Programmatic 101: Breaking Down the Buzzword

Written by Leslie Lee

Mar 5, 2019

Programmatic 101 - Blog 1

Programmatic – it’s a hot topic and one of those buzzwords that you’ve probably heard used by countless people… who may or may not actually know what it means. With a growing interest in ways technology can advance out-of-home media, many are trying to learn about “programmatic” and what it could offer to the digital out-of-home industry. To help simplify these conversations, we’ve broken out the core elements of programmatic into a three-part series: Programmatic 101.

What is it and why do I care?

The word “programmatic” refers to the automation of buying and selling advertising through software. This is often executed via an auction-based marketplace, also known as an exchange.

Essentially, publishers provide available inventory discoverable at the individual impression or spot level. Buyers can evaluate and bid on that inventory in real-time, based on certain business rules such as audience criteria, price and more.

Programmatic technology has revolutionized the online advertising world and is now bringing some of the same benefits to digital out-of-home. 


Benefits to Sellers

Programmatic platforms provide media owners (sometimes referred to as publishers) with aggregate demand, by offering inventory to a large set of buyers through a streamlined access point. Media owners can make inventory discoverable in an instant by leveraging a programmatic exchange. This also enables media owners to access programmatic advertising groups beyond the standard channel buyers (think: digital buyers, agency trading desks, etc.), creating a new revenue stream.

Thanks to this large connection to demand, programmatic helps monetize unsold inventory. Through a channel that requires minimal effort, media owners can expose unsold inventory to digital buyers for bidding, effectively maximizing the yield on their full network.

Programmatic technology allows media owners to curate inventory by segmenting target audiences. By surfacing inventory that best aligns with specific audience goals, media owners can justify increased advertiser spend as the campaigns will be reaching the intended customers with greater efficiency.


Benefits to Buyers

On the other side of the equation, programmatic buying platforms offer digital buyers access to aggregate supply. This means advertisers can view a full ecosystem of inventory, instead of navigating individual transactions across a fractured media landscape.

This streamlined buying process eliminates the need to manage individual contracts and IOs. The more efficient workflow that comes with programmatic means that buyers can execute large-scale media programs with much smaller teams.

Furthermore, programmatic allows for the use of data to inform buying decisions across those large-scale media programs. Programmatic technology leverages data to assess every ad placement at the impression/spot level, for truly data-informed purchasing.

Finally, centralized buying through programmatic platforms allows marketers to apply an overarching measurement solution, providing clearer performance and impact insights through aggregated measurement.

Programmatic provides buyers with the centralized purchasing process they want, with better transparency into budgets and campaign performance.

Core Technology Components

Now that we’ve established the main benefits that programmatic technology brings to buyers and sellers, let’s take a look at the core components that actually enable this all to work.

There are 5 key technical elements, and they all perform unique functions that contribute to the workflow of programmatic advertising.  

Vistar_Tech_Stack_Components

In our next post, we’ll define the role each of these play in the flow of digital out-of-home advertising through a programmatic system and walk through that process step-by-step to show the full experience from brand to screen to consumer.

Ready to learn more about how you can leverage programmatic digital out-of-home? Download Vistar’s Digital Out-of-Home Primer for Success:

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Topics: Education, Programmatic