WHAT IS PROGRAMMATIC ADVERTISING? 

Programmatic advertising is the automated process of buying and selling digital ad space in real time, using data and algorithms to target the right user at the right moment. Rather than relying on manual processes or predefined placements, programmatic platforms evaluate massive volumes of impressions in milliseconds to deliver ads to the most relevant users at the right time and for the right price. 

What makes programmatic so powerful is its ability to combine speed, scale, and precision, making it possible to run highly targeted campaigns across display, video, and mobile environments efficiently. 

The reliance on programmatic has grown steadily. According to IAB Europe’s 2024 data, 27% of advertisers say that over 81% of their display ad budgets are spent programmatically. On the agency side, the figure is even higher, with 68% of display spend now handled this way. 

This shift isn't limited to display: 

• For mobile advertising, around 20% of advertisers and 33% of agencies now allocate more than 80% of their mobile budgets to programmatic. 

• In video, roughly one-third of buyers say that over 81% of their video spend is now programmatic. 

• Even in Connected TV (CTV) 40% of advertisers say that over 41% of their CTV budgets go to programmatic buying, and 20% already invest more than 81% this way. Among agencies, 41% are above the 41% threshold, with 30% already at 81% or more. 

These numbers reflect a broader industry shift: from manual media buying to a model driven by automation, data, and measurable impact.  But with such widespread use, what exactly do we mean when we talk about programmatic? How do you set up these campaigns and which concepts are most often associated with it today? 

UNDERSTANDING THE SET-UP 

It all begins when a user visits a website or app that offers programmatic ad inventory. As the page loads, a request is generated for the ad space, often referred to as an "ad impression." If the user agrees to cookies, the request includes anonymized information about them, like device type, location, and browsing behavior, along with technical details about the ad placement, such as its size, position on the page, and allowed formats. 

This request is sent to an ad exchange, a digital marketplace where available ad impressions are auctioned off to the highest bidder. On the other side of the exchange, advertisers use tools called Demand-Side Platforms (DSPs) to analyze each incoming bid request. Based on predefined campaign settings and real-time data, the DSP evaluates whether the user fits the advertiser’s target audience. If the user is relevant, the DSP automatically places a bid for the impression. 

The auction happens in milliseconds. The highest bid (usually the one that offers the best combination of price and relevance) wins. The winning advertiser’s creative is then instantly delivered and displayed on the user's screen. This could be a display banner, a video, or a high-impact interactive ad, depending on the format supported by the placement. 

From the user's perspective, the ad appears seamlessly as the page loads. But behind the scenes, a highly complex and data-driven process has just taken place, all within the blink of an eye. 

As users engage with the ad, by viewing, clicking, or interacting, performance data is captured and sent back to the advertiser. This data plays a crucial role in optimizing future bidding decisions, allowing campaigns to become smarter and more efficient over time. 

CLARIFYING THE DIFFERENT TYPES OF BIDDING 

While programmatic advertising refers broadly to the automation of buying digital media, there are different methods within it — each affecting how ad inventory is made available and how advertisers compete for it. The most common approaches include Header Bidding and Tag-Based Bidding. Understanding the differences between them and how real-time bidding can enhance these bidding types, is essential for both advertisers and publishers. 

Header Bidding 

Header bidding is a technique that allows multiple demand sources to place bids on an impression at the same time, before the publisher’s ad server makes a final decision. It is typically implemented in the header section of a website or app, where a script enables simultaneous communication with different advertising partners.  The bids collected through header bidding are then passed to the ad server, which selects the winning ad based on the combined input of all sources. 

Tag-Based Bidding 

Tag-based bidding, often referred to as the "waterfall model," is based on a sequential hierarchy of ad tags placed by the publisher. When an ad impression becomes available, it is first offered to the top-priority partner. If that partner does not serve an ad (for example due to targeting or budget limits), the opportunity moves to the next partner in line, and so on.  This method relies on predefined order and fixed rules for how demand is accessed and prioritized. 

Real-time bidding

Real-time bidding (RTB) is the underlying auction mechanism that powers both header bidding and tag-based bidding in programmatic advertising. It allows multiple advertisers to bid on individual ad impressions in real time—within milliseconds—based on user data and context. In header bidding, RTB enables a more transparent and competitive auction by letting multiple demand sources bid simultaneously before the ad server makes a decision. In tag-based setups, RTB ensures that even a single call to an SSP can trigger an intelligent, dynamic auction that maximizes yield. In both cases, RTB improves efficiency, relevance, and revenue for publishers while delivering more targeted ads for users. 

WHAT HAPPENS BEHIND THE SCENES (THE TECH SIDE) 

Behind every programmatic impression is a fast-paced, data-driven negotiation between SSPs and DSPs. These are the differences between the platforms:

What is an SSP? 

A Supply-Side Platform is the technology used by publishers or tech providers to manage, sell, and optimize their ad inventory. The SSP is responsible for: 

• Making ad impressions available to potential buyers 

• Sending out bid requests to various ad exchanges or DSPs 

• Managing yield and pricing rules 

• Applying publisher controls (e.g., brand safety, floor prices, targeting restrictions) 

• Handling creative approvals and compliance 

When a user visits a website or app, the SSP collects all the relevant information about the impression (such as the user’s device, location, browsing context, and available ad slot) and sends this data as a bid request to one or more demand partners. 

SSPs often integrate with header bidding wrappers, which are central control systems, or act as part of a unified auction, enabling multiple buyers to compete at the same time, increasing competition and monetization potential. 

What is a DSP? 

A Demand-Side Platform is used by advertisers and agