This blog series was created in collaboration with BrightRoll, the leading platform in programmatic video advertising. Learn more about their solutions for publishers.
2015 has been deemed the “Year of Video”, largely supported by the explosive growth in digital video advertising. As the media, brands, and publishers discuss digital video ad trends, programmatic is at the forefront of this conversation. While programmatic video may be a familiar term, many are still not entirely confident about what it is or how it applies to them. For publishers thinking about joining the programmatic market, it’s important to understand what programmatic is, who are the key players, and why it’s the most effective method to monetize video content. Understanding these factors will build confidence in publishers to better optimize their ad inventory through programmatic methods, and subsequently increase revenue. That’s a tough deal to turn down, so let’s jump into it.
What is programmatic?
At its most basic, programmatic refers to the use of software to automate the selling of digital advertising. Traditionally, publishers have used RFPs (requests for proposals), person-to-person negotiations, and manual insertion orders to sell video ads. Programmatic selling represents a new way. Here are three qualifying questions to identify programmatic video transactions. If you can answer “yes” to all three of these questions, it’s programmatic:
Are impressions bought and sold in an automated way? Automation enables individual-impression selling and real-time bidding. Impressions can either be sold through an auction, or at a pre-determined minimum price.
Can you leverage data for better inventory optimization and to extend your audience reach? It’s possible to leverage data in traditional selling, but a programmatic platform should give you control over many combinations of inventory management parameters. For example, you might fine-tune your price floors, create custom allowances for specific advertisers, or open video ad inventory to supplement demands from similar sites.
Is inventory evaluated at the individual-impression level? If impressions are evaluated and trafficked in blocks, they aren’t programmatic. Programmatic enables direct access between individual ad impressions and more demand sources across all major ad segments to optimize yield.
Who’s involved in programmatic?
Meet the Programmatic Ecosystem
The Sell Side
Let’s start on the sell side. These are the players offering video inventory to generate ad revenue.
Publishers — creators of consumer experiences in websites/mobile sites/mobile apps with video inventory space. Publishers monetize their content by providing this inventory for sale.
Supply Side Platforms (SSPs) — software used by publishers to make their inventory available for sale and to help maximize their revenue potential.
The Buy Side
On the other end of the equation, we’ve got the buy side. These are the players seeking out video inventory to buy.
Advertisers — companies who want to put their message in front of target consumers, in order to build awareness, change perception, and sell products or services.
Agencies — companies who work with advertisers to plan, create, execute, and monitor and measure advertising campaigns.
Ad Networks — companies who work with publishers to aggregate and package inventory for sale to advertisers and agencies.
Agency Trading Desks (ATDs) — organizations that centralize media buying, typically display and video, within a large agency holding company to drive volume discounts and efficiency in media execution. There are only a handful of ATDs since there are only a handful of large agency holding companies.
Demand Side Platforms (DSPs) — software used by agencies, advertisers, and advertising trading desks to buy video advertising in an automated way.
Ad exchanges are neither buy-side nor sell-side — they function exactly in between.
Ad Exchanges — marketplaces that connect publishers to buyers, DSPs, and other “buyer” demands, often in real time.
These impartial providers help players on both sides (buy and sell) to make informed, optimized decisions. Publishers typically use an SSP to put this data to work.
Third-Party Data Aggregators — organizations that pre-package audience segments from publishers and sell to buyers to expand audience reach. Some third-party data aggregators can help you transfer offline data to your digital platform.
Data Management Platforms (DMPs) — companies who manage data on behalf of advertisers and publishers.
Why programmatic video?
Programmatic video ad spend is expected to triple in 2015, and is the fastest growing area of programmatic investment in the US. If you have video inventory today, you need to understand how programmatic technology works, and how it can support your video monetization. If you don’t have video inventory, or have a minimal supply, start thinking about how you can increase your publications video inventory.
In addition to the increasing opportunity that programmatic video promises, there are certain benefits that programmatic ad networks bring to publishers. Top programmatic video advertising platforms will support publishers in the following ways:
- You can sell ads on the single-impression level, securing greater value for every impression.
- You can leverage first-party and third-party data together, while supplementing video ad inventory on similar sites to meet growing demands.
- You can manage content channels with a third-party provider, to determine which content is offered.
- You can oversee consumer experience of your content, using demand source and content blocking on all devices including mobile screens.
- You get better visibility across your transactions, with clear insight into advertisers, pricing, and volume.
- You control how your inventory is filled, including ad placement, geotargeting, and creative management (specifically the ability to identify bad creative).
- You can be agile, making adjustments for better yield optimization as needed.