What are RTB, Programmatic Direct and Private Marketplaces?

by Mike Tyler | October 3, 2020


Do you know the difference between Real-Time Bidding (RTB) vs. Programmatic Direct vs. Private Marketplace Advertising?

Knowing what each of these terms means is crucial to your ad buying knowledge.

These 3 elements of programmatic ad buying will up your game and make your advertising experience better. Each has its own place in the vast programmatic ecosystem!

It’s no secret that programmatic ads are the real-time solution to your ad buying woes – automating the entire purchasing, placement, and optimization process for you, leaving you more time to focus on what matters most.

By 2021, experts predict that 88% of all display ad dollars will transact programmatically. That’s huge!

 

We have a full guide on “What is Programmatic Advertising” here.

This post gives you a brief primer and then explains each of the 3 main ad-buying formats to you.

Let’s get started.

Programmatic Ad Buying: Overview 

Programmatic ad buying automates the process of targeting, segmenting and selling to your audience, according to age, gender, geography, and more. It happens in real-time, and delivers ads to your audience at the best time, at the best price.

Why is this beneficial?

Ad budgets need to be optimized so that you spend in the areas that give you the highest ROI, and cut back in the areas that aren’t doing as much for your business. Lean budgets work better.

It’s different from traditional ad spending in that it’s tighter, more efficient, and saves you time and money.

Based off a series of algorithms that work in real-time, it doesn’t rely on manual insertions and manual trading; the ad space is bought via the bidding system.

Long story short–programmatic ad buying is here to stay, and now’s the best time to get the jump on it. How?

By reading onwards, and getting the jump on 3 things:

These are 3 elements of programmatic ad buying that most people completely overlook, and miss out on. you’ll nail the programmatic ad buying game, guaranteed.

Photo by Bill Oxford on Unsplash

Real-Time Bidding (RTB): Explained

Real-time Bidding (RTB) happens in a computer-run auction with real-time interactions – where the highest bid wins the impression. It’s hands-down the most cost-effective way of buying with access to the largest audience!

The bidding is blind, and publishers offer their inventory for advertisers (you!) to bid on.

You set the parameters for the bid price, network reach, and demographic segments. Then optimization happens at the impression level for the best bid possible on the best end result.

Why RTB advertising?

Jeff Green, CEO & Founder of The Trade Desk explains it best:

“Real-Time Bidding means that every online ad impression can be evaluated, bought, and sold, all individually, and all instantaneously. It is the future of all online advertising and enables exchanges and buyers to work together to programmatically sell and place bids on ads.”

It’s a win-win for publishers and advertisers alike.

Photo by Clément H on Unsplash

Programmatic Direct: Explained

What about RTB vs. programmatic direct?
Well, programmatic direct automates direct ad buys for specific campaigns.

It’s different from real-time bidding in the sense that programmatic direct deals are a guaranteed ad buy that doesn’t involve an auction – it’s direct and to the point.

The choice between the two depends on your industry, what your goals are, and how you’d like to go about it. RTB involves a lot more segmentation and control over your bidding choices, while programmatic direct is more, well…direct, with less control.

Programmatic direct includes guaranteed and non-guaranteed contacts, and revolves around guaranteed buys.

Private Marketplaces: Explained

What about programmatic direct vs. private marketplaces?

Private Marketplace(PMP) advertising gives the power to the advertiser, and you decide whether or not you want to choose specific inventory.

Known as a private-auction or ‘invitation-only,’ PMP includes unreserved inventory among select buyers, chosen via a Whitelist/Blocklist.

The biggest thing with private marketplace deals is transparency – publishers can choose to reveal specific pieces of information on inventory, and which sites ads will run on – in addition to the Deal ID’s issued.

Deal ID: the unique identifier that represents the deal made between publisher and advertiser within the auction environment, allowing the advertiser to reach premium placements, on-demand, through your DSP platform.

The best part?

You can apply your first-party data to any and all placements made. Basically, all the success you’ve achieved in open exchanges can be applied here, across premium placements.

PMP is premium access at the lowest price, without any time or money wasted. It’s efficient, transparent, and the tech can even replace the need for a direct sales team.

You can apply your first-party data to any and all placements made. Basically, all the success you’ve achieved in open exchanges can be applied here, across premium placements.

In Conclusion…

These are your choices when you step into the programmatic ad buying space. Choose between RTB vs. programmatic direct vs. private marketplaces and find the one that best suits your campaign. 

Whether you choose to engage in open-auction, real-time bidding, within a private marketplace for premium access, or programmatic direct for less hassle – you’re on the winning side with programmatic ads.

Let the bidding begin!

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