What is
Programmatic
Advertising and
How Does It Work?
The Advantages of
Programmatic
Advertising
Programmatic Advertising
The use of artificial intelligence and machine learning to buy ads in
real time, instead of going through human negotiations and preset
prices.
Data for Programmatic Advertising
•
Demographics (gender identity, age, location)
•
Device (desktop computers, laptops)
•
Interests (finance, coding, UX design)
•
Behaviors (consumes information on software development
every day)
Programmatic Advertising Is Effective
Because It Is:
•
Powered by data
•
Budget-friendly
•
Drives return-on-investment
•
Happens in real time
•
Automated
Programmatic
Advertising
Explained
Demand-Side Platform (DSP)
A system that allows buyers of digital advertising inventory to manage
multiple ad exchange and data exchange accounts through one
interface.
Supply-Side Platform (SSP)
A technology platform to enable web publishers and digital out-ofhome media owners to manage their advertising inventory, fill it with
ads, and receive revenue.
Data Management Platform (DMP)
A software platform used for collecting and managing data.
Here’s what programmatic advertising looks like all together.
Types of Bidding Strategies in Programmatic
Advertising
•
Real-time bidding
•
Private marketplace
•
Preferred deals
Real-Time Bidding (RTB)
Refers to the buying and selling of online ad impressions through
real-time auctions that occur in the time it takes a webpage to load.
Private Marketplace (PMP)
Like real-time bidding, but only available by invitation. Most demandside platforms have a private marketplace for their users.
Preferred Deals
Advertisers choose the preferred inventory and price before it is
available.
Exploring the
Programmatic
Advertising
Channels
6 Types of Programmatic Advertising
1. Display
2. Video
3. Social
4. Audio
5. Native
6. Display out-of-home (DOOH)
This display ad on the sidebar of The New Yorker's website is for AppExchange, a sales
optimization tool.
This webpage on YouTube has an in-display ad in the sidebar, as well as what's known as
a pre-roll ad in the main video window.
Programmatic ad software would likely show this ad to people on Twitter who have
expressed an interest in American football.
This ad for Dawn, a cleaning products brand, appears between podcast episodes on
Spotify for their free users.
This native ad video from The New Yorker is displayed about ¾ of the way down
the webpage.
Specsavers, an eyewear company, runs a digital out-of-home ad on the side of a phone
booth in a location right outside their shop.