How to construct sales within programmatic? Open and closed auctions, fixed-price transactions, reserved inventory or no guaranteed – if you have not yet learned to understand this “cuisine”, read the article below!
The market of programmatic advertising
Over the last two weeks we introduced you to some of the concepts, which more than others confuse different participants on the market. In particular, we have defined Private Marketplace, as well as Programmatic Guaranteed.
While those two seem to be the most confusing ones, the market of programmatic advertising is still new for many of you and therefore it is not always clear what is what. Therefore, in today’s blog post you will find a schematic division of programmatic advertising and it’s explanation.
Programmatic advertising refers to the type of ad buying with a use of different software to buy or sell ads, so that program completes the processes for you, not the people. Thanks to programmatic, advertising processes became more efficient, less expensive or unreliable.
Even though the technology seems to replace human factor in such areas as dealing with ad tags, it is still the task of a human to plan and optimise the processes. In some scenarios, human factor is more important than in others. Below you can find the scheme, which shows the general structure of programmatic advertising and some short explanations to the every type.
As you can see Programmatic advertising can be divided into two main branches: Programmatic Direct and RTB (Real-Time Bidding). The main hallmark between them is that RTB has an auction-based pricing model and Programmatic Direct has the fixed one.
Real-Time Bidding – it is sales and purchases technology for ad impressions based on the principle of the auction in real time. RTB allows to maximize revenue from display advertising, since it automatically selects the most favourable offers of advertisers.
Programmatic Direct – it is a channel in which the inventory is sold via programmatic tools, but at the same time buyer directly communicates with a platform to make a deal. Exactly this technology allows industry experts not to slow down and engage more and more advertising budgets from traditional sales. Programmatic Direct appeared to be the missing link, which will help to complete the full transition to programmatic.
Preferred Deal – this feature allows Advertisers to get a deal for inventory at a negotiated fixed price, before it is made available to other buyers in the Open Auction. Sometimes the specific inventory is proposed only in Preferred Deals.
“Buyers participating in a preferred deal get a “first look” at the inventory that the seller pre-defines in the deal. They gain access to the inventory by bidding at or above the negotiated fixed price.”- Google Adexchange.
Open Exchange is type of digital advertising exchanges offering high quality and independent rated inventory, based on bidding options.
Going to programmatic markets is a good decision if you want to increase your revenue and gain operational efficiency. Understanding those markets will help you to choose the best option specifically for you and earn money in the most productive way.
Photo credit: SEOPlanter via Foter.com / CC BY