programmatic advertising ppt

1. PROGRAMMATIC
ADVERTISING
APRIL 6, 2017

2. WHAT WE’LL COVER TODAY
Demystifying programmatic advertising
Avoiding pitfalls that will hurt your revenue and reputation
Opportunities to grow your revenue

4. ‘PROGRAMMATIC’ DEFINED
Programmatic Advertising is the automation of
advertising/media transactions. This typically
involves machine-learning decisioning and both
biddable and non-biddable inventory, but
currently relies on human input to create rules for
both the buy and sell side.
Some examples of programmatic:
Ad Networks
Search
Real Time Bidding
Automated Guaranteed

5. IN A FRACTION OF A SECOND....
PROGRAMMATIC PROCESS
Visitor Enters
Website
Exchange Notifies
Bidder
$11.00 Bid
$10.50 Bid
$10.00 Bid
Visitor Sees Ad
1. Visitor A accesses
site, server requests
an ad from the ad
exchange
2. Advertisers given visitor
details, publisher site and
ad unit info
3. Advertisers place
different bids based on
what they appear the
value of Visitor A to be.
4. Ad Exchange selects the
highest bidder and sends
creative to the publisher
5. Visitor sees creative
and an impressions is
counted
Ad Exchange
Real-Time Bidding
Advertiser A
5
Advertiser B
Advertiser C

6. PROGRAMMATIC EXPLAINED
Reservation
Buying
Ads sold directly
between
advertisers/agencies
and publishers
manually
Then
Direct Sold/
Guaranteed/R
eserved
Private
Exchanges &
Automated
Guaranteed
Exclusive advertiser-to-
publisher inventory
relationships for
programmatic
purchasing in brand
safe environments
Programmatic
Premium
Now
DSPs
Bidding technology
designed to help
advertisers/agencies
target and optimize
their buys across
multiple ad
exchanges/publisher
inventory pools
Ad Exchanges
& SSPs
Real-time
marketplaces with a
large pools of liquid
inventory not sold in
direct buys; SSP’s
have more controls
for publishers to
optimize yield
Indirect/Progra
mmatic/
Unreserved
Ad Networks
Ad networks aggregated
inventory and sold it to
advertisers. Helped
publishers by selling
inventory they could not
sell themselves.

7. PRIORITIZATION IN THE AD SERVER
7
PREMIUM
DIRECT
PREMIUM
PROGRAMMATIC
STANDARD
DIRECT
OPEN
PROGRAMATIC
> High CPM and yield
> Direct Demand
> Non Standard
> High Volume
> Guaranteed Delivery
> Prioritized remnant
> Repackaged media
> Audience Extension
> Undifferentiated
media
> Demand-Supply
imbalance
a.k.a. “The Waterfall”
PREMIUM
DIRECT
STANDARD
DIRECT
PREMIUM
PROGRAMMATIC
OPEN
PROGRAMATIC
> Sponsorship
> Custom Executions
> Context Targeting
> Audience Targeting
> ROS & RON
> PMP
> SSP
> Ad Nets
Typical Publisher

8. WHY IS RTB GROWING SO FAST?
From past to present
Buyers
Sellers
Past Present
Execution Transparency
Cheap Media
High liquidity
High ROI on Direct Response
Scale
Data Collection
Transparency
Access to premium inventory
Contextual Relevance
Operational + Media efficiencies
Flexibility in planning
1st party data access
Yield Management
Revenue for unsold media
Sales Channel Conflict
Transparency
Premium Environments
Control
Scale
Operational Efficiency
Higher Yield
1st Party Data Usage

9. PROGRAMMATIC AD USING THIRD PARTY DATA
Targeted based on Audience Data to a golfer, on
Bloomberg.com
9

10. BENEFITS/CHALLENGES OF PROGRAMMATIC FOR
ADVERTISERS
The top benefits of programmatic buying are:
• Better targeting
• Real-time optimization
Meanwhile, the top challenges are higher bot fraud and potential for non-
viewable ads. Transparency issues also are identified as challenges:
• Lack of transparency to the costs within the programmatic supply chain,
i.e., only $.30 to $.40 of every dollar actually buys media
• Lack of transparency into the firms along the programmatic supply chain,
i.e., not knowing all the firms that are touching my business

