation of processes

What marketing specialists can do to increase their audience’s engagement while satisfying their expectations, is to answer to UX trends that are gaining importance. A modern Internet user expects to receive personalized ads that are actually helpful.

Therefore, by using custom programmatic solutions, advertisers are able to achieve a few goals at the same time. With browser-inserted tiles or search queries autocomplete, their audience becomes grateful for not having to go through multiple search results proposals.

Google search ads are, of course, immensely important, as they operate within the most popular search engine on Earth. The California-based company was responsible for more than 85% of desktop search traffic in 2021, and its advertising revenue reached $209.49 billion last year. When compared to 2020, it’s a 149% revenue growth. But all this does not mean traditional search advertising options should be the advertisers’ focal point.

In fact, increasingly more users try to skip the traditional SERPs, and would much rather be given a precise proposal while still typing their search query. What gives satisfaction to this type of user, is the fact that they are presented with an answer right away, without having to put much thought into the process. This is a result of the fact that currently humanity is being overloaded with information, and seeks facilitation wherever it is possible. A traditional top-of-the-page paid proposal actually becomes outdated in this case scenario.

Too broad of an audience

One of the most common mistakes of rookie advertisers is trying to reach every user out on the Internet without considering the actual targeting. This approach is destructible for the campaign, and it is a relict of the past times when marketing did not have the tools needed for precise audience picking. Nowadays, the industry understands that narrowing down the audience, alongside contextual targeting, is the most important factor of a successful campaign.

With custom search campaigns on NewProgrammatic, it is possible to increase the conversion rate and the ROI.

Intent-based targeting allows brands to display ads more effectively

To keep the highest standard of online paid search advertising, the brands need to remember how to safely, yet efficiently, find the best-fit users for the purposes of their campaign. Only thorough research and analysis of market data will effectively allow advertisers to narrow down their targeting.

The context of this targeting is also a very significant element of any marketer’s agenda. Experience shows that modern users are more likely to convert when they are satisfied with the circumstances in which they receive an ad. In terms of traditional programmatic display ads, this means that a product or a brand needs to be advertised in a contextually similar domain. With a search advertising campaign, the main point of focus should be making sure that it provides the exact answer to what the user expects to receive.

Too many choices for the users

This is another aspect of why most popular paid search campaigns fail to meticulously extract the best-converting audience. The broadness of these search engines’ reach (like Bing Ads or Google Ads) becomes the reason they are unable to specify their audience in other ways than with proper keyword combinations or geographical and demographic filters.

This once again brings the topic of immense competition in the traditional Google Ads market. What an advertiser can not do there, as precisely as with programmatic custom solutions, is to safely and effectively analyze users’ behaviors and preferences based on the first-party data they provide.

Programmatic solutions can access vertical search engines

Modern users tend to pay increased attention to the comfort of their searches. The last few years have shown the whole industry, that vertical search engines will play an incredibly important role in the future. Current user preferences include highly-specific and accurate industry-oriented searches that allow them to save time and limit unwanted results.

By reducing the search results pages to only those offers that really match users’ preferences, the audience manages to facilitate the buying process. Whenever a user decides on a purchase, they can use a particular search engine to receive the best fitting results. This gives advertisers and brands a perfect opportunity to utilize those for advertising purposes.

As the audience is more willing to share their behaviors and data with a safe operator, it is very easy to find purchase-oriented users and accordingly answer to their needs. As they already know their expectations, as soon as they are presented with the right proposal, they will not waste their time.

By carefully selecting only the best fit for users, a brand can impressively increase its conversion rate and ROI, while being fully compliant with users’ expectations.

Household names are in favor

With Google Ads (formerly known as Google Adwords), as well as with other leading search ads networks, it has been proven that a user is more likely to click on a paid suggestion if they recognize the brand. While this is heavily beneficial for creating a brand’s presence in the audience’s subconsciousness and thus gaining a better market position, it creates an uncomfortable situation for smaller advertisers.

Depending on a platform and ad format, the audience is 26% (Google Ads) or even 33% (Amazon and YouTube) more likely to get involved with an advertised brand that they are familiar with. These are the conclusions that could be found in Clutch.co’s research about the online marketing industry.

How can a brand get ahead of the competition in search advertising?

With this in mind, brand owners should be aware of the fact that unless they are big, household names in their industry, they could struggle with outperforming the competition. But there is a way of avoiding this uneven duel – omitting users’ SERPs and directing the audience to a landing page right away.

This is exactly what custom programmatic search advertising campaigns offer. By winning a bid on a highly specific keyword selection in a vertical search engine, a brand can be proposed to a user before they finish typing the query. Should they be interested in what they were offered, they will use the suggestion without searching through the search engine result page.

It allows a brand to become a well-tailored proposal for a specific user without the necessity to compete for their attention.

