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AnteriadSeptember 29, 20205 min read

Do You Know These 17 Programmatic Marketing Terms?

A few days back, I browsed for washing machines, as the existing one was having problems. Google showed me pages of options, product displays from popular eCommerce sites, and relatable offers. After some time, when I signed into my social media account, I could find advertisements for washing machines popping up everywhere. Bright, appealing pictures and lucrative discounts grabbed my attention without fail. But, the question is, how is this happening? How is my social media account aware of the product I wish to buy? 

Martech and AdTech have taken colossal steps in recent years owing to fast-paced digital transformation across diverse industrial sectors. (Made even faster thanks to COVID). The advertising industry has initiated the "royal journey" towards automation and programmatic marketing, which gives marketers an opportunity to purchase ad inventory and reach specific hyper-targeted users. One of the major developments of digital marketing is programmatic advertising, which lets you target specific audiences on a particular page they are visiting. 

Before you dive into the terms related to programmatic, let’s touch upon the very concept itself. 

What is Programmatic Marketing? 

Programmatic marketing can be defined as an advanced marketing strategy that uses automation and real-time bidding processes to help marketers make online ad purchases to reach a specific group of users. As a marketer, you can use this ingenious approach to curate highly targeted marketing content for certain demographics. You deliver the exact content to the potential customer at the perfect time. This automated marketing tool designs algorithms based on variables like geolocation, age, gender and browsing habits. 

What terms relate to Programmatic Marketing?

Now that you have the basic idea about this buzzword, let’s look at 17 important terms related to programmatic marketing and advertising. 

  • Real-Time Bidding (RTB): Before a website loads and content is delivered, a bidding process goes on for the digital ad space. An algorithm determines which company pays the highest price for the available ad space, based on the web browser and the bidding companies’ information. The highest bidder wins this auction, and a particular ad is displayed on that given space. This whole auction procedure takes place within milliseconds. 

  • Programmatic Direct:  As the term suggests, this refers to a direct deal between the ad publisher (seller) and advertiser (buyer), without any involvement of ad exchange parties. This programmatic media buying process is based on a fixed price, and no bidding is required here. 

  • Programmatic Buying:  Simply put, this refers to the use of software to buy digital advertising. Programmatic ad buying uses machines and algorithms to purchase digital space on a web page. You can purchase ad space by two of the above-mentioned ways, direct or real-time bidding. 

  • Advertising Inventory:  It refers to the number of advertisements or the amount of ad space that the publisher has to sell to an advertiser on an open market. With the increasing digital dependence, the ad inventory refers to website, mobile, app or any video space.  

  • Demand-side Platform (DSP):  Many digital advertisers (buyers) use this software to buy the online ad spaces from open marketplaces where publishers have listed their ad inventory. These platforms enable efficient management of advertising across multiple channels of real-time bidding networks. 

  • Supply-side Platform (SSP):  Just like DSP, SSP is a platform that the web publishers (sellers) and digital-out-of-home (DOOH) media owners use to manage ad inventory and generate revenue. This software makes the inventory available to the potential buyers via various channels, like ad networks, ad agencies, ad exchanges. 

  • Data Management Platforms (DMP):  This platform is a unified solution to collect, organize and analyze data collected from diverse sources like online, offline, mobile and beyond. DMP is the foundation of data-driven marketing, giving businesses insights into customer demands and preferences. 

  • Ad exchange/ marketplace:  As the name implies, this refers to an open digital marketplace where ad networks, agencies, advertisers and publishers of various sizes come together to buy and sell advertising space, often through real-time auctions. 

  • Private Exchanges:  These marketplaces are not open, and they have access restricted to a limited number of publishers. The private exchanges allow premium publishers having strong brands to sell their inventory to ad agencies, ad networks and media planners. These are based on real-time bidding platforms facilitating ad targeting and retargeting. 

  • Programmatic Creative:  This advertising technology contributes to speed, scale and automation in the creative process. This data-informed, software-assisted advertising delivers targeted digital marketing. It is the building, publishing, and optimizing processes of display advertising. 

  • Market Intelligence (MI):  A business gathers external data or information from the market in which it plans to operate. The information includes ongoing and upcoming market trends, competitors, customer monitoring, etc. 

  • Marketing Automation:  This is a software platform that marketers use to plan and manage marketing processes and campaigns across multiple online and offline channels. The marketers use this technology to automate online marketing, generate revenue, and boost efficiency. 

  • Social selling:  This is one of the most essential tools for marketers and sales experts to find and engage with new prospects. They use social media platforms like Facebook, Instagram, and LinkedIn for answering queries and comments. 

  • Cost Per Thousand (CPM):  Cost per thousand impressions is the price that the marketer or advertiser has to pay for receiving 1000 views or clicks to an advertisement. “M” stands for the Roman numeral 1000. Marketers use this standardized pricing method for measuring market engagement. 

  • Brand Safety:  This term denotes arrays of measures that business organizations take up to protect and manage the brand’s reputation when they advertise the brand online, or even offline. It simply means avoiding placing the brand ads next to inappropriate content. The brand advertisements should appear in the correct channels. 

  • Audience Segments:  This helps in dividing the audience of the campaign into various groups or segments based on defined criteria like communication patterns, demographics, product usage, media usage, etc. The marketing ads can target by segment, resulting in more tailored messages for stronger connections. 

  • Third-Party Data:  This refers to the information sold to advertisers by large data aggregators or data collectors. This data can be generated by surveys conducted on various segments of users, via cookies and also from campaigns. The advertiser is not the data owner; it’s purchased from any third party sources. 

Practice your programmatic!

Programmatic marketing or advertising brings valuable market and customer insights. The innovative technology helps your business target the desired customer base within the digital landscape.  If you’re interested in programmatic ad strategies, stay up to date with this blog from Craig Weiss, “The Future of Display Ads without Third-party Cookies.”