Understanding Guaranteed, PMP, and Direct : A Guide to Programmatic Advertising Deals

Programmatic advertising has reshaped the manner in which organizations purchase and sell digital ad spaces. Through its automation, it allows marketers to buy ad spaces in bulk, in real time, and on several platforms, thereby saving both time and expenses. In America alone, programmatic advertising expenditures for 2021 stood at $79 billion, which is around half of every media budget allocated for running advertisements.

No matter the case, the domain of programmatic advertising consists of intricate terminologies and operations, for instance, programmatic shopping and private marketplace transactions that can be baffling to seasoned promoters. If you are new to programmatic advertising or looking to improve your existing strategy, it is important to understand the different forms of programmatic deals so as to ensure that you achieve the intended advertising goals.

In order to delve deeper into all the different types of programmatic advertising, such as programmatic direct, programmatic guaranteed, and programmatic PMP deals, they will be analyzed later in this write-up. When you are done reading this guide, you will have gained enough insight on how to create effective advertising partnerships.

Overview of Programmatic Advertising

Define programmatic advertising

Automated means buying and selling digital ad inventory via technology platforms. Algorithms and customer inputs help in real time to place relevant ads against available publishers’ inventories. There are four main types of programmatic advertising; they include :

• Real-Time Bidding (RTB) or Open Auction : Here, advertisers bid for ad impressions in real time through a demand-side platform (DSP).
• Programmatic Direct : This involves purchasing advertising space from publishers via an advertising marketplace by advertisers.
• Programmatic Guaranteed : This is a type of programmatic direct where the deal is at a fixed cost per thousand impressions (CPM).
• Private Marketplace (PMP) : an even more exclusive type of RTB where only select advertisers are invited to bid.

Let us take a closer look at the three major forms of agreements within programmatic advertising.

What is Programmatic Direct?

In programmatic direct, advertisers buy ad space straight from the publisher, leaving out the open auction. It is similar to traditional advertising, but it is notable because it happens in an advertising market through DSPs, SSPs, or ad exchanges.

Selecting between RTB programmatic and programmatic direct depends on the objective as well as available funds. Though costlier and less elastic compared to RTB, programmatic direct provides more clarity and security for the name. In addition, advertisers may select their publishing partners, thus guaranteeing that their ads are seen within a credible milieu.

What is Programmatic Guaranteed?

Programmatic guaranteed simply means an instance of programmatic direct that allows advertisers and publishers to fix a CPM. The price does change based on demand with RTB, while in programmatic guaranteed deals, it is preferred that a fixed price be offered, providing certainty to both parties involved.

As such, is programmatic guaranteed equivalent to programmatic direct? Not really. In essence, programmatic guaranteed is one of the many forms of programmatic direct, characterized by its price-setting mechanism.

Programmatic Guaranteed comes with various benefits, including :

• Increased access to high-quality advertising space : This gives advertisers an opportunity for customized advertisement placements that are of great quality.
• More clarity on the transactions : Advertisers feel more safe in their transactions because they involve less risk of fraud from unregistered sellers or placements not verified.
• The above makes it easy for one to control where their ads go by having an idea of where the ad will show and its cost.

On the other hand, it has its own disadvantages, like :

• Reduced volume : Unlike real-time bidding (RTB), which incorporates several advertisers bidding simultaneously, if these agreements are done differently, then they can’t be easily scaled up.
• Decreased adaptability : this is because there is no room for changes once a deal has been signed between both parties involved in the marketing campaign design.

What is programmatic PMP?

A private marketplace (PMP) is a peculiar type of automated advertising program in which only selected advertisers can compete for offers. It works similarly to an open RTB auction but restricts participation to other people only.

Advantages of PMPs over RTB and direct deals :

• Automated yet accessible : PMPs are similar to RTB but more restricted in terms of promptness.
• Targeting customers effectively : Advertisers get more direct access to the data about their audience, resulting in very effective and appealing campaigns.

But PMPs have limitations :

• Less scale : Ad impressions on PMPs are usually lower than those available through open auctions.

Programmatic Guaranteed vs. PMP

Although they share a certain exclusivity, programmatic guaranteed and PMP agreements are two distinct propositions that stand apart from each other. Programmatic guaranteed involves one-on-one deals between an advertiser and publisher so that there are constant pricing strategies as well as placement strategies. In competition with this, however, PMP deals tend to operate within private marketplaces that may involve several advertisers competing for high-end inventory where exclusivity meets competitive bidding.

Steps to Set Up a Programmatic Guaranteed (PG) Deal

The process of setting up a programmatic guaranteed (PG) deal entails some critical stages :

• Upload the details of your campaign : Plug your campaign details plus customer information into the DSP.
• Send out a Request for Proposal (RFP) : Reach out to a publisher with your campaign proposal.
• Negotiate terms : Discuss and conclude the particulars, including ad impressions, audience targeting, and run time.
• Choose your creatives : Select the ads and targeting options for your campaign.

Taboola and other similar third-party programmatic ad platforms allow advertisers access to exclusive stock and enable them to reach wider audiences through various publisher properties. With the availability of these platforms, setting up programmatic guaranteed agreements becomes much simpler and improves the efficiency of your campaign.

Conclusion

To build successful ad strategies, it’s essential to understand the different kinds of programmatic advertising deals, including programmatic direct, programmatic guaranteed, and PMP. Each type provides particular advantages and obstacles, depending on what you want to achieve.

Knowing these terms will enable you to improve your programmatic campaigns in accordance with your business goals. Also, you can upgrade your advertising with private marketplaces and programmatic advertising white label solutions for programmatic advertising that give you more control, transparency, and premium inventory.

While traversing through the world of programmatic advertising, use resources such as best practices and case studies so that the strategies employed are well-informed.