You can't really make a list of buzzwords in ad tech, or digital advertising in general, that doesn't include the word "programmatic." Programmatic advertising is all the rage right now, and there's something real behind the hype. Done right, this automated ad buying and sales method saves time and increases programmatic revenue.

Sure, programmatic advertising is a big deal. But does that mean the days of direct ad buying are over? Absolutely not. Direct ad buys are still a viable and profitable way for publishers to bring in revenue and for advertisers to get their messages in front of the right people (and in their preferred digital ad format).

So, in the direct vs programmatic ad cage match, who is still standing at the end of the night? A simple answer would be nice, but that isn't the way ad tech works. There's nuance here, and we discuss it below.

Playwire helps publishers maximize their revenue through programmatic and direct buys. To get your custom revenue amplification roadmap, reach out to Playwire today.

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Programmatic Advertising: What Publishers and Advertisers Need to Know

Read the guide and stop wasting revenue on programmatic done wrong!

Benefits of Programmatic Ads

 

 

What is programmatic advertising?

It's a highly complex process that can be summed up rather simply - it's digital advertising, mostly automated. Programmatic advertising doesn't take humans completely out of the advertising equation, but it does reduce the need for people who directly purchase ads or sell ad inventory. With programmatic, there's less negotiation, no insertion orders (IOs), and no requests for proposals (RFPs). However, even mid-sized programmatic ad campaigns and inventory sales require a human touch to manage them in a way that maximizes revenue.

Although the actual execution of a programmatic ad campaign is not at all simple, the concept behind programmatic advertising is all about simplifying the advertising process. No more direct negotiations, invoices or insertion orders (IOs).

In many ways, programmatic is easier than IO-based buys. Advertisers provide their desired target audience, creative and estimated budget, and publishers provide their ad inventory. Money flows through the system organically. Ads are served automatically.

Then, you have the fact that programmatic is the predominant method of advertising today. That means selling or purchasing ad inventory programmatically provides greater access to what you're looking for, whether it's programmatic revenue for the publisher or ad impressions for the advertiser.

Benefits of Direct Buying

 

 

What is direct buying?

Direct buying is when an advertiser or brand directly buys advertising on your website, rather than purchasing impressions digitally via an exchange. Direct sales requires a team of sellers to attract brands and an ad operations team to manage the directly sold campaigns.

What does direct buying have that programmatic buying doesn't? A few things, but it's mostly about the ability to customize. The whole point of programmatic advertising is speed and efficiency, but that leaves little room for customization.

If you're an advertiser who wants the big, splashy custom ad units and sponsorships that really turn heads (or a publisher who wants the big revenue that comes with those kinds of premium inventory), and have the ad spend to do it, that will happen in the world of direct buys.

Direct buying also opens up publishers' ability to get access to big brand advertising dollars that are hard to come by in the programmatic world. Big brands often like to work on direct deals with their publishers of choice, and getting direct buys from big brands is probably every publisher's dream. In addition, direct deals typically come with a much higher dollar value per ad impression for publishers.

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Programmatic Advertising vs. Direct Buying: it isn’t One or the Other

Here's the thing: programmatic advertising vs. direct buying sends the wrong message. In most cases, you aren't looking at one or the other - you really should be using both. For many publishers, there are benefits to gain from both programmatic and IO ad sales.

Unfortunately, most publishers don't have the time or the resources to pursue both programmatic and direct deals with the full force necessary to be successful in both arenas. For publishers with limited bandwidth, it often is one or the other, out of necessity. However, there's an intermediate option that marries both programmatic sales and direct sales: programmatic guaranteed.

In programmatic guaranteed advertising, ads are delivered automatically, but IO-based methods are still front and center:

  • Publishers and advertisers still negotiate over pricing.
  • As is the case in IO buys, campaigns have set beginning and end dates.
  • Publishers set aside ad inventory for certain publishers, which is almost the same way it's done in direct buys.

The purchase and serving of the ad is still programmatic, giving you the attractive automation benefits of programmatic. With programmatic guaranteed, the approach isn't so much about programmatic advertising vs. direct buying - it's more like programmatic plus direct buying equals increased programmatic revenue.

In addition to programmatic guaranteed, there are a few other types of programmatic advertising that are more of a "blend" with some of the benefits of direct ad buying:

 

 

Programmatic Preferred Deals

With a programmatic preferred deal, publishers agree to provide specific buyers preferential access to their inventory, but that access is not reserved - or guaranteed - only for that buyer.

 

 

Private Marketplace Deals

Private marketplaces (PMPs) are similar to open ad exchanges, but they're a lot less "open." These programmatic PMPs allow a limited set of buyers (or just one buyer) to have access to the inventory of an exclusive set of publishers.

The Future of Programmatic and Direct Buys

While it's important to consider the benefits of direct buying vs. programmatic advertising, this question may become more or less obsolete in the near future. Why? Because direct buying and programmatic are starting to blend together.

This isn't an active effort to merge the two ad sales methods. Instead, it's a gradual coalescence driven by advertising technology . For ad tech to make advertising better for both publishers and agencies, the previously unique benefits of IO buys and programmatic ad buying need to come together to form a better method. And they have.

Here's just one example of many: if you were to take a look inside many agencies today, you would see programmatic media buying professionals using supply path optimization (SPO) tools. Essentially, SPO tools enable agencies and advertisers to find the most direct line to a publisher's inventory.

Agencies don't want to just buy display ads from the same sites in 15 different places (and probably pay 15 different prices for that inventory). They want to buy the inventory from one place and for the best price. SPO tools enable this by minimizing the number of intermediaries between the agency or advertiser and the publisher in the media buying chain.

Is that starting to sound like a direct buy to you? As ad tech advances, the cons of programmatic deals and direct buys will fade, and the pros of these methods will merge even more than they already have.

Understanding Direct and Programmatic Buying

Want to dive deeper? Get a better understanding of how both direct and programmatic advertising work with these resources:

Programmatic Advertising:

Direct Sales:

Playwire: The Best of Both Worlds

Programmatic advertising vs. direct buying is a topic the team at Playwire thinks about a lot, but we like to look at it on a granular level. In other words, what combination of programmatic and direct advertising sales will help a particular publisher bring in the most revenue possible? The answer is often different for each publisher.

At Playwire, this is what we do. We maximize publishers' revenue. With Playwire's revenue amplification platform and world-class team of experts, you don't have to worry about how you're going to sell your inventory and bring in revenue. We take care of the entire process so you can get back to making the incredible content your audience loves. To learn more, reach out to us. Give us a call at 561-206-4621 or contact us online today.

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