Programmatic advertising investment is on the rise, with an expectation to to reach $271 billion by 2025. That is an enormous amount of ad spend that marketers are pouring into programmatic media buying - and with good reason. Programmatic advertising offers a smarter and faster alternative to manual digital advertising that is beneficial for both publishers and advertisers alike.
Gone are the days of tedious and time-consuming management, negotiations and purchasing of ad space. With its flexible nature, increased ad effectiveness and valuable data insights, programmatic advertising is now one of the most powerful tools in digital marketing!
In this blog post, we will dive deep into the world of programmatic advertising platforms: what are they, how they work and which ones you can use to maximize success for your programmatic ad campaigns.
What is Programmatic Advertising?
Programmatic advertising is a system that automates the processes and transactions involved with purchasing and dynamically placing ads on websites or apps. Programmatic advertising makes it possible to purchase and place ads, including targeted advertising content, automatically in less than a second.
Types of Programmatic Advertising
There are four main types of programmatic advertising methods available to marketers.
Real-time Bidding (RTB)
Real-time bidding (RTB) programmatic advertising is an open auction for advertisers and publishers where the ad inventory price is agreed upon in real time. Here, the highest bid wins.
Real-time bidding is advantageous for both advertisers and publishers. For advertisers, it helps them target relevant inventory - thereby increasing ROI on their ad spend.
For publishers, it allows them to collect data on bidders' purchase patterns and set prices for their premium placements accordingly.
These reasons make real-time bidding the most popular type of programmatic advertising.
Private Marketplace (PMP)
Private marketplace (PMP) programmatic advertising are auctions where only specific advertisers can bid, which are identified through a selection process set by the publisher.
Advertisers who want access to premium inventories before they become available to the open marketplace will prefer PMPs. This marketplace also offers a much closer relationship with publishers than with RTB.
Preferred deal programmatic advertising occurs when publishers sell their premium inventory in a one-on-one programmatic auction at a set CPM (cost-per-mille) price to a selected group of advertisers.
This type of deal allows for transparency between buyers and sellers - publishers are able to view the inventory before the ad runs, thus controlling the quality of the content while advertisers can take charge of inventory pricing.
In the case of programmatic direct, a publisher sends an advertiser an invite to buy their inventory directly without a bidding process. This means media inventory is sold at a negotiated price, usually CPM-based, to advertisers for a set time period.
Due to the nature of exclusivity and specificity of programmatic direct media buying, it is particularly useful to companies focusing on premium placements and brand safety. But note that advertisers must have a big budget to use this method.
Benefits of Programmatic Advertising
Here are key benefits of programmatic advertising:
Programmatic advertising allows advertisers to know exactly where their ads are being placed. It also gives them insight into whether those ads are viewable and how they are performing.
Real-time measurement is a game-changer for marketers. It allows access to key data around the clock. These metrics include click through rate (CTR), impressions, media cost, complete views, conversions, etc.
Automating the process of buying ad space eliminates human error and increases efficiency. Campaigns can be optimized through machine learning applications to increase ROI and drive success.
Programmatic allows you to execute hyper-targeted ads to those consumers who you know are interested in your products and services.
The many targeting parameters available within a DSP help you pick and choose from the billions of impressions available across the real-time bidding ecosystem.
What is a Programmatic Advertising Platform?
Programmatic advertising platforms provide a real-time marketplace for buying and selling ad space. They link the millions of publishers to the marketers looking to place strategic ads across the internet.
So, how do programmatic advertising platforms work?
- A person visits a website.
- The website communicates with an ad exchange or supply-side platform (SSP) to offer the ad space.
- The SSP provides information about the user (e.g. location, device type, browsing habits) to demand-side platforms (DSPs) on behalf of the advertisers.
- Advertisers place bids on the available ad space through the DSP. The bidding process uses user data and targeting parameters to determine the most relevant and valuable placement.
- The ad exchange or SSP selects the highest bidder and displays the winning ad to the user.
What are Ad Exchanges?
An ad exchange is a digital marketplace that enables advertisers and publishers to buy and sell advertising space, often through real-time auctions. Ad exchanges are most often used to sell display, video and mobile ad inventory.
A Closer Look at Demand Side Platforms (DSPs)
A demand-side platform is a type of programmatic advertising platform for the advertiser side of the process. Advertisers make their bids via a DSP, and the platform makes the decisions for them.
A DSP stores user-profiles and third-party data and combines information with bids from advertisers. The DSP makes the decision about which ad to serve when visitors land on webpages. It must consider the bid made, with the highest bidder winning, the content of the ad, and the cost to the advertiser.
The pixel that publishers include on their websites sends the information to the DSP. The DSP has advertisers ready to make their bids automatically so that the best ad can be shown to the correct audience.
When the DSP and Ad Exchange have made a decision about which ad to match to which webpage, this is communicated to the SSP.
A Closer Look at Supply Side Platforms (SSPs)
A supply side platform is an integral component of the programmatic advertising buying process, as it holds the publisher's inventory. The publisher submits a webpage as a source for an advertisement, and after all is agreed on the Ad Exchange, they will put a pixel code on their page to track visitor behavior.
The code delivers anonymous data about visitors and the actions that they take. The SSP is programmed to maximize the value that publishers receive from an impression of an ad (an impression being an instance of the ad being shown to someone).
An SSP allows publishers to filter ads by the advertiser and other criteria, as well as set different rates for ad spaces to define the cost.
The Best Programmatic Advertising Platforms To Consider
Programmatic advertising is everywhere, and nearly every advertiser uses it, even if we don’t realize it. Here is a list of programmatic advertising platforms that you can consider for your marketing campaigns:
PubMatic offers comprehensive solutions for publishers and marketers, making it a complete programmatic ad platform.
Features include a private marketplace of high-quality ad inventory, a wide range of ad formats and channels, powerful real-time analytics, and fraud-free program refunds to protect against fraudulent activity.
With over 1.4 trillion ad bids daily, PubMatic is popular, and its excellent supply of high-quality ad spots is frequently cited.
Criteo Commerce Grid
The Criteo Commerce Grid uses large-scale purchase and intent data and commerce-focused AI to improve advertising returns on the open internet for marketers and media owners.
Criteo’s Commerce Media Platform offers different solutions to meet the unique needs of marketers and media owners. From enterprise brands to long-tail retailers, this platform helps everyone win with commerce media.
One of the most impressive features of Xandr is its incredible data, which allows advertisers to enhance their buying strategies. It offers an easy-to-use interface with all the tools advertisers need to optimize campaigns.
Google Ad Manager
Google Ad Manager is a massive programmatic advertising platform working on the supply side to monetize publishers’ content.
It includes a wide range of ad formats, offers machine learning to optimize campaigns and contains data tools to provide actionable insights.
The platform serves almost 6 billion ad impressions daily, making it a powerful partner for reaching your audience, no matter where they hang out online.
Adobe Advertising Cloud
Adobe Advertising Cloud is one of the best programmatic advertising platforms available to marketers.
It specializes in connected TV, video, display, native, audio, and search campaign ads to offer advertisers a complete solution. With a focus on people-based marketing and inventory management, it’s a great tool to maximize return on programmatic ad investment.
GumGum's Programmatic Ad Platform
GumGum's programmatic advertising platform boosts ad performance with proven contextual expertise, brand-safe targeting and high-impact units that stand out and capture the attention of audiences.
GumGum's Programmatic Solutions:
Verity™ Programmatic Solution*
Marketers can use Verity™, an accredited contextual intelligence platform, to power their contextual targeting, brand safety and brand suitability strategy.
Apply Verity™ at the pre-bid level in select DSPs or via private marketplace (PMP) deals across your DSP(s) of choice for display, online video (OLV) and connected TV (CTV) advertising.
Managed Programmatic Solution*
Leverage Verity™ to activate high-impact, captivating ad solutions in a custom, brand-safe PMP across 10+ top DSPs.
Gain access to a dedicated team that will help with avails, setup and troubleshooting throughout your campaign.
Leverage our industry’s first 100% brand safe ad exchange and keep your ads protected with a base layer of Verity™'s brand safety application.
Gain access to exclusive inventory in premium supply and ensure your ads appear in suitable environments.
*Solutions Powered by Contextual Intelligence
Benefits of GumGum's Programmatic Solutions:
Power your campaigns with leading contextual intelligence technology and engaging ad formats across all screens in a premium publisher network. Find GumGum's ad partners below:
Programmatic ad platforms can save you time and resources, and point your campaigns in the right direction. By eliminating all aspects of manual reporting, you can save time on manual data collection, ensure the accuracy of your data insights and recognize trends with ease with automated dashboards to maximize success for your campaigns.