Marketers and advertisers have many different ways of getting their ads in front of target audiences. The sites an advertiser’s ads are placed during a campaign are picked up through the different exchanges, or marketplaces, where inventory is available. There are three main exchanges where digital advertising inventory is available to advertisers.
1. Programmatic Direct
Programmatic direct is inventory that is directly sold and guaranteed between an advertiser and the specific publisher site. This type of exchange brings together the automation of programmatic media buying with the traditional ad buying process. However, right now programmatic direct is only a sliver of the ad buying marketplace because inventory usually costs more due to top-tier inventory being sold at a fixed price with a set number of impressions. Though with this type of buy there is more transparency as advertisers see how much they’re paying and for what up front.
2. Private Marketplace
The second type of exchange is the private marketplace. A private marketplace, or PMP, is an invitation only RTB auction where one or a select number of publishers invite a select number of buyers to bid on inventory. The inventory is transparent and allows for both parties to skip the exchanges altogether. The inventory transaction itself is in an auction, but the terms of the deal are pre-negotiated between the buyer, seller, and approved advertiser. Many choose to use PMP for a specific brand initiative instead of just generating conversions. While it is not as exclusive as programmatic direct, it still takes more time, labor, and often more money than our third marketplace, the open marketplace.
3. Open Marketplace
In an open marketplace, there is inventory from multiple exchanges where advertisers can bid to purchase ad impressions. In this market, everyone has the same opportunity at purchasing the same inventory – the open marketplace is a total “free for all.” The majority of inventory lives in the open marketplace as ad exchanges will hold an abundance of inventory from hundreds of thousands of different sites. Often in the open marketplace, advertisers will purchase inventory available by using category keywords and sites or geolocation to narrow down the amount of inventory available to only those relevant to the campaign.