By Dirk Jacobs, Managing Director, Gamma
We recently worked with a major publisher in the Philippines on a private marketplace (PMP) deal, which they wrongly assumed was a programmatic guaranteed deal simply because these terms are thrown about interchangeably all the time.
More confusion is in store. The influence of advertising technology on the marketing industry is going to continue to grow, and as products and solutions evolve what was programmatic yesterday won’t be tomorrow.
Today, marketers and publishers must understand the often-confusing terminologies and definitions if they want to be a part of this high-growth space. Here’s a look at the terms that are essential to know in 2018.
Private Marketplace (PMP): A private marketplace, or a private deal, is an invitation-only auction that is only open to handful of advertisers. This kind of deal means publishers have more control, and advertisers have greater transparency into inventory.
Sitting within the private marketplace are a couple of types of deals:
a) Private Auction: A private auction gives a select group of advertisers priority to inventory before it becomes available in the open marketplace (see below).
b) Preferred Deal: Preferred deals take place when publishers make a deal with a fixed-price CPM to one specific buyer.
Programmatic Guaranteed: Also known as programmatic direct, programmatic guaranteed gives advertisers access to premium inventory while also allowing them to overlay first-party and third-party data. It’s a win-win situation where buyers choose which audience and impressions to bid on while publishers are guaranteed a certain level of pricing.
It’s important to distinguish programmatic guaranteed from automated guaranteed, which is a deal that’s negotiated directly between a buyer and seller, and where both inventory and pricing are guaranteed.
Open Marketplace (OMP): An open marketplace is an online marketplace where several media owners offer their ad inventory for sale to buyers, often through real-time auctions.
Demand-side Platform (DSP): Software that allows media buyers to purchase ad placements through bids in ad exchanges.
Supply-side Platform (SSP): Software that helps publishers sell their inventory to the highest bidder via ad exchanges.
Data Management Platform (DMP): One of the important by-products of rising digital investments is data that marketers are unable to make sense of. A data management platform is software that sorts and houses all this data, filtering it down to what’s useful for marketers and publishers.
Trading Desk: Trading desks are focused on the buying and selling of ads on behalf of their clients using technology.
Remnant Inventory: Remnant inventory is non-premium inventory that is usually sold at a discounted rate.
Real-time Bidding (RTB): Although it’s 2018, we still see confusion around real-time bidding. Simply put, RTB is the buying and selling of digital ads through computer-run auctions that take place in a matter of milliseconds. It’s important to note that an RTB is not an open marketplace or open exchange.
Programmatic terms are commonly used in the more mature markets of Europe and the US. But in Southeast Asia, where ad technology adoption is only just growing, programmatic advertising remains a muddle of confusing acronyms. Though we’re happy to help shed light on these terms, we believe that it’s up to the IAB to work with advertisers, publishers and technology providers to create a definite list of definitions that helps propel the industry forward.