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What is programmatic advertising?

June 27, 2023
What is programmatic advertising?

We bet you probably haven’t heard about programmatic advertising before and if we are right, you should learn at your first convenience. Experts dubbed it as a black box of advertising universe with its potential vastly unexplored. 

In laymen’s terms, programmatic advertising is the process of purchasing and selling that is fully automated and occurs online. Programmatic advertising is a process where you use multiple platforms to sell your inventory on both publishing and advertising sites; it also entails the practice of placing ads and buying inventory on a third-party’s site. This practice is also known as programmatic marketing. 

The process is quite hectic as it involves doing everything manually as it entails negotiations with the third parties, making RFPs (requests for proposals), and inserting orders manually. However, the transaction occurs in milliseconds despite the fact that it involves multiple platforms. 

Programmatic advertising working explained

 

Programmatic Digital Advertising works in the following way:

Step 1

The website initiates automated bidding for ads as soon as any viewer lands on it. The bidding is started to serve viewer-centered (an ad that is in accordance with the likes and dislikes of the viewer) ads to the target audience. 

Step 2

When it comes to programmatic ad buying, SSP (commonly known as a supply-side platform) acts as a seller for the publisher (one who is displaying ads). SSP acts as a seller by informing advertisers/bidders about the various features of the sites, users, and ad space. 

Step 3

The supply-side platform initiates amassing information about the viewer through cookies such as his demographics, geography, interests, and other things as soon as it collects information about the ad space from the bidder. 

Step 4

Once SSP has performed its side of functions, DSP (commonly known as demand-side platforms) initiates reviewing the data collected by SSP. In this way, a DSP lets advertisers select that ad space that aligns with their targeting parameters and advertising budget. In this way, we can easily say that programmatic advertising offers unique and data-driven solutions to advertisers. Therefore, advertisers get the most out of their advertisement expenditures. 

Step 5

Once DSP has performed the aforementioned functions, it makes bidding for placing an ad on your behalf. As stated above, all this happens in milliseconds and in real-time. This has led to referring to programmatic ad buying as a real-time advertisement. 

Step 6

As SSP receives bids from multiple DSPs, it picks the one that fits it well. When it comes to real-time advertisement, sites deploy a wide array of strategies such as client-side bidding, waterfall bidding, and header bidding among several others. To your knowledge, all this process occurs in milliseconds, even during the timeframe when a specific page is loading. 

Reasons you should use programmatic advertising

Following are the reasons that you should pick programmatic advertising over conventional bidding: 

Data-driven Advertising

The biggest advantage of programmatic ad buying is that it allows you to target the exact audience by delivering data-driven decisions. Therefore, you target the right audience and deliver them the right message at the right time and place. 

Full ROI Guaranteed

By making data-driven decisions that target the right audience, you are guaranteed a 100% return on your investment. Programmatic Digital Advertising slashes the risk of going your advertising budget to waste. Therefore, it is gaining popularity among advertisers. 

Real-time measurement and optimization

Thanks to this amazing invention in the advertising multiverse, you can now measure the performance of each ad that you place on a website in real-time. You don’t need to wait anymore for the excel sheets from the agencies (that take weeks or weeks to arrive). 

Transparency

Before the inception of programmatic ad buying, advertisers have no option but to rely on the monopoly of the agencies. Thanks to its arrival, now you have full authority to target the right audience and to spend your hard-earned money wisely. 

If you are spending on digital ads, we recommend you switch to programmatic advertising at the first available moment. By doing so, you will get the most out of your advertising budget as you will be targeting the exact audience to whom you want to sell your products or services. Also, the target audience gets full satisfaction from the ads on display. 

Samzec

AUTHOR

Sam is an accomplished writer, blogger and tech-savvy enthusiast. His passion lies in helping others understand the complexities of the latest and greatest in information technology.

He specializes in producing comprehensive, step-by-step guides that are designed to be easily followed by even the most novice user. Sam’s work has been featured across multiple blogs and websites and has helped countless individuals get the most out of their technology experience.

With over a decade of experience in writing about technology related topics and a degree in computer science, Sam is considered one of the leading experts on all things tech.

When he’s not writing or coding, he enjoys spending time with his family, playing guitar and exploring new places around the world.

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Samzec

AUTHOR

Sam is an accomplished writer, blogger and tech-savvy enthusiast. His passion lies in helping others understand the complexities of the latest and greatest in information technology.

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