A good idea may not be enough

A study showcases the two factors that have the biggest influence on whether an audience member gets involved with an ad or not. The first one has already been mentioned, and it is the familiarity of a brand’s name. The latter is whether the proposed paid result answers the query or not. But the whole process is still a lot more incidental than marketers would want it to be.

With this kind of knowledge, any brand or marketer should take into consideration everything they can do, to increase search ads’ effectiveness. If an audience member is actively searching for a product or service, the advertisement should become the offer they can not leave unanswered. That is why a user-friendly optimization of campaigns is another good practice for a successful campaign.

Some advertisers struggle with competing for ad space

Although the most commonly used search engines offer the widest reach, not every advertiser will benefit from them to the fullest extent. Programmatic advertising has already proven that a random, but broad users scope is far less effective than a well-thought and narrowed-down targeted audience.

To make sure that campaigns stay as effective as possible, marketers need to understand how to overcome trouble with the limitations they encounter. Thankfully, alternative programmatic solutions, although not mainstream, could help outperform their competition.

NewProgrammatic offers a range of functionalities that can boost every brand’s online performance. These include edge-cutting Tiles Suggestions and Search Autocomplete options.

A focus on keywords

The best advertisers on the market use all their experience to find out which keywords will fit best the product or service. There is always a potential of boosting the campaign’s reach and conversion rate, but there is an expert needed to untangle the results.

As with major search advertising solutions, it is demanding to challenge the competition, custom programmatic search ads work just perfectly. Targeting certain keywords alongside thoughtful contextual targeting and an intent-based approach toward users not only helps marketers boost their ads but also adds up to a positive brand image. A modern customer will appreciate pertaining to the highest standards. At the same time, it will benefit brand safety, which is a greatly emphasized topic in 2022.

This is why, although the idea behind the advertised product or service may seem brilliant, effective marketing demands much more than this.

Conclusions

It turns out that what could be the answer to those advertisers’ problems, is the custom programmatic advertising solutions. As search engine marketing will not lose its relevancy in the years to come, it is a great practice for everyone in the industry to use non-mainstream programmatic tools.

Relying on the most popular search engines could become a trap for advertisers who do not want to exceed their ad formats portfolios. Marketers need to follow the latest trends and expand digital marketing possibilities towards less popular, but possibly more efficient programmatic tools.

Book a NewProgrammatic demo and find a way out of the most common search advertising problems.

The post 7 search advertising problems that can be solved with custom programmatic solutions appeared first on NewProgrammatic Blog.

But every year, inventions and improvements in ad-tech technology, as well as new advertising possibilities, emerge – and 2022 will be no different.

The below list of programmatic trends in 2022 will make a great cheat sheet for every marketer and brand looking to scale their business. 

Key trends for programmatic advertising in 2022

In this article, we have listed a set of the most important programmatic trends for 2022. Following those should be undoubtedly a significant point of any brand’s and advertiser’s agenda for this year.

It highlights the pivotal directions that the programmatic advertising industry will follow in the months to come, and as the year progresses, the programmatic advertising world will have a chance to track trends’ relevancy and adjust strategies.

UX-centric approach

One of the key programmatic advertising trends for 2022 for all the brands and advertisers is putting an increased effort into the UX. User demands are changing over time, so it is crucial to be regularly updated about the latest trends and behaviors.

Currently, brands need to take really good care of the user experience while being presented with their campaigns. As the audience tends to base their judgment on their comfort, the wisest marketing tactics would be to deliver the highest standard of service.

A two-way trust between a brand and its audience is beneficial for the well-being of any programmatic campaign in 2022. Modern internet users are highly conscious of their privacy but are not unwilling to share their data. The trust is being built by allowing them to choose who should be processing it and for what purposes.

Another trend that really helps brands achieve a desired level of UX is sustaining proper ad relevancy and intention-based targeting. By showing already purchase-driven users content they expect, brands can easily challenge competition while still delivering a pertinent ad to the audience.

Cookieless-based approach

Rising concerns over online privacy and third-party data circulation enforced major changes to the way information about users is perceived by brands and marketers. To win the audience’s trust, a company must be following the expectations regarding the usage of data within marketing efforts.

As a shift toward safe first-party data could have been worrying about some advertisers, in 2022 the trend will only intensify. Some brands worry that changes will disable all possible ways of audience targeting, but this concern is unfounded. With programmatic ad buying solutions relying on first-party data, advertisers are able to target their audience precisely based on their intent.

This is definitely something the whole industry should be really careful about. We recommend visiting our blogpost on the future of programmatic advertising in a cookieless world to find out more about the topic.

Leveraging first-party data

Following the patterns of third-party data processing is a trend that brands and marketers should follow in order to fulfill environmental expectations. Should a respected brand follow outdated, third-party cookies-based schemes and solutions, it could potentially lose credibility among the audience.

