4 Types of Programmatic Advertising for Your Business [Guide]

Macy is a Content Writer at WebFX. With a Content Marketing Certification, she's an expert in crafting pieces filled with the facts about all things digital marketing. You'll find many of her pieces featured on UpCity's Top Digital Marketing Articles of the Week. When she isn't clacking her keys, she's wondering why her dog is so cute. Follow her on Twitter @iinfinitestorm.

Programmatic advertising is expected to account for 88% of digital display ad dollars by the end of 2021. This method of advertisement is rapidly growing, and if you’re not using it, you’re missing out on a prime opportunity to grow your business online.

On this page, we’ll answer your burning questions like:

  • What is programmatic advertising?
  • What types of programmatic advertising are there?
  • What types of programmatic ad formats are there?
  • How can I make the most of my programmatic advertising?

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Programmatic advertising definition

Programmatic advertising, also known as programmatic marketing, is the process of doing real-time buying and selling of ad space through an automated bidding system. This advertising form enables companies to purchase ad spots from different publishers and apps to reach their target audience on sites and apps they visit.

4 types of programmatic advertising

Now that we’ve covered the programmatic advertising definition, let’s move on to the different types of programmatic advertising. Here are the four main types of programmatic advertising options:

1. Real-time bidding

Fast facts: Open to the public, ads can appear on any site

First on our list of types of programmatic marketing is real-time bidding. With this option, advertising spots are open to the public — any company can bid on any location. This option is known as the open marketplace.

It’s called “real-time bidding” because this auction process happens instantly in real time.

These advertising spots are sold through an open auction with bidding. The company that bids the highest for the spot gets it. The company that wins the spot is not charged their highest bid amount, but rather, $0.01 higher than the second-highest bidder for the ad spot.

The biggest pitfall with this, however, is that you don’t know where your ads appear. You risk your ads showing up in places you don’t want them to appear.

2. Private marketplace

Fast facts: Invite-only basis, know what sites your ads appear on

Next on our list of types of programmatic advertising is private marketplace. Private marketplace operates on an invite-only basis. So, with this setup, a publisher sets aside their premium ad spots for a select list of advertisers.

Private marketplace is typically used by websites and publications with massive amounts of reach, like Forbes. These platforms have dozens of companies vying for advertising spots, so they can afford to set some spaces aside for top-notch advertisers.

With private marketplace, you always know where your ads appear. It takes away the mystery of ad placement you get with the real-time bidding option.

3. Preferred deals

Fast facts: Choose ad spots before they go on the public market, the publisher and advertiser must agree on advertising terms beforehand

Next on our list of types of programmatic advertising is preferred deals. Preferred deals, as the name suggests, enables advertisers to choose ad spots before they’re made available on private marketplaces or real-time bidding auctions.

If you choose the preferred deals, you pay a fixed price for ad space, known as spot buying. When an advertiser wants to pay for a spot on a publisher’s site, both parties agree on pricing, targeting, and more before claiming the ad space.

This option is a great one if you want to get a preview of the available ad space from an advertiser.

4. Programmatic guaranteed

Fast facts: Negotiations for ad spots are on a one-on-one basis, doesn’t require bidding

Last on our list of types of programmatic advertising is programmatic guaranteed. This option takes the traditional approach to media buying. Advertisers and publishers negotiate the terms of an ad space on a one-on-one basis — this setup means there’s no bidding involved.

With this option, advertisers get to choose their price, who they target, and how frequently their ads appear. This option offers the most control to advertisers, but it comes at a price. You need to have a bigger budget if you want control over your ad’s exact placement and cost.

Programmatic ad formats

Now that you know the different types of programmatic marketing let’s move on to the programmatic ad formats. When you craft your programmatic ad, you can take advantage of numerous format options, including:

Display ads

Display ads are the visual ads you see in the header, footer, or sidebar of a website. You create these ads through display networks like Google and Microsoft. This programmatic ad format is one of the most common options companies use to reach leads on third-party sites.

 

 

Video ads

Next, we have video ads, which are programmatic ads that feature video footage, as the name suggests. These ads can appear in three places:

  • Instream: Video ads will run as an advertisement before a user watches a YouTube ad. These ads are in the video player.

 

 

  • Outstream: These video ads can appear between two articles or in the midst of an article. These videos can also display as pop-ups or drop-down videos.

 

 

  • In-display: These ads appear in search results for videos or in the recommended videos panel on YouTube.

 

 

Native ads

Next on our list of programmatic ad formats is native ads. Native ads are ads that can appear on any part of a third-party website. Advertisers choose which impression they want to buy and the price they pay. Advertisers purchase these spots through a demand-side platform (DSP).

On the other hand, publishers offer their supply of ad spots through a supply-side platform (SSP).

 

 

These ads can appear in the header, footer, or sidebar. They can also appear as:

  1. In-feed ads
  2. Paid search units
  3. In-article ads
  4. Promoted listings
  5. Sponsored content

…and more!

Voice ads

Next on our list of programmatic ad formats is voice ads. Voice ads, also known as audio ads, are advertisements that appear in audio content. These audio platforms include:

  1. Podcasts
  2. Digital radio
  3. Music streaming services

Some popular platforms for this content include Spotify, Pandora and BBC.

3 quick tips for doing programmatic advertising

Now that you have all the information about programmatic advertising, you’re ready to launch a campaign! To help your campaigns succeed, check out these three quick tips:

1. Know your market

If you want to be successful with programmatic advertising, you need to know your market. You must know who you’re trying to reach with your ads and how you want to reach them.

This information is vital to know because it determines how you run your campaign. If you don’t know who you’re targeting with your programmatic ads, you won’t know the best platforms to reach them.

Determine who’s in your target audience by identifying information like gender, age, and income. When you have all this information, you can determine which platforms they’re likely to visit so you can display your ads on those websites.

2. Set goals

Any time you run an advertising campaign, you want to set goals. Setting goals ensures that you know what you’re trying to achieve so that you can set your campaigns up for success.

You can set numerous goals, including:

  1. Increase brand recognition
  2. Increase leads
  3. Increase sales
  4. Increase phone calls
  5. Increase website visits

Think about your programmatic advertising strategy and what you want to achieve with it in the long run. Thinking about the scope of your campaign will help you set goals that enable you to succeed.

3. Make sure your ads appear in the right place

When you do programmatic advertising, you must ensure that your ads appear in the right place. As you saw in the types of programmatic marketing section, there are multiple ways your ads can appear on websites. When they do appear, you want to ensure it’s a valuable site for your business.

Whenever you run ads, you must keep your brand’s image and reputation in mind. You don’t want your ad to appear on a less than credible site because it makes your brand seem uncredible.

Track where your ads appear so you can ensure your ads are only showing on websites that will positively impact your campaign.

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In this guide, we covered:

  1. The programmatic advertising definition
  2. Types of programmatic marketing
  3. Programmatic ad formats
  4. Quick tips for driving success with your programmatic advertising strategy

After learning all this information, you may feel overwhelmed, and that’s okay! That’s where the experts at WebFX can help.

We have a team of over 250 marketing specialists that know the ins and outs of programmatic advertising and can help you craft a campaign that drives results.

In the past five years alone, we’ve driven over $2.4 billion in sales and over 6.3 million leads for our clients.

Ready to get started? Contact us online or call us today at 888-601-5359 to speak with a strategist about our programmatic advertising services!