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How Advertisers Navigate the Private Marketplace: A Beginner's Guide


May 18, 2017, By J.F. Houpert
|0 comments

This is the third blog post in a series that examines different programmatic media buying tactics. In my first blog post, I looked at how programmatic media buying works, the second article detailed how to run prospecting campaigns. In this post, I will outline how to navigate the private marketplace. 

The programmatic landscape is constantly evolving and with advertisers awash with low-quality inventory, many top brands are turning to premium programmatic advertising. These more selective programmatic marketplaces are called private marketplaces (PMP) and are where publishers sell premium advertising inventory.

Private marketplaces are invite only auctions or negotiated deals where the buyer purchases a specific amount of inventory that they control using their demand-side platform (DSP).

Due to the exclusive nature of PMPs and the premium inventory on offer, they are increasingly becoming more popular among advertisers. Adweek estimated the industry would be worth $8.6 billion this year.

In this post, I'll walk through the different types of private marketplaces and explain the advantages and disadvantages of each.

 

Premium deals (Also known as preferred deals)

If you are looking to access premium advertising space with guaranteed inventory, premium deals are probably your best bet. This type of transaction occurs when a publisher establishes a fixed cost per thousand (CPM) price and an advertiser pays for a specific number of impressions. 

For example, suppose you sell desktops, laptops and other such devices. By analyzing referral traffic through Google Analytics and looking at Voice of the Customer data, you realize individuals who are more likely to buy your products read Wired Magazine. You approach the publisher and arrange to purchase 10 million impressions for $10 CPM. Once the deal is confirmed with Wired Magazine, they will give you a deal ID that you can put into your DSP that will allow you to purchase up to 10 million impressions for $10 CPM.

One of the biggest benefits associated with this tactic is the publisher guarantees the inventory you purchase. Going back to the Wired example, you know you'll receive 10 million impressions without question. Also you can use the power of your DSP to target the audience you want to reach. For instance, you could just use the inventory to retarget users that visited your site or only use your impressions during a certain time of day, etc. This gives the advertiser significant control over how they use the inventory.  

So what's the downside to engaging publishers for premium deals? It is expensive.

 

Private deals

What if you want the freedom to buy as much inventory as you want? Consider making a private deal with a publisher. This is where a publisher makes their inventory available via an exchange for a fixed CPM. 

At first glance, you may think they're the same as premium deals, but the key differences are that:

  • You can buy as much inventory as you want, but the publisher doesn't guarantee the ad space. 
  • Premium deals are based on direct agreements between publishers, while a private deal is available in the exchange and is not negotiated directly with the publisher.

For example, if Wired has some extra advertising inventory and wants to sell it, it will make it available via an exchange as a private deal for a fixed CPM. As an advertiser you can purchase as much inventory at this fixed CPM as you want. But the publisher doesn’t have to guarantee the inventory, just the price.  

 

Private auctions 

Typically, ad inventory that couldn’t be sold under a premium deal or a private deal will be sold at private auction. 

Here's how it works:                       

  • Only advertisers that have been white-listed can bid.
  • The publisher will set a floor price and advertisers have to lock in their bids.
  • Finally, the advertiser with the highest bid above the floor price will win.      

The biggest advantage of private auctions is that it allows advertisers to get premium inventory at a reasonable price point.

Private marketplaces are an essential part of the programmatic advertising econ-system. So make sure you select the right type of private marketplace and take advantage of the premium ad inventory on offer.

Image source: Flickr 

J.F. Houpert

J.F. is a digital marketing expert with extensive experience in the areas of programmatic, data and advertising technologies. As Director of Data Solutions, J.F. is responsible for developing the next generation of advertising technology solutions to maximize the value of first-party customer feedback data.

How Advertisers Navigate the Private Marketplace: A Beginner's Guide


May 18, 2017, By J.F. Houpert
|0 comments

This is the third blog post in a series that examines different programmatic media buying tactics. In my first blog post, I looked at how programmatic media buying works, the second article detailed how to run prospecting campaigns. In this post, I will outline how to navigate the private marketplace. 

The programmatic landscape is constantly evolving and with advertisers awash with low-quality inventory, many top brands are turning to premium programmatic advertising. These more selective programmatic marketplaces are called private marketplaces (PMP) and are where publishers sell premium advertising inventory.

Private marketplaces are invite only auctions or negotiated deals where the buyer purchases a specific amount of inventory that they control using their demand-side platform (DSP).

Due to the exclusive nature of PMPs and the premium inventory on offer, they are increasingly becoming more popular among advertisers. Adweek estimated the industry would be worth $8.6 billion this year.

In this post, I'll walk through the different types of private marketplaces and explain the advantages and disadvantages of each.

 

Premium deals (Also known as preferred deals)

If you are looking to access premium advertising space with guaranteed inventory, premium deals are probably your best bet. This type of transaction occurs when a publisher establishes a fixed cost per thousand (CPM) price and an advertiser pays for a specific number of impressions. 

For example, suppose you sell desktops, laptops and other such devices. By analyzing referral traffic through Google Analytics and looking at Voice of the Customer data, you realize individuals who are more likely to buy your products read Wired Magazine. You approach the publisher and arrange to purchase 10 million impressions for $10 CPM. Once the deal is confirmed with Wired Magazine, they will give you a deal ID that you can put into your DSP that will allow you to purchase up to 10 million impressions for $10 CPM.

One of the biggest benefits associated with this tactic is the publisher guarantees the inventory you purchase. Going back to the Wired example, you know you'll receive 10 million impressions without question. Also you can use the power of your DSP to target the audience you want to reach. For instance, you could just use the inventory to retarget users that visited your site or only use your impressions during a certain time of day, etc. This gives the advertiser significant control over how they use the inventory.  

So what's the downside to engaging publishers for premium deals? It is expensive.

 

Private deals

What if you want the freedom to buy as much inventory as you want? Consider making a private deal with a publisher. This is where a publisher makes their inventory available via an exchange for a fixed CPM. 

At first glance, you may think they're the same as premium deals, but the key differences are that:

  • You can buy as much inventory as you want, but the publisher doesn't guarantee the ad space. 
  • Premium deals are based on direct agreements between publishers, while a private deal is available in the exchange and is not negotiated directly with the publisher.

For example, if Wired has some extra advertising inventory and wants to sell it, it will make it available via an exchange as a private deal for a fixed CPM. As an advertiser you can purchase as much inventory at this fixed CPM as you want. But the publisher doesn’t have to guarantee the inventory, just the price.  

 

Private auctions 

Typically, ad inventory that couldn’t be sold under a premium deal or a private deal will be sold at private auction. 

Here's how it works:                       

  • Only advertisers that have been white-listed can bid.
  • The publisher will set a floor price and advertisers have to lock in their bids.
  • Finally, the advertiser with the highest bid above the floor price will win.      

The biggest advantage of private auctions is that it allows advertisers to get premium inventory at a reasonable price point.

Private marketplaces are an essential part of the programmatic advertising econ-system. So make sure you select the right type of private marketplace and take advantage of the premium ad inventory on offer.

Image source: Flickr 

J.F. Houpert

J.F. is a digital marketing expert with extensive experience in the areas of programmatic, data and advertising technologies. As Director of Data Solutions, J.F. is responsible for developing the next generation of advertising technology solutions to maximize the value of first-party customer feedback data.

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