According to the recently published Webinar presented by Adobe entitled “The Future of Programmatic Ad Buying” $21B was spent on Programmatic Media purchases worldwide in 2015 with $11B alone occurring in the US.  Adobe is predicting that by 2018, $53B of media acquisition will be through Programmatic transactions.  Therefore, as media buying continues to evolve including more and more programmatic buying, advertisers need to be more aware of how to capture transparency around how the money is spent and what is actually being purchased.   

Let’s look at three different ways in which Programmatic transactions are currently being performed: Open Auction, Private Exchange, and Guaranteed Direct.  Each of these options have positives and negatives that we will explore and become more informed on this accelerating media purchasing option.

Open Auction
Open Auction or Open Exchange is the traditional programmatic option.   Open Auction is a Real Time Bidding (RTB) public auction in which any buyer or seller can participate.  The biggest advantage for buyers is efficiency and the elimination of the need to work directly with publishers or ad networks to negotiate the pricing and buy inventory.  

However, within RTB auctions, there are different levels of transparency that are available for inventory; fully transparent, semi-blind and blind inventory.  Fully transparent is true to its name and allows for the buyer to have full view to the publishers inventory including domain names and allows for full-scale domain optimization.  In a semi-blind auction the domains are masked with a single URL and do not allow for the buyer to optimize on a single domain.  Though, the semi-blind auction will allow for the ability to optimize the networks URL’s.  Finally, a blind inventory auction is where publishers will remain anonymous to the market.  Here domain optimization is not possible and as a buyer you are unable to determine where you are buying from.

Private Exchange
Private Exchange or Private Auction is an invitation-only RTB auction.  During this Private Auction a publisher must invite a specific number of buyers to bid on the inventory.  Inventory purchased through a private exchange tends to have a high level of transparency and visibility.  This will successfully allow for a more advanced audience targeting model.  However, the ability to scale may be limited and competitors may be participating in the same auction.

Guaranteed Direct
A guaranteed direct programmatic buy is a non-auction based approach.  Here publishers will grant access to premium inventory with fixed prices.  Through guaranteed direct programmatic purchases, a buyer may also receive guaranteed impressions from the publisher.  Additionally, with a direct purchase buyers may receive full transparency, precise audience targeting with high visibility.  This, in turn, allows for exclusive participation.  On the flip side, the purchase price for a guaranteed direct buy is the most expensive and has the least amount of scalability.

As the trend continues and programmatic media buying continues to grow significantly over the next few years, it is imperative that buyers and advertisers understand the different channels in which inventory is now able to be purchased.  By learning about and understanding how each Media Agency is playing in the programmatic space, your ability to choose the best Media partner become less of challenge and allows for a more aligned partnership with your chosen agency.  Just keep in mind what the intended outcome of the purchase is and how much transparency you need to have and you will make the right purchasing decision for your media.  

Source One's Programmatic Media Buying experts will be at ISM2016, where Source One is the exclusive sponsor of the Exec IN forum. Want to save on registration costs to attend this landmark event? Learn more over at SourceOneInc.Com. 
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