The marketing industry should firstly be highly aware of their target users’ preferences, and secondly, make the greatest use of first-party-based solutions. This way users’ online privacy inclinations are satisfied as the data is processed in a highly competent, safe, and professional manner.

NewProgrammatic ad exchange platform offers exactly that – proper data processing, and safe and user-compliant methods of receiving it.

Brand safety and brand visibility

Programmatic advertising enabled the whole marketing industry to really guard brands’ good reputations. The decision of trusting the programmatic buying solutions created a safe space for advertisers where they are able to filter out all the unwanted traffic and attract only a specific type of audience.

Using programmatic keyword targeting allows brands to focus on specific search queries and keywords. This filters out all the potential unwanted programmatic displays on unwanted domains.

This type of management has become a crucial part of creating a brand’s online presence and is definitely a beneficial marketing practice.

Many advertisers tend to forget how important the image of a brand (as media buyers) is when it comes to online advertising. Having a respected environment of ad display is, by all means, helpful, and raises the possibility of conversion with an engaged user is much higher.

The same solutions are being constantly used as a form of reaching the potential customer before the competition, as well as a way to build the brand’s presence and recognizability. Brand awareness among potential customers is the foundation of creating a strong position in the market. Programmatic ad tech is a solution that enables that at an unparalleled-before rate and precision.

New Generations of the programmatic advertising audience

The two newest generations of consumers and media users are revolutionary for the advertising industry, as both of them have been raised with broad access to technologies. Now that Gen Z and Millennials are making purchase decisions and are responsible for market trends, their behaviors and preferences should be taken into serious consideration by all the marketing industry – the programmatic field in particular.

New technology as a platform to deliver ads

With younger consumers being more technologically advanced and competent with different kinds of devices, it would be unwise for advertisers to neglect the rising importance of innovation.

The numbers represent it clearly. Statista presented us with research findings that claimed that in 2020 there were 83.7 million AR (Augmented Reality) and a combined 50,2 million VR (Virtual Reality) users in the U.S. only. This has become even more important, as both AR and VR tools are starting to be the cornerstone of metaverse advertising that is being intensely developed as per Q1 of 2022.

The predictions are that by 2023 the U.S. AR user count will increase to 110.1 million while the VR device user count will exceed 66 million. This exponential rise in popularity of those tech solutions will in fact be something to explore in the future, especially with metaverse possibly reaching new highs in the years to come.

Connected TV (CTV) ad opportunities

Programmatic CTV is also a trend that has been visible for a long time, and it refers to increasing accessibility to internet-connected TV devices. In 2022 Connected TV is more popular than ever, and streaming services have finally started to monetize their immense traffic by advertising.

Brands are once again given another chance to reach a new type of customer by accessing the content provider users’ first-party data. For advertisers, it means that they could narrow their targeting even more and contextually try to interest a specified type of viewer.

Search advertising possibilities

Voice search functionality was at first (when introduced at the beginning of the second decade of the XXI century) only innovation, and the market would not perceive it as a groundbreaking change.

But with the improvements in artificial intelligence, major upgrades of virtual assistants, and the introduction of smart devices (such as speakers), people have started to use voice search more intensively. Voicebot.ai report shows that over a third of adults have used this kind of search, and the numbers will be rising.

This tool is not only a great solution for visually and physically impaired users but also something that programmatic advertising professionals should look carefully into. Voice queries are usually longer than what a user would search by typing (even up to 5 or 6 words long), and most often have a form of a question rather than a keyword cluster.

The video ads sector is keeping its trajectory

Video formats are something that advertising brands embraced a few years ago when text-based formats had to give the floor to newer solutions. This is strongly based on user preferences, and the rising popularity of TikTok is only another proof of the concept.

Ephemeral video clips are clearly something that the audience seeks in 2022, and it’s a perfect opportunity for advertisers. The digital ad spend for video formats has also been rising, and as Statista predicts, in 2022, it will reach $43 billion. It is almost double of video programmatic ad spend from 2019, which was $24.5 billion.

Mobile importance

A good idea for any advertiser would be to really focus on mobile advertising opportunities. This relates both to implementing more mobile-friendly solutions and introducing programmatic advertising to new portable devices.

Wearable tech is yet another way of reaching ad receivers, as smartwatches, smart bands, and other smart devices become more accessible and are equipped with better screens now.

The marketing industry has already become almost entirely mobile-optimized in a response to user preferences and year-by-year mobile growth. This is definitely something that brands and advertisers should stick to and definitely good practice for any marketing team member.

Buy now – pay later platforms

When analyzing buy now-pay later platforms, marketers should have two perspectives in mind. The first one is user-centric, and the other focuses on how brands could benefit from engaging with such traffic sources.

