Programmatic Concepts and Terminology

Concepts and Terminology

The following concepts and terminology are important in your foundational understanding of what programmatic advertising is and is not.

Real-Time Bidding (RTB)
Often referred to as an “open auction,” real-time bidding utilizes auction technology to determine inventory prices. RTB is open to both publishers and advertisers and can be a cost-effective way to buy and sell ad space and ads to a large audience.

Private Marketplace (PMP)
As the name suggests, this type of marketplace is restricted to selected advertisers and publishers only. Using a private marketplace enables you to invite a limited number of advertisers and publishers, which can be advantageous when you wish to work with select publishers and advertisers to buy and sell premium inventory.

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NOTE

PMPs are executed using RTB pipes and require a DealID as part of the bid request.

Programmatic Direct
Using programmatic direct enables publishers to bypass the auction process altogether, and instead, sell inventory directly to advertisers at a designated cost per mile (CPM).

Supply Side Platform (SSP)
This software tool enables publishers to sell display, mobile, and video ad impressions to potential buyers in real time via other DSPs, ad exchanges, and/or networks.

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NOTE

SSPs and Exchanges were traditionally thought of as two distinct technologies; however, SSPs often have their own Ad Exchanges as part of their technology stacks.

Some examples of SSPs/Exchanges include Index Exchange, Pubmatic, and OpenX.

Ad Exchange
An Ad Exchange is a digital marketplace that contains a collection of ad impressions that advertisers and publishers can buy and sell, creating an efficient process where advertisers can easily buy ads across a range of different sites all at once instead of having to manually buy ads from publishers.

Some examples of Ad Exchanges include Google Ad Exchange, OpenX, and AppNexus.

Demand Side Platform (DSP)
This software enables ad agencies and different advertisers to buy ad impressions and ad space on publisher sites across multiple platforms.

Some examples of DSPs include Display & Video 360, The Trade Desk, and MediaMath.

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NOTE

The term “demand partners” may also be used to refer to DSPs.