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PROGRAMMATIC ADVERTISING

Programmatic ad buying, put simply, is the use of software to buy digital advertising. Whereas the traditional method includes requests for proposals, tenders, quotes, and human negotiation, programmatic buying uses machines and algorithms to purchase display space

IN MORE DETAIL​

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  • It is an automated process of planning, buying and selling digital advertising space

  • It uses AI and algorithmic software for the sale and placement of digital ads via ad exchange platforms

  • It helps connect publishers, those who have websites with ad space (ad inventory) to sell, and advertisers, those who want to buy that ad space, to promote their brand

HOW DOES IT WORK?

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EXPLAINING THE PROCESS 

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  1. A person clicks on a website

  2. The website owner puts the ad impression up for auction (SSP)

  3. Advertisers offer bids for the impression (DSP)

  4. The highest bidder wins the ad impression

  5. The ad is served on the website to the user

  6. The user (hopefully!) clicks on the ad and converts

TYPES OF PROGRAMMATIC ADVERTISING FORMAT

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  • Programmatic Guaranteed (PG): 1 -> 1 

Advertiser and publisher negotiate the terms on a one-on-one basis

  • Private Marketplace (PMP): 1 -> LIMITED NUMBER 

Slot available to advertisers on an invite-only basis. In private or closed auction, publishers set a premium ad inventory reserved for select advertisers.

  • Real-Time Bidding (RTB): 1 -> ALL 

Slots open to everyone and sold through an open auction type of bidding.                        The highest bidder gets the spot. The whole process takes place in real-time. ​

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ADVANTAGES OF PROGRAMMATIC ADVERTISING 

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  1. Gathering and analysing data and insights more efficiently thanks to automated technology,

  2. Reach: advertisers access to far more ad space on thousands of websites at once

  3. Improved targeting capabilities, easier to do segmentation, target the right audience at the right time and place.

  4. More transparency on the inventory a brand purchase (brand image)

  5. Improved tracking capacity of the ads and the interactions

  6. Efficient, Integrated buying platform (less time spent in negotiation)

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MOST RELEVANT KPIs FOR PROGRAMMATIC ADVERTISING 

 

To evaluate: 

  1. AWARENESS -> IMPRESSION: the times the ad appears

  2. CONSIDERATION -> CTR (click through rate): the times it has been seen and clicked

  3. SALES -> CONVERSION: conversion actions (buy, sign-up, download, comment)

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