For a brand, it is always beneficial to narrow the campaigns down to those users, who are already convinced to make a purchase. By approaching positive consumers, the marketer increases the conversion chance of a programmatic ad campaign, while basically doing the user a real favor.

The well-targeted campaign will be a perfect response to the search query, with the possibility of customer bouncing significantly decreasing. The buy now – pay later model enables more brand safety, as the trail of the user is more likely to lead to a conversion.

The studies show that younger adults have currently very little trust for any form of loan or credit. Simply delaying the payment without going into any debt is a perfect answer for their needs.

One of the most prolific buy now-pay later is of course Klarna, which recorded $80 billion gross merchandise volume in 2021. Offering both highly efficient Search Autocomplete and Tiles traffic, it showcases how efficient NewProgrammatic features can become in a capable advertiser’s hands.

What is also a very important peculiarity of this type of online shopping, is the fact that it most usually revolves around transactions of a higher cost. Buy now – pay later platforms are obviously most widely used during more expensive purchases. This is why it’s a very convenient tool for those brands that want to attract higher-spending users.

Vertical search engines

In order to receive exact and already-filtered search results, users have begun to pay increased attention to specialized search engines. Vertical search programmatic advertising allows the brands to really omit the traditional, horizontal search engine (like Google) struggle to position the ads.

Instead of that, marketers can reach users based on their intentions within vertical search engines. Those are really easy to find out, as in this case, the audience more eagerly shares their data. Most often, they visit the search engine in order to make a purchase. Reaching an already-convinced audience is one of the most effective strategies in the industry, and is highly recommended for all advertisers.

In-house programmatic advertising

Another trend that brands are currently intensively following, is the progressive shift towards in-house programmatic advertising.

In the past, due to the technological complexity of programmatic solutions, this particular area of marketing was slightly falling behind other fields of advertising in terms of the ongoing in-house shift. As most of the marketing (i.e., traditional advertising) was gradually absorbed by companies, marketing professionals focusing on programmatic ad solutions were still mostly outsourced. But as a broad understanding of the topic rose, more and more experts have been hired to operate in-house for the companies.

The in-house form of conducting campaigns imposes the necessity of having only the highest-skilled professionals on board. In this configuration, utilizing a trusted programmatic advertising platform could outperform any other form of outsourced programmatic ads operations.

This particular type of employment allows marketers to better fathom and plan a brand’s programmatic ads strategy, decreasing the operation’s expenditure and making space for more extensive programmatic ad spending. It is also a brilliant way of holding more control over successive steps of the campaign planning and bringing transparency to programmatic campaigns – without any external middlemen.

According to IAB’s 2020 research, as much as 74% of EU-based programmatic advertising was conducted in-house, while in the U.S. it reached 69%. The researchers expect both of those values to rise in the following years.

Intent-based ads

Based on 1st party processed by trusted publishers, quality programmatic advertising platforms allow marketers to bid for digital ad space that best reaches those members of the audience, who show the most probable intention of purchase.

While in the past this approach was heavily reliant on third-party cookies, nowadays thanks to programmatic advertising technology, marketers and brands are able to operate on first-party data.

Once again, it is an optimal practice for companies, especially since, although cookies and third-party data are still present online, they soon will be discarded. It’s also a matter of brand safety of the respected entities to follow new, privacy-focused trends. Otherwise, users could not be so eager to engage with a campaign they are being shown.

Contextual targeting

With programmatic advertising platforms, it becomes possible to display ads in accordance with the context of the website. Brands shall use this functionality for precise audience targeting – for example, sportswear brands will benefit most from programmatic display on sports-related websites, and not just any other domain. Approaching an interest-correlative audience thoroughly increases the chance of conversion, as relevant content will simply attract more users’ attention.

Keyword targeting

It has also become a good practice for advertisers to narrow down their campaigns by using keyword targeting. This is yet another form of contextual advertising which allows marketers to focus on bidding for a certain audience. This allows brands to reach a highly qualified and marginal type of relevant users, and also filter out all the unwanted traffic.

Although this method of targeting has been already recognized by worldwide brands for a long time, the new, cookieless online environment highlights the best qualities of this feature – brand safety and precision.

Conclusions

Every marketer and each brand that wants to stay relevant needs to pay close attention to trending user-behavior patterns, preferred technologies, and ad formats. This is to ensure the maximum efficiency of their campaigns.

Up-to-date knowledge of all the latest programmatic advertising trends is the only way for brands to fully reach the potential of their marketing campaigns. Escalating intent-based and contextual targeting is one way to do that.

Most of the programmatic trends for 2022 will be continuations of what the industry started noticing in the previous years. Still, neglecting those could turn out to be a critical mistake, as doing so could potentially decelerate brand development.

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The post What trends to follow in programmatic advertising in 2022?<span class="badge-status" style="background:#00E5D1">NEW</span>  appeared first on NewProgrammatic Blog.