11. PROGRAMMATIC DEMYSTIFIED
Advertisers want more control over which ad impressions to buy
The market has shifted from buying all impressions on your website to
buying those individual impressions that fit their needs
They are using first party and third party data to better understand who is
loading a web page

12. MARKETPLACE
/EXCHANGES
ACTORS & ACRONYMS
What role each plays in the open auction ecosystem
12
ADVERTISER
/
AGENCY
PUBLISHER
DSP
AGENCY
TRADING
DESK
SSP
SERVICES
DMP
PUBLISHER
AD
SERVER
SERVICES
DMP

13. HEADER BIDDING
Header bidding allows publishers to receive bids from every partner
simultaneously so the impression is always awarded to the highest bidder
Header bidding increases ad revenue significantly, requires less ongoing
maintenance, facilitates more accurate reporting and results in fewer
discrepancies
Another great aspect of header bidding? It’s low maintenance. While a
traditional waterfall setup requires near-constant attention, header bidding
allows for a “set it and forget it” approach
In most cases, publishers traffic their line items once and then simply monitor
performance

14. Your Site
10,000
Impressions
YOU CAN SELL INVENTORY YOU DON’T OWN

15. SUCCESSFUL PARTNERSHIPS
Trust
• Intentions
• Collaboration
Transparency
• Deal Points
• Business
• Auction
Desire for Mutual Success
• Understand the other side
• Outcomes
15

16. DEALS DONE RIGHT FOR PROGRAMMATIC
Standard Discussion
• Strategy
• Objective & Measurements of success
• Daily desired spend
• Price
Advanced Discussion
• Campaign parameters
• Unit winning price and/or closing price
• Preferred context
• Publisher Set up
• Creative type & vendor
• Reporting requirements
“The power sits neither with
the buyer or the seller; it
rests in the effectiveness of
the deal because both
parties are equally
responsible for its success”

17. TERMINOLOGY: THE PAINFULSTUFF
RTB
Real Time Bidding –the technology that allows the selling and buying of
inventory one impression at a time, i.e. Biddable Inventory
Machine Learning
The use of algorithms leveraging large quantities of data to maximize
efficiency and/or improve effectiveness of a desired outcome
Ad Exchange
Transparent real-time marketplace where large pools of inventory are
bought and sold. Now uses RTB to transact
DSP
Demand Side Platform - Technology company that powers RTB
buying for advertisers and agencies. Leverages buy side decisioning
SSP
Supply Side Platform - Technology platform that powers RTB selling
for publishers. AKA a ‘publisher biased exchange’.
PMP
Strategy to create a premium channel using RTB to execute direct
buys, aka Private Exchange. Uses Deal ID technology
Automated
Guaranteed
Workflow automation and execution channel for direct sold reserved
inventory. AKA Programmatic Guaranteed
Bid Request/
Bid Response
Action in auction where SSP solicits all requests for bids, and DSPs
respond with bids, one impression at a time

18. TERMINOLOGY 201: THE PRO STUFF
Floor/Fixed
Price
Floor is the lowest price an advertiser will pay in a
second price auction. Fixed price establishes a
maximum. Mutually exclusive
Bid Response
Rate
The rate at which a DSP responds to bid requests with
>$0 bid responses
Bid Price
The first or fixed price bid that represents the maximum
amount a buyer will pay for the impression
Win & Clear
Prices
Win is the first price, clear is the ‘pay’ price to the media
owner (in a second price auction). With fixed price,
these are the same
Win %
The rate at which a buyer’s bids are awarded an
impression
Bid Metrics
All the above together are called Bid Metrics. Use bid
metrics to study the auction for deal improvement or
incremental yield
Header
Bidding
An approach to auction management that allows
simultaneous bids from more demand sources into the
ad server for pub side decisioning