What Is Programmatic Advertising?

You’ve likely heard the term “programmatic advertising” thrown around a lot lately. But what is programmatic advertising, exactly? In short, programmatic advertising is a type of marketing and advertising that uses software to automate the buying and placement of ads. Simply put, ads are bought and sold in real time through an automated system. As opposed to the traditional manual process.

Programmatic advertisers use both display and video ads. Additionally, it offers a number of advantages over traditional methods. For one, it’s far more efficient, since it eliminates the need for manual processes (such as RFPs, insertion orders, and manual trafficking).

What’s more, it allows you to target your audience more precisely since you can use data to target specific demographics, interests, and even behaviors. As a result, you’re able to get your message in front of those who are most likely to convert—which leads to better results for your business.

How Programmatic Advertising Works

Now that we’ve answered the question “what is programmatic advertising,” let’s take a look at how it works. In short, we know programmatic advertising is ad buying through an automated system. This system is a demand-side platform (DSP). DSPs connect advertisers with publishers (such as websites) where their ads can be displayed.

When an advertiser wants to run a programmatic ad campaign, they’ll first select their desired objectives (such as brand awareness or website traffic) and then set their budget. They’ll also specify their target audience using data points such as age, gender, location, interests, and behaviors.

Once all of this information has been inputted into the system, the DSP will automatically place bids on ad inventory from various publishers in real time. The highest bidder wins the ad spot, and the ad is then displayed on the publisher’s site.

It’s important to note that programmatic ad buying isn’t just about display ads—it can also be used for video ads (both in-stream and out-stream), audio ads, connected TV ads, and even native advertising.

Types Of Programmatic Media Buying

Real-time bidding (RTB)

Real-time bidding is a type of programmatic advertising that allows advertisers to bid on ad space in real-time. RTB is popular in display advertising. However, it can also be used for other types of advertising, such as video and mobile.

RTB allows advertisers to target specific audiences with laser precision, as they can bid on ad space based on factors such as demographics, location, and browsing history.

Private marketplace (PMP)

A private marketplace is a type of programmatic advertising that allows publishers to sell ad space to a select group of advertisers. PMPs are typically invitation-only, and they offer publishers more control over who buys their ad space and at what price.

PMPs also offer advertisers a guarantee of quality inventory. This is because they know that the ad space they are buying is from a reputable source.

Programmatic direct

Programmatic direct is a type of programmatic advertising that allows advertisers to buy ad space directly from publishers, without going through an intermediary. Next, programmatic direct offers both parties greater control over the transaction, as well as transparency in pricing and inventory.

Programmatic direct is often seen as a more efficient way to buy and sell ad space, as it cuts out the middleman and allows buyers and sellers to deal with each other directly.

Header bidding

Header bidding is a type of programmatic advertising that allows multiple advertisers to bid on ad space in real time before the publisher decides who will win the auction.

Moreover, header bidding can increase competition for ad space and lead to higher prices for publishers, but it can also be complex to set up and manage.

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Types Of Programmatic Advertising Channels

Display Advertising

Display advertising is a type of online advertising that involves the display of ads on websites, apps, and other digital platforms.

What’s more, display ads can come in a variety of formats, including static images, animated images, videos, and rich media.

Social Media Advertising

Social media advertising is a type of online advertising that involves the placement of ads on social media platforms. These platforms include Facebook, Instagram, and Twitter to name a few.

In addition, social media advertising allows businesses to target specific demographics and interests, and it can be highly effective in driving brand awareness and website traffic.

Video Advertising

Video advertising is a type of online advertising that involves the placement of video ads on websites, apps, and other digital platforms. Specifically, video ads can be either pre-roll (before the video content) or post-roll (after the video content). As a result, video advertising is an effective way to reach a wide audience.

It also can drive more brand awareness, website traffic, and sales.

Search Engine Marketing

Search engine marketing (SEM) is a type of online advertising that involves the placement of ads on search engines. This includes search engines such as Google and Bing.

SEM allows businesses to target specific keywords and phrases, and it can be an effective way to drive website traffic and sales.

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The Benefits Of Programmatic Advertising

There are many benefits of using programmatic advertising for your business. We’ve listed just a few below.

Increased Efficiency

Programmatic advertising is a more efficient way to buy and place ads. This is because it automates many of the manual processes that are involved in traditional advertising. This means that advertisers can spend less time and money on buying and placing ads.

While spending more time on developing creative campaigns that will engage and convert consumers.

Greater Reach

Programmatic advertising also allows advertisers to reach a wider audience than they would be able to with traditional methods. This is because programmatic ads can be implemented on multiple websites and apps. Rather than just on one specific website or app.

This gives advertisers the ability to target their ads to consumers who are most likely to be interested in their products or services.

More Effective Targeting

Another benefit of programmatic advertising is that it allows advertisers to target their ads more effectively. With programmatic advertising, advertisers can target consumers based on factors such as age, gender, location, interests, and even purchase history.

This ensures that ads are being placed in front of consumers who are most likely to be interested in them. Which in turn, can lead to higher conversion rates.

Bottom Line

As you can see, there are many benefits to using programmatic advertising for your business. If you’re not already using programmatic advertising, now is the time to start. It’s an extremely effective way to reach your target audience with relevant ads.

Doing this can convert into sales or leads. In addition, it’s more cost-effective than traditional methods like print or television advertising. So what are you waiting for? Start incorporating programmatic advertising into your marketing strategy now.