Understanding The Different Types Of Programmatic Advertising

Gone are the days of “Mad Men” and Martini lunches. Imagine Don Draper using algorithms for ads! Today, it’s about data-driven precision. Programmatic advertising has changed the game. Now, you can target specific audiences based on their online behavior and interests.

Having a robust programmatic advertising strategy is now crucial. Over 30% of marketers intend to boost or maintain programmatic marketing investment. Let’s delve into what it entails and how it operates along with its different types

What is Programmatic Advertising?

Programmatic advertising employs AI and machine learning for real-time ad inventory sales, effectively targeting optimal audiences. This automated approach minimizes manual efforts, utilizing various platforms and allowing advertisers to purchase ad impressions based on user signals or contextual cues. Its cost-effectiveness levels the playing field for publishers and advertisers of all sizes.

In April 2022, a report revealed that the Programmatic Ad Market soared to a whopping $136 billion in 2021, making up about 90% of digital display marketing.

How Does Programmatic Advertising Work?

Programmatic ads bridge publishers with available ad space and advertisers seeking to promote their brand. Advertisers engage their programmatic agency or trading desk to initiate digital campaigns, using a demand-side platform (DSP) for automated ad impression purchases to achieve campaign objectives.

A DSP enables advertisers to purchase ad space from various publishers, ensuring precise audience targeting via a DMP. This platform manages audience data, considering factors like location, demographics, behavior, and online activity. When a relevant user visits a publisher’s site, an ad request is sent to the SSP, which aims to maximize the impression’s value. The SSP conducts an auction, involving the connected DSP for ad placement.

The DSP quickly assesses incoming data, matches it with target parameters, and sets a bidding price for the initial impression. This real-time bidding, managed within the SSP or ad exchange, lasts just 100 milliseconds. Once sold, the impression is promptly sent to the publisher’s site for display, and the cycle repeats with each user interaction.

Also Read: Content Repurposing: How to Make Every Word Count

Four different types of Programmatic Advertising

At present, programmatic advertising holds a significant position in the advertising industry, accounting for a substantial 72% share of the overall digital display market.

Here are four types every business should know about.

1. Real-Time Bidding (RTB)

Real-time bidding or RTB is an open auction where there are unlimited ad spaces and the prices are determined via open auction. It is called “real-time bidding” because it is an open auction process that happens in real time. In RTB, there are many advertising spots open for the public (any company) to bid on any location that is available in an open marketplace. The advertising spots are sold via an open auction (open for the public) where companies do the bidding and the highest of bids gets the respective ad spot.

2. Programmatic Guaranteed

Programmatic Guaranteed uses open real-time bidding auctioning technology. It facilitates direct deals by using deal IDs. In this type of programmatic advertising, a publisher uses their SSP (supply-side platform) for connecting to multiple programmatic demand sources such as DSPs (demand-side platforms), ad networks, ad exchanges, ad networks, etc. Programmatic Guaranteed allows advertisers to choose their price, preferred target audience, and the frequency of their ad’s appearance.

3. Preferred Deals

Preferred Deals are direct deals between publishers, advertisers, or agencies. Here the buyers and sellers can negotiate the conditions of the deal. It allows sellers to provide a deal ID that can be used by buyers to directly purchase inventory. These programmatic deals significantly help in making decisions based on data that helps in determining whether to bid or purchase an ad impression at the negotiated price and automatically make it a preferred deal.

4. Private Market Places (PMP)

A Private Market Place or PMP provides exclusive access to advertisers to a publisher’s inventory. PMPs operate on an invite-only basis where advertisers know what sites their ads will appear on. Here a publisher usually sets aside their premium ad spots for specific advertisers. Private Market Places are highly prioritized over an open auction because here selected buyers have access to premium inventory before it becomes open to the public.

For the modern advertiser, programmatic advertising is a powerful tool because of its successful campaign rates. When opting for the approach to build a strategy that is helpful works for achieving your advertising objectives always look at their types and which type suits you best.

This further helps in combining the right software platforms with suitable programmatic deals to successfully build business relationships and increase your ad revenue.

Top 3 Programmatic Advertising Platforms

Listed below are the top 4 picks of platforms to help you choose easily.

1. Simpli.fi

Simpli.fi, a top-rated localized programmatic platform, offers seamless access to multiple real-time bidding ad exchanges. This all-in-one omnichannel advertising solution encompasses mobile, TV, social, direct mail, display, and video channels. Advertisers benefit from CRM data integration for precise audience targeting, with options to segment audiences by device, OS, browser, and location. Streamlining the digital ad space transaction process, Simpli.fi’s software is a comprehensive tool for advertisers.

2. MediaMath

MediaMath, an industry pioneer and the oldest Demand-Side Platform (DSP), offers advertisers a comprehensive omnichannel programmatic advertising solution. It efficiently manages campaigns across various channels including display, mobile, audio, video, native, and notably Digital Out of Home (DOOH) ads.

3. Adroll

AdRoll empowers advertisers with a user-friendly platform and top-notch ad templates, facilitating growth across various online ad offerings. With over 15 years of data from 120,000+ brands, it excels in audience targeting, including demographic, interest-based, lookalike, and CRM options. Its simplicity and effectiveness make it an ideal programmatic advertising platform, especially for beginners.

Concluding Thoughts

Programmatic advertising stands at the forefront of the ever-evolving marketing landscape. With the majority of marketers recognizing its significance and dedicating resources to its growth, it’s evident that this approach is here to stay. The ability to target audiences with pinpoint accuracy, driven by data and automation, has transformed the advertising game.