Advertisement industry is complex.
There are already a few known methods to sell and purchase ad space (inventory); more are being added to it.
The complexity can be understood by the fact that each method includes numerous units (such as ad exchange, ad networks, supply-side platforms and demand-side platforms).
When these units work together, things start falling in place for publishers and advertisers. One of the core methods for publishers to deal with their inventories is programmatic direct which we are discussing here.
Programmatic Direct is a direct deal between seller and buyer, eliminating the need for ad exchange parties. Again, the publisher invites buyers but there is no bidding involved.
Mainly, it’s a subset of programmatic advertising which is accompanied by two other types.
Here’s a brief on each:
1. Real-Time Bidding (RTB): This is a completely automated process where publishers submit their ad space for sale and advertisers place their bid in real-time. The highest bidder gets the inventory to display ads. And this entire process takes less than a fraction of a second.
2. Private Marketplace (PMP): PMP is more like an invitation based RTB. here, publishers invite specific buyers to bid on their inventory. And exactly like RTB, the ad space is purchased and ads are displayed in real-time. PMP is more private and secure than RTB.
Since you’re here to know more about programmatic direct, let’s dive deep into it.
Q.1) What Is Programmatic Direct?
Here, an advertiser gets an invite from the publisher directly to purchase his inventory on a negotiated price for a fixed time interval.
Programmatic direct enables advertisers to get guaranteed ad impressions by displaying ads on the publisher’s premium web pages (home page or landing page). Both the parties sit together to agree on a fixed CPM and close the deal.
For publishers, it’s a great opportunity to sell their premium inventory to only interested buyers. And for advertisers, their ads can reach to a specific audience by purchasing inventories offering guaranteed impressions.
Let’s understand this with an example:
Suppose, an ad tech publisher has clubbed a science lesson section on his site. Next, a university targeting science students want to display ads to them. This can be a perfect opportunity to be utilized by programmatic direct. Moreover, if the university wants to target the 18-25 age group specifically, even that’s is possible.
Q.2) How Is It Different From Other Programmatic Deals?
Programmatic direct model may sound similar to the private marketplace (PMP) but they have multiple differences. In case of programmatic direct, the advertiser and publisher agree on a fixed CPM rather than multiple advertisers bidding for the inventory.
Unlike other programmatic deals, direct deals offer guaranteed agreement. Moreover, the advertiser gets fixed number of impressions at a fixed price. Most importantly, publishers know to whom (advertisers) they are selling their ad spaces and advertisers know where their ads are being displayed.
A programmatic direct deal requires more human involvement than any other programmatic deals. In case of real-time bidding, the publishers put up their inventory for all buyers and the one with the highest bid gets to display the ad. Whereas, programmatic direct deals are cozier and include negotiation.
Q.3) What are the Pros Of Programmatic Direct?
Programmatic direct is good idea for you (publisher) if you want the control in your hand. Especially on the landing page and homepage of the site where a publisher wants complete authority.
Quality and control have to be the reasons why sellers and buyers admire this method. Here’re some benefits of programmatic direct:
1. Quality: All an advertiser wants is quality impressions on his ads. And programmatic direct ad provides quality impression where the audience can be targeted based on demographics (location, age, gender, preferences, education, and more). In return for such inventory, advertisers pay a good price.
2. Control: Here, publisher gets complete command over the ads that are being displayed. Not just type of ad but also the physical distribution on the webpage. And for advertisers, it becomes easy to plan campaigns when they are getting sure-shot impressions for fixed time period.
3. Security: By offering their inventory to specific buyers, there is almost no chance of malvertisement. As the entire process occurs in a single system, programmatic direct simplifies sales and reduces the scope for human error.
Q.4) Are There Any Cons Of Programmatic Direct?
Yes, nothing is perfect. Even the fastest-growing and buzz-causing programmatic direct has some drawbacks.
1. Can’t Sell All Inventory: Surely, programmatic direct sounds like a great option to maximize yield from digital inventory while maintaining the security. However, a publisher cannot sell all the ad spaces using this method.
Simply, because advertisers are not going to purchase them. Programmatic direct is an ideal method to sell only the exclusive and high yielding inventory.
2. Not Flexible: A publisher and an advertiser have to agree on a fixed price for a fixed time interval. Once the deal is done, neither can make changes even if the ads are not getting as many impressions as they were supposed to.
3. High Threshold: For small advertisers, it can be hard to get hold of such exclusive inventory because a.) they won’t be invited by the publisher and b.) even if they are invited, they might not be able to pay high prices set by the publisher. Hence, they choose easier methods like RTB over the private auction.
Q.5) How To Get Started With Programmatic Direct?
Using Google Ad Manager, programmatic direct deal can be carried out with a few clicks. In a simple way, the publisher starts a programmatic direct deal and the buyer can accept the terms.
Both parties should agree to the Google Ad Manager Policy to continue.
Here’s is how a publisher can set up programmatic direct:
Step 1: Enable And Configure Programmatic Direct
Before you get started, make sure you have an Ad Exchange Account with Google Ad Manager.
- In Ad Manager, go to Admin > Global settings > Features.
- Toggle the Programmatic Direct button to turn it on.
- Save the settings.
Once you’ve enabled programmatic direct, it’s time to configure it. Configuring the deal will give you a name in the marketplace. And marketplace is where you’re able to find buyers.
Note: Once Programmatic Direct is turned on in your network, it can’t be turned off. The option is hidden after saving.
Step 2: Configure Display Environment For Campaign
Environment helps buyers to identify the channel (format of inventory) in which ads are going to be displayed. The available options to set environment are Display, Mobile App, and In-stream video.
There are things to keep in mind while configuring environment are; one Ad Exchange account can be linked to one or more environments. However, an environment can’t be linked to multiple Ad Exchange accounts.
Google Ad Exchange applies numerous restrictions to programmatic deals. These restrictions are to ensure the security of both sellers and buyers. The best way to avoid being restricted is to go along with Google Ad Manager Policy.
In the US, one in every two dollars spent programmatically now runs through a direct deal. Programmatic direct deals are embraced by both publishers and advertisers offering them more control and efficiency than other traditional methods.
Programmatic direct deals offer guaranteed results but can be hard to negotiate. Also, only selected buyers can participate in the deal which can create problems for the rest of advertisers to get quality impressions.
In totality, it’s difficult to predict that programmatic direct is the future of programmatic advertising. Considering the fact, real-time bidding and private auction are still thriving and make their way up in the charts.