Programmatic Buying

What is Programmatic Buying?

Programmatic Buying (sometimes also referred to as Programmatic Advertising or Programmatic Marketing) refers to the eco-system that enables automated way of buying digital ad inventory in categories such as mobile, display, video, social and now native. A by product of automation of the buying process is that it enables leverage of analytic data for better targeted ad serving resulting in better performance. Programmatic Advertising systems (such as DSPs, Ad Exchanges and SSPs) use techniques such as look alike and behavioural modelling in order to better target ads.

Major Components of Programmatic Buying

The Programmatic Eco System.
The Programmatic Eco System.

Benefits of Programmatic Advertising

  • Automated Media Buying: No more human intervention required. Media buying can now be simply carried out in an automated fashion by software tools that enables technology to be leveraged by human intuition and intelligence.
  • Better TargetingProgrammatic Advertising enables better targeting as these parameters can be applied at the level of each ad impression using a complex algorithm involving multiple variables.
  • Cost Effective: The improvement in targeting above along with increases choices (the same user can be targeted across cheaper ad inventory) increases the ROI hence making Programmatic Buying much more cost effective as compared to the alternatives.
  • Scale: It has access to a number of ad exchanges that have very large scale of inventory.

Benefits of programmatic advertising.

Issues with Programmatic Advertising

A number of times, publishers need to be able to mask their domains for legitimate reasons such as to avoid cannibalisation of the direct sales channel (that gives them higher CPMs) by the Programmatic Advertising route. This masking feature is sometimes used by bad actors who try to pass off their poor quality inventory as premium.

Ad Exchanges and DSPs are building better technology to identify and block these cases. In addition, the programmatic eco system has integrated with tools such as DoubleVerify to ensure brand safety from an advertiser perspective.