Programmatic advertising comes in many forms. Each one helps publishers better sell ad inventory across platforms, while also helping advertisers reach target audiences at scale.
In fact, that’s why programmatic native and display spend is on the rise. As Statista reported, programmatic advertising spend reached $155 billion in 2021 — up from just $68 billion in 2017.
It’s important for publishers and brands to understand the different types of programmatic advertising so they can find the most effective strategies for their campaigns and goals.
Let’s look at direct advertising, in particular.
What is programmatic direct advertising? It’s the process of buying ads directly from publisher partners. Unlike traditional advertising, these ads aren’t delivered manually. They’re distributed programmatically through a demand-side platform (DSP), which uses data and algorithms to help identify the best ad placements.
When it comes to real-time-bidding (RTB) programmatic vs. direct programmatic, there are a few key differences. With RTB, advertisers bid against each other for impressions in a digital auction. With direct advertising, publishers and advertisers work together on a one-to-one basis, setting a guaranteed number of impressions at a fixed price. So RTB placements can be more scalable and affordable, but direct placements can be more high-quality and brand-safe.
That’s just the tip of the iceberg, though. Programmatic direct can also be divided into a few different types, each with its unique benefits and drawbacks.
To help publishers and advertisers understand all that direct advertising has to offer, we’ll explain:
- Programmatic Direct vs. Programmatic Guaranteed
- How Does Programmatic Direct Work?
- Types of Programmatic Direct Advertising
- Pros and Cons of Programmatic Direct for Publishers
Programmatic Direct vs. Programmatic Guaranteed
First, what is direct buying vs. programmatic guaranteed? Simply put, programmatic guaranteed is one form of direct buying. With programmatic guaranteed, a publisher and advertiser decide on a set CPM (cost-per-thousand-impressions) and delivery window. The advertiser then guarantees to buy the ad placement based on that CPM.
Publishers might use programmatic guaranteed to lock down revenue from a trusted, relevant ad partner. And advertisers might use this form of programmatic direct to lock down a certain number of impressions in a vetted, brand-safe environment.
How Does Programmatic Direct Work?
Programmatic direct ads are purchased on a one-to-one basis. How do you actually buy programmatic advertising directly? Typically, a publisher contacts an advertiser through a DSP — or vice versa — and proposes a certain ad inventory package at a fixed CPM. From there, the publisher and advertiser negotiate until they reach a mutually beneficial deal. The advertiser then runs their campaign programmatically, reaching the right audiences at the right time through the publisher’s digital property.
Here’s an example. A fitness blog is selling ad space on its website. They reach out to a popular athletic-wear retailer, offering an opportunity to run ads at a fixed CPM in front of its built-in, engaged audience of fitness enthusiasts. They negotiate a deal and the advertiser launches its ads through its DSP. As a result, the publisher gets to monetize its content with a hand-picked ad partner, and the brand gets access to premium publisher inventory at a predetermined price.
Through their DSPs, advertisers can also expand their reach by syncing up with platforms like Taboola. As the world’s largest content discovery platform, Taboola has direct integrations with the world’s leading DSPs, including Google’s DV360. This means programmatic advertisers can tap into our network of over 500M daily active users across 9,000 publisher partners.
Types of Programmatic Direct Advertising
There are three main different types of programmatic direct advertising: private auctions, preferred deals, and guaranteed deals.
Here’s a closer look at what they each entail.
Private Auctions
A private auction or private marketplace (PMP) is like an RTB auction but it’s invite-only instead of open to all advertisers. So advertisers use private auctions to bid on programmatic placements in real time, but they’re among a more exclusive group of bidders. Also, private auctions may set a minimum bid for participants.
Taboola, for example, offers a range of PMP deals, including:
- Prime with Taboola for luxury native display ads
- High Impact Placements across top-tier editorial publications
- Views with Taboola for 100% viewability guaranteed
Preferred Deals
A preferred deal is a one-to-one negotiation between a publisher and advertiser, wherein they agree on a fixed CPM for a programmatic placement. Still, the advertiser is not locked into purchasing the inventory. They get an exclusive opportunity to buy first — and directly from the publisher — but they can ultimately decide to walk away if the deal doesn’t work for their campaign goals.
Guaranteed Deals
A programmatic guaranteed deal is like a preferred deal, but the advertiser is guaranteed to follow through and buy at a fixed CPM. So the advertiser gets access to premium inventory at an agreed-upon price and volume, and the publisher gets a guaranteed stream of revenue.
Pros and Cons of Programmatic Direct for Advertisers
Programmatic direct buying has its advantages and disadvantages. It’s important for advertisers to understand the ups and downs of these one-to-one deals, so they can make the best decisions for their business needs.
The biggest benefits of programmatic direct for advertisers are:
- Quality control. Advertisers can hand-pick and vet publishing partners, ensuring only high-quality placements across trusted editorial sites.
- Security. Advertisers can weed out risky inventory and reach target audiences in brand-safe environments.
- Guaranteed impressions. Instead of competing against others bidders in a real-time auction, advertisers will know they’re getting guaranteed reach at a fixed price.
Meanwhile the risks of programmatic direct buying include:
- Not as scalable. Direct deals can take more time to execute, so may have trouble scaling their reach with this method.
- May be difficult for small advertisers. Small and newer advertisers may have a tough time forging exclusive deals with high-end publishers if they’re just getting their ad operations off the ground.
Conclusion
Programmatic direct deals may become more popular as publishers attempt to crack down on ad fraud and advertisers seek to improve brand safety. Still, RTB offers scalability and cost-effectiveness for advertisers looking to expand their reach across the open web.
However you choose to create your programmatic display or native ad campaigns, you can consult our Programmatic Creative Best Practices and data-backed case studies for guidance. Also, check out our how-to guides for creating a native display deal through Google’s DV360 and creating a programmatic deal through The Trade Desk.
Ready to launch your next programmatic campaign now? Get started with Taboola.