Programmatic 101 – FAQ

By Betty Chen –  Senior Marketing Manager

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Programmatic buying is expected to account for 46% of all digital media spending in 2015*, experiencing steep growth as benefits grow and opportunities expand to more screens and platforms. However, the complex world of programmatic is mired in jargons and acronyms.

In this “Programmatic 101” series, we’ll explore what all this means and why advertisers and marketers should care.

What exactly is Programmatic?
Programmatic advertising is the automation of buying and selling media. Historically, media planning and buying often required tedious and inefficient manual tasks. Programmatic planning and buying uses software to identify and execute advertising decisions in real-time.

Within programmatic buying, there are two main sub-categories:

  • Real-time bidding (RTB): The fasted growing method of buying digital inventory from exchanges through online auctions in real-time (similar to financial markets).
  • Programmatic Direct: Allows advertisers to buy guaranteed ad impressions from specific publisher sites and execute via programmatic technology.

Why should advertisers and marketers pay attention?
Advertisers large and small are moving en masse into programmatic buying for good reason. Automated media-buying reduces planning time and advertising waste while maximizing efficiencies.

Programmatic enables media buyers to specify their goals and find valuable audiences by targeting ad inventory that matches specific parameters.

What are the alternatives?
There are three categories of alternatives:

  • Custom integrations with publishers
  • Manual execution of direct buys from publishers
  • Buying from ad networks

Outside of customer integrations, programmatic buying is the most efficient and effective option for buying digital media.

What’s with all the acronyms and what do they mean?
Going programmatic should not require learning an entirely new language! Save your energy for learning Valyrian instead. Here are the top acronyms you should know:

  • Data Management Platform (DMP): Simply put, it is a data warehouse. It is software that ingests and aggregates valuable data, helping advertisers better manage audience segments to understand the entire customer journey.
  • Demand-Side Platform (DSP): This is a piece of software used to purchase all formats of media and inventory through automated advertising.
  • Supply-Side Platform (SSP): SSP is the seller’s half of the marketplace. Publishers and other inventory sources turn to SSPs to provide their available inventory on a programmatic exchange.

Does programmatic only have access to remnant inventory?
Not necessarily. There is ample premium programmatic inventory that is available to advertisers. The volume and types of inventory varies by programmatic partner.

What type of metrics can be provided?
Programmatic ads can be measured through all standard metrics that are typically used in media buying (eg. CPC, CPM, CPI etc.) and can include rich insights as well.

To learn more, download the full Pocket Guide to Programmatic Buying. This guide provides marketers with everything they need to know to get the most out of investing in media through programmatic buying.

*http://po.st/PerceptionsGroupSurvey