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Programmatic advertising is the automated process of buying and selling digital advertising space in real time through automated bidding platforms. By reducing the processes involved in creating and running a digital campaign, these sophisticated systems enable advertisers, publishers, and agencies to purchase, sell, and deliver their ad inventory with minimal human input. Streamlining the creation and execution of digital campaigns, these advanced systems empower advertisers, publishers, and agencies to effortlessly buy, sell, and distribute their ad inventory with minimal human intervention.
In simpler term, it's the process of negotiating for an ad space on different websites, in real-time and in bulk. You would not need to contact Forbes or CNN to buy ad space, it is all automated in realtime or in less than a second.
Here’s a summary of how programmatic advertising works:
This entire process happens within the time it takes for a web page to load, ensuring a seamless user experience. Advertisers can also manage this process themselves by using a DSP and purchasing inventory directly.
Programmatic advertising is important for brands for several reasons:
In summary, programmatic advertising has transformed the way brands buy ad inventory, making the process more efficient, flexible, and scalable. This leads to less unsold publisher inventory and makes running effective cross-media campaigns easier and cheaper for advertisers.
The cost of programmatic advertising depends on several factors, including the type of programmatic media being bought, the quality of the audience, the prestige of the publisher, and the extent of targeting, among others. Programmatic advertising is generally sold on a Cost per Mille (CPM) model, which means cost per 1,000 ad impressions.
The price can vary significantly based on the quality of the inventory and the precision of the targeting. Higher quality inventory and more precise targeting typically command higher prices. On average, programmatic CPMs range from $0.10 to $2. This makes programmatic advertising less expensive than many other advertising mediums, making it more accessible for small businesses with limited marketing budgets.