Programmatic Advertising Glossary: 55+ Terms & Definitions
If you’re new to the world of programmatic advertising, we’ve got you covered. In this glossary, you’ll find programmatic advertising definitions to help you become more familiar with common acronyms and terms you might come across.
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Programmatic advertising glossary: 55+ programmatic advertising terms
Browse common programmatic advertising definitions below:
Ad budget refers to the amount you want to spend on your programmatic advertising campaign. You can usually set your budget and let the AI deliver relevant ads to your ideal customers.
Ad copy is the written text within your advertisement. Your ad copy communicates essential information about your ad and business, such as the benefits of purchasing your product or service, your contact information, and much more to encourage users to click on your ad and make purchases.
Ad inventory refers to the number of ads a publisher has available to sell to an advertiser.
An ad server is a platform that distributes ads to devices like mobile phones, desktop computers, and tablets and captures performance metrics.
Ads.txt stands for authorized digital sellers. It’s a text file where a publisher records who can sell inventory on the website.
Application programming interface (API)
APIs enable external applications to connect and transfer data from multiple platforms to a unified dashboard.
Artificial intelligence (AI)
Artificial intelligence refers to how you can teach machines to be rational and think similarly to humans. Programmatic advertising uses AI to automate and manage your ad campaign.
Audience extension is a process in which publishers enable advertisers to reach more members of their target audience beyond their website’s collected data.
An automated guarantee is an automatic transaction in the private marketplace where an advertiser can buy placements at a fixed price over a specified period of time.
Banner ads are advertisements that are usually displayed at the top or side of a web page. They typically contain some form of multimedia to grab users’ attention and entice them to click on your ad, like images.
Behavioral targeting enables you to create ads that target users based on their behaviors, such as the websites they visit, purchases they make, and more.
Brand lift, offered by Google, enables advertisers to measure their ad’s impact on the perception of their brand. It contains metrics like brand awareness, ad recall, and consideration to help determine how your ads influence consumers’ feelings about your brand.
Call to action (CTA)
A CTA guides users to take action on your advertisement. This can include browsing your products or making a purchase. CTAs usually involve colorful, eye-catching buttons that link to your website.
Click is a metric that refers to the number of times a user clicked on your ad.
Click-through rate (CTR)
Click-through rate (CTR) is a ratio that describes the percentage of users who clicked on your ad based on the total number of users who saw your ad.
Contextual advertising refers to placing ads on web pages based on the content of those pages. As a result, advertisers can create targeted, relevant ads for users based on the content they are viewing.
Conversion rate is a metric that enables you to view how many users who saw your ad followed through with your CTA compared to the number of users who didn’t.
Cost per acquisition (CPA)
CPA enables you to see what your company pays, on average, for a user to convert. This metric considers the value of a lead, conversion, or purchase.
Cost per click (CPC)
Cost per lead (CPL)
CPL is a metric that tells you what your company spends, on average, to obtain a new lead.
Cost per view (CPV)
CPV is a metric that refers to what your company spends each time a user views your advertisement.
Data management platform (DMP)
A DMP serves as a data storage, management, and analysis platform for marketing and advertising campaigns.
Display ads are advertisements that contain some form of multimedia such as images and videos. They can appear on websites, social media platforms, and more.
Demand-side platforms (DSPs)
DSPs are platforms that allow advertisers to manage their ad exchange and data exchange accounts. An example of a DPS is Google Ad Manager.
First-party data refers to information you can collect directly from your website visitors. You can collect first-party data to learn more about your audience, such as their demographics and behavior on your website.
In a first-price auction, advertisers bid a set amount on an ad placement or keyword, and the highest bid wins. The highest bidder will then pay the amount they bid for their advertisement.
The floor price is the minimum or lowest amount you are willing to sell your ad inventory for. Floor price can dictate how much digital ads the minimum cost of digital ads through an ad exchange or supply-side platform (SSP).
Geotargeting refers to choosing keywords and phrases related to locations, such as cities and regions, that your target audience is searching for online.
Impressions count the number of times a user sees your advertisement, even if that user views your ad multiple times. So, if one user views your ad six times, your ad has six total impressions.
Keywords are the words and phrases your target audience searches for when using search engines like Google. Advertisers try to target the best keywords for their paid search campaigns to ensure their ads reach the users who are actively searching for their products and services online.
A landing page is the web page a user is directed to once they click on your advertisement. Landing pages are often a product or service page or your contact page.
Machine learning is a category of artificial intelligence. It’s the science of getting computers to accomplish specific tasks by learning from large data sets without programming them to do so directly.
Maximum bid is the absolute most you are willing to pay each time a user clicks on your advertisement.
PPC advertising enables you to place advertisements on search results pages, social media platforms, and more. You pay each time a user clicks on your advertisement with PPC ads.
Post-click engagement is the practice of engaging website visitors after they click on your advertisement by encouraging them to take action, such as contacting your company or making a purchase.
A private auction is restricted to a specific group of advertisers. These advertisers can then bid on the ad inventory before it becomes available in the open marketplace.
A private marketplace is a real-time bidding environment only available to a specific group of advertisers.
Programmatic advertising automates online ad management by using AI and machine learning to streamline the ad buying and selling process.
Programmatic direct is a transaction between an advertiser and a publisher that takes place through a programmatic ad buying system.
Quality Score is a measurement from Google Ads of your PPC ad’s quality and relevancy based on a scale of one to 10.
Real-time bidding (RTB)
RTB happens when ad inventory gets bought and sold on a per-impression or view basis in real-time.
Remarketing is the process of targeting users who have already visited your website or showed interest in your products or services.
Return on ad spend (ROAS)
ROAS refers to how much money you earn in comparison to how much you spend on your advertisements.
Return on investment (ROI)
ROI enables you to measure the success of your advertising campaigns by calculating how much money you earn from your advertising investments.
In a second-price auction, advertisers bid a set amount on ad inventory. The highest bidder will pay the bid price placed by the second-highest bidder plus one cent. For example, if the highest bid was $5.00 and the second-highest bid was $4.50, the highest bidder would pay $4.51.
Supply-side platforms (SSPs)
SSPs are platforms that allow publishers to manage all their available ad inventory space. OpenX is an example of an SSP.
Target audience refers to the users who are most likely to purchase your products and services. Advertisers will often create personalized ads that resonate with their target audience to maximize sales.
Third-party data refers to information about Internet users collected by a third-party business or entity. Businesses can purchase this data to help expand their reach by creating targeted ads that reach more members of their target audience.
Traffic source refers to the source that your web traffic, or website visitors, are coming from. You can use traffic sources to determine which advertisements drive the most traffic to your website.
Video ads are advertisements that contain an attention-grabbing video for users to watch. Videos advertisements are usually more engaging than text-only ads.
Viewability is a metric that tracks the number of impressions or views earned by a programmatic ad.
View is a metric that refers to the number of times users have seen your ad.
Web traffic refers to the users who visit your website. Web traffic can sometimes be measured in visits or sessions and is a common way to track the success of your ad campaign’s performance.
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