What Is Programmatic Advertising? How Is It Done?

Programmatic advertising is a method of buying and selling digital advertising space using automated systems such as software and algorithms. Human decision-making is left in the background and the purchasing process is carried out by machines using the digital data available. In a rapidly developing digital advertising sector, it has become one of the most effective and efficient media buying approaches for advertisers and agencies.

Unlike traditional advertising, ads are not purchased manually in programmatic advertising; they are placed automatically for a specific target audience in a digital environment. This allows advertising to be served at the most appropriate time and place based on data analysis. The result is a more targeted, lower-cost and more efficient advertising experience.

What are the types of programmatic media buying?

Programmatic advertising can be applied in various forms across different platforms. Each type offers a different strategy for reaching the target audience efficiently. The most commonly used ones are:

RTB (Real-Time Bidding): It works with a real-time bidding system. Advertisers bid instantly for digital advertising spaces and the advertisement with the highest bid is shown.

Programmatic Direct (Programmatic Guaranteed/Direct): This method involves purchasing a pre-agreed ad inventory at pre-determined prices. Unlike RTB, the volume purchased here is more guaranteed.

Preferred Deals: In preferred deals, advertisers can choose ad inventory at a fixed price even before it is made available in private markets and then in auctions open to everyone. The advertiser can browse the publisher’s inventory.

Private Marketplace (PMP): In this model, only invited or selected advertisers come together and make deals on specific ad spaces. It offers advertisers higher quality inventory.

How is programmatic advertising done?

While the traditional method involves requests for proposals, tenders, price quotes and negotiations, programmatic buying uses algorithmic software to buy and sell online display space.

The process is carried out in several steps, and implementing them correctly directly affects campaign success.

Target audience determination: The most important stage is defining the target audience correctly, taking data, demographic information and user behaviour into account.

Ad inventory selection: Ad spaces suitable for the target audience are determined. These are purchased through digital advertising platforms such as the Google Display Network or social media platforms.

Budget and bid settings: The advertiser determines its budget and bid strategy. If real-time bidding is used, the bidding process begins.

Ad design: Ad content is designed to appeal to the target audience, with visual or video creatives produced accordingly.

Data tracking and analysis: After ads go live, performance data is tracked and optimizations are made when needed.

Programmatic advertising uses AI-powered algorithms to purchase publishers’ ad space. It evaluates users’ behaviour, demographic data, cookie data and other criteria to determine which ad should be shown to each user, which produces the most accurate match.

What are the advantages of programmatic advertising?

Programmatic ads allow advertisers to create more effective and measurable campaigns. The main advantages are:

Increased efficiency: Since programmatic advertising uses data and automation tools to optimize targeting and bidding, advertisers reach their audiences more effectively and efficiently.

Advanced targeting capabilities: Advertisers can combine remarketing, geotargeting, data and IP address targeting, and website or app targeting to take a more refined approach.

Cost-effectiveness: Advertising budgets are used more efficiently. Advertisers have better control over how much they pay to reach a specific audience and can focus on maximizing the return on their ad spend.

Measurability: The success of the ads is easily measured with the analyzed data, which makes campaigns more efficient over time.

Is programmatic advertising right for you?

If you are looking for more targeted, more measurable and more effective results from your digital advertising, programmatic buying is worth evaluating. What it contributes, however, depends on how clearly the audience is defined, which inventory is selected and how sound the measurement setup is.

Moon Workshop treats programmatic buying as part of a single strategy alongside Google Ads and other performance channels. You can reach us through the contact page to review your current setup.