Glossary of Programmatic Advertising Terms

Programmatic Terms Defined

Ad Exchange

A digital marketplace where advertisers, publishers, and networks buy and sell advertising space like display, video, and mobile inventory. An ad exchange allows advertisers and publishers to use the same technological platform, services, and methods, and "speak the same language" in order to exchange data, set prices, and ultimately serve an ad.

Agency Trading Desk

A centralized management platform used by ad agencies that specialize in programmatic media and audience buying. Trading desks are typically layered on top of a demand side platform (DSP) or other audience buying technology. Trading desks attempt to help clients improve their advertising performance and receive increased value from their advertising. They also measure results and report audience insights to their clients.

Trading desks were created in order to give the client and the agency more control over ad placement. When working with an ad network, the client often has limited say over where the ad is placed. Working with a trading desk allows the client to direct where ad dollars are spent and more closely examine the results to optimize if necessary.

Audience Extension

Audience extension allows advertisers to target a premium site audience, which is often sold out, across other sites and platforms, such as DSPs, ad networks, or exchanges. Also known as lookalike modeling, audience extension allows a marketer to choose various characteristics from a known audience segment and target a new audience who shares those characteristics.

Brand Safety

Brand safety refers to brands wanting to ensure their ads will not appear alongside content or on sites that can damage their brand. For example, an airline would not want its ad to run alongside news of a recent plane crash. To ensure proper brand safety, targeting and measurement solutions exist to help verify, block and control certain content ad campaigns will run on. Brand safety tools are typically available in ad servers and ad exchanges.

Connected TV (CTV)

Connected TV refers to any TV screen that can be connected to the internet and stream digital video, whether individually (smart TV) or through an external device such as Roku, AppleTV, etc.

Data Management Platform (DMP)

A DMP is a centralized system for gathering first-party data, integrating with third-party data, and applying this data to one's advertising strategy. A DMP may offer the following features: estimating the likely reach for a user segment, measuring the lift from using data, acting as a financial clearing house between data buyers and sellers, and assisting publishers in monetizing data on their users. DMPs most commonly work with user data but may also work with contextual data or other types of data.

Demand-Side Platform (DSP)

A DSP is a buy-side platform that allows buyers of digital ad inventory to easily and more directly connect with sellers in a programmatic and real time environment. A DSP has access to the inventory and does the bidding for you in real time to allow you to buy impressions at the moment you need them. Data can be brought in to assess which inventory is most valuable to a client. 

Frequency Cap Restricting (Capping)

The number of times (frequency) a person can be shown an ad impression in a specific period of time.

In-Demo Measurement

The ability to measure the age and gender of exposed audiences to ensure advertisers are reaching the desired target audience. This type of measurement is often validated by 3rd party companies such as Nielsen.

Private Marketplace (PMP)

A PMP is a type of programmatic advertising that offers a real-time-bidding, invitation-only, auction environment for digital advertising that leverages online ad inventory. Because the marketplace is only available to certain providers and buyers, it is a closed system with exclusive inventory. This Inventory is bought and sold at an impression level and it is a one-on-one deal between the exchange provider and the buyer. It also allows the exchange provider to monetize their inventory more efficiently and place rules around who can purchase impressions. 

Programmatic Advertising 

Programmatic advertising refers to the automation of buying and selling digital media. Advertisers use programmatic technology to more efficiently buy on digital ad inventory, with less direct communication with people. It reduces much of the manual back and forth that come with the middle steps of buying and selling, including IOs.

Programmatic Direct

This is the automation of ad buys directly between a publisher and an advertiser for fixed budget campaigns.

Real-Time Bidding (RTB)

Bidding that happens via automated auctions on online ad inventory in real time. A real-time bid is often dynamically generated based on past performance of creatives, inventory, user groups, and other parameters. Real-time bidding also implies multiple bidding systems or exchanges making calls to each other in real time.

Supply-Side Platform (SSP)

The platform through which publishers sell their inventory in an ad exchange. Publishers set up their inventory through an SSP under certain descriptive qualifiers, whether it’s homepage or “above the fold” impressions. The SSP’s backend technology supports its ability to push that inventory into the ad exchange in real time.

Viewability

The metric which is used to track ad impressions that were actually seen by a person.

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