Dynamic Creative Optimization: Definition, Examples & Importance

Dynamic Creative Optimization: Definition, Examples & Importance

Julian Frachtman
Julian Frachtman

Chief Executive Officer, Airtory

Published on: 25 Jan 2022

Reading time: 5 minutes

Most marketers understand that personalization is the most effective method for a brand to stand out, especially in today's super noisy digital landscape. Every user in your target audience, being unique, prefers a personalized experience when interacting with a brand, as that makes users feel special. That is where Dynamic Creative Optimization (DCO) comes into play.


Dynamic creative optimization (DCO) is a display advertising technique that integrates graphics within an ad creative based on data about the viewer, like the products they have seen, their geolocation, etc. The best example of dynamic creative optimization works to enhance the overall appeal and functionality of an ad.

When such personalized ads are created, the graphic components are pre-defined at the time of setting up the campaign while real-time information is dynamically added for different users before serving the ad. More than integrating generic creatives, dynamic creative optimization utilizes AI and machine learning to choose the most relevant ad components in real-time for every user.

DCO revolves around using specific visuals within an ad creative while leveraging a customer's user data to improve the ad’s efficiency.

DCO On Social Media

Dynamic creative optimization is a technique that not only works for digital advertising campaigns but also for social media platforms. For example, the Dynamic Ad Creative (DAC) functionality on Facebook offers dynamic creative optimization that combines your creative material to provide your audience with an optimized and performance-driven ad experience.

Dynamic creative optimization on social media can be used to run multiple ad components in front of your target audience while gathering data from each trial to discover which elements generate the best results. Images, videos, CTAs, and other media formats can all be used as ad components in such ads.

You can reach new customers, enhance customer satisfaction, and retarget old clients with ease through dynamic creative optimization. It's also very easy to examine your findings which can further help gauge how well dynamic creative optimization is working for your brand.

Importance of Dynamic Creative Optimization

Leveraging DCO as part of your digital marketing campaign comes with a number of benefits, including:

  1. Enhances the personalization aspect of your campaigns

No two audience segments are the same. Even within a niche cohort, the interests and drive of each individual may vary significantly.

Consider two different users, both looking for supplements, where the first user is more likely to choose a product based on its ingredients and results, while the other may only be looking for a natural supplement. A generic ad may appeal to one user and not the other, giving rise to a very real possibility of you missing out on an entire audience segment. 

DCO tools allow you to target each different group of your target audience and to personalize the advertisement, which also reduces the chance of it being flagged as spam or irrelevant.

  1. Responding in real-time

Making ads that suit each viewer in your target audience is something that would involve significant effort and time from your side. The entire process however can be simplified with DCO. A dynamic creative optimization platform works by collecting information (like buying patterns, location, etc.) about users to serve the most relevant ads for them instantly. As it responds to users in real-time, it also helps make the audience more responsive towards the ad, which in turn helps boost conversions and sales.

  1. Automated process

The DCO technique is fully automated and does not require human intervention or effort. It functions automatically to gather user information and to display the most relevant creatives to the right users. The complete automation of the process frees up a lot of time for your marketing team, where all they have to do is monitor the campaign’s performance.

The most suitable creative combinations are served to users, generated automatically using third-party data sources, while the best creative management platform which is integrated into DCO ensures that each element is completely optimized to enable the campaign to run automatically.

  1. Quick results and impact

DCO helps speed up the advertising process not just by having an immediate impact but also by doing its bit to improve the overall effectiveness of your ad.

DCO provides the perfect solution for quick, personalized deliveries of ads to the right audience. It is not just the speed of application that you can harness through DCO as it also provides an immediate boost to the performance of the ad, delivering quick results. 

  1. Programmable rules

The rules that dictate the functioning of DCO platform algorithms are easily programmable using a DSP. For example, you can set up a rule that if a particular combination of ad components generates a lower CTR as compared to a different version of the same ad, the former combination will be discontinued on the platform.

Leveraging Dynamic Creative Optimization for Your Business

DCO can be simple or complex, depending on the number of iterations you wish to integrate into a certain campaign. For example, if there is a car dealership that has a presence in 12 different cities, they may want to personalize their ads based on the location or user’s car preference based on their previous product views. This would mean more than 12 (location-based only) distinct creatives and communication for the same ad and the AI in control of the dynamic creative optimization process would have to ensure that the right ads are displayed to the right individual.

DCO processes also work extremely well for the e-commerce and retail industries, where adaptive messages are developed based on the lifecycle, interests, etc. of the users. The approach allows marketers to retarget users, create limited period ads (like “deal of the day” promotions), retarget products in the cart, incorporate location-based incentives, and do much more.

Dynamic Creative Optimization (DCO) is a tool in marketing that comes with several proven benefits and has great scope in the near future for helping advertisers and marketers to enhance their campaigns and generate better results. Useful for all types of platforms, whether it is Facebook or Google, dynamic creative optimization enables the creation of personalized ad experiences instead of generic display ads.

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