Programmatic advertising uses an automated process to purchase digital ad inventory across website, mobile, apps, video, and audio. Advertisers use programmatic buying software to set a budget, identify their target audience, and then use demand-side platforms (DSPs) to place those ads on the platforms that will be most effective in reaching their audience. This means that one key audience can be targeted over several different types of devices.
What is Programmatic Buying?
There are several different types of programmatic ad buying, and there is considerable variation between them. Real-time bidding (RTB), for example, is a commonly used variant where ad slots are open to all and sold via an auction process to the highest bidder. RTBs often use a second price system where the highest bidder is charged on average $0.01 more than the second-highest bidder for the slot.
Private marketplace (PMP) is another commonly encountered type that functions similarly to RTB, but in this case advertisers are only able to take part on an invitation basis. There's also the preferred deals form of programmatic buying software, where advertisers are able to choose ad inventory at a fixed price. This is not an exhaustive list – there are even more types to choose from, which offers a considerable variety for teams to consider.