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Programmatic Advertising

Definition - What does Programmatic Advertising mean?

Programmatic advertising automates the process of targeting ad buys. Real-time auctions create algorithm-driven purchases for sets of ads in different channels and locations. Programmatic advertising dramatically changes the ways that marketers select venues for digital ad placement.

Techopedia explains Programmatic Advertising

Programmatic advertising uses impressions as a metric. Algorithms look for optimized ad purchases and make them accordingly. All of this cuts out a lot of the human element of deliberately choosing individual ad purchases or the purchases of large sets of ads.

In many ways, programmatic advertising has been hailed as a method of solving a particular problem in today's data-centered world. The problem is that an individual human purchaser can hardly keep on top of all of the optimal opportunities for ad purchases across a growing field of ad placement choices. So the programmatic advertising can do what the human decision-maker cannot – it can look at the big picture, evaluate many thousands of ad opportunities, and choose ones that are most optimized for a particular company’s needs, according to given input.

However, no process is entirely perfect, and programmatic advertising has also led to some ineffective ad purchases, or excessive ad purchases on a given platform. One common problem is the saturation of a particular user application with the same ads. Rather than creating optimal return on investment, these ads tend to annoy and frustrate users over time. Some inappropriate ad placement can also occur. One helpful piece of advice from experts is that there should always be human oversight of the automated programmatic purchase system, in order to try to mitigate some of the poorer choices that are made automatically.

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