Digital advertising continues to make up billions of dollars in global ad spend, and programmatic advertising is the future of digital marketing and media buying. Programmatic advertising is a tool that helps a brand showcase an ad or marketing asset to a user who is part of the target market for that brand. This allows for businesses to market to who matters.
Digital advertising, like most marketing, is only effective if the correct audience is exposed to it. If a high schooler sees an ad for a real estate company, it’s unlikely to have any meaningful impact, as that teenager is not part of the real estate’s target or ideal market. Their market likely includes people of a certain income and age who have a search history that includes real estate terms or a housing search. Programmatic advertising helps populate web pages and other online places with your ad to relevant audiences who meet those established criteria.
Much like traditional media buying of billboards and print ads, there is a media buying process in place to help brands buy ad space on the sites that publishers are selling it using information both parties have about potential audiences.
What to know about programmatic direct
Real-time bidding vs. programmatic direct
The largest current model of programmatic advertising is called real-time bidding. As technology trends and consumer needs change, new developments have risen in how brands purchase their digital advertising, including the programmatic direct process. Here are the differences.
- Real-time bidding: Real-time bidding, or RTB, is when thousands of advertisers are bidding on an impression that is about to be delivered to an anonymous person who fits certain criteria like age, demographic, search and purchase history or other factors. Advertisers are not guaranteed to be on a specific publisher’s website or to receive a specific number of customer impressions. The media buyer who has winning bid has their ad delivered to a person who fits the pre-determined criteria on whichever site they may be on.
- Programmatic direct: Programmatic direct buying is the automated process where advertisers can buy directly from a certain publisher and allows the advertiser to control and optimize their campaigns against their own audience data and segmentation. In programmatic direct, the advertiser and publisher agree on a cost per thousand impressions and also the number of impressions. This allows ad buyers immediately identify and purchase inventory that will reach their target audience, for a fixed price and allows ad space sellers and publishers the ability to streamline sales and ensure they get the full value of their media placement.
The main reason that brands and publishers would choose to engage with programmatic direct is better transparency and understanding of quality. Publishers get a reputation for partnering with high-quality advertisers and brands get access to premium ad space availability. Some brands who engaged in real-time bidding struggled with issues in areas like reaching meaningful scale and providing a guaranteed volume commitment. Programmatic direct helps to reduce the impact of this pain point and allows for brands to work with more certainty.
Brands know that targeting customers both specifically and on various online platforms – both enabled by programmatic advertising – is important, hence the billions of dollars spent on digital advertising alone every year. But it’s also always changing, due to technological advances as well as customer attitudes. Customers are inundated with ads in all forms of media every time and being able to more accurately and consistently deliver ads to relevant customer segments is on the mind of every digital marketer. Programmatic direct is becoming a popular solution as marketers work to continue to grow their digital ad effectiveness and brand reach.