In the past couple of years, many brands have started investing in programmatic advertising efforts a lot more, which has quickly turned the strategy into the leading method for buying and selling ads in digital spaces.
Companies that haven’t started utilizing programmatic advertising efforts yet should start doing so as soon as possible so that they can reap all of its benefits. Programmatic advertising efforts are made possible by programmatic ad platforms or artificial intelligence and software tools that are used to buy and place ads for companies.
These types of platforms include Google Ads, Amazon Advertising, and Microsoft Advertising. These days, programmatic advertising efforts make up over 70% of all the digital display advertising budget.
This is because they provide companies with plenty of benefits and advertising opportunities to reach more audiences and improve the efficiency of the ad campaigns that they create. There are three types of programmatic advertising that companies can utilize.
The first type of programmatic advertising is real-time bidding, which is where companies place bets on advertising spaces in real-time, similar to the way that auctions work. Then, the ad space is sold to the highest bidder.
This is a very fast process that happens in milliseconds, and all of it is automated with different types of software.
According to reports, the global real-time bidding market is expected to grow at a compound annual growth rate of over 20% in the next five years.
The second type of programmatic advertising is private marketplaces.
These are private digital spaces where companies and ad space sellers mutually agree on a price for an ad space ahead of time.
This can be done either through programmatic guarantee deals or programmatic direct deals.
When media buyers and sellers agree on the price of ad spaces ahead of time in private marketplaces, it can be done through two types of agreements.
The first type of deal is the programmatic guaranteed agreement between one company and many ad placement platforms.
The second type is a direct agreement between a single company and a media seller.
Both real-time biddings, as well as private marketplaces, can be programmatically bought.
However, it’s important for companies to remember that direct deals are more expensive compared to guaranteed deals, simply because they provide companies with a guaranteed ad space on their platforms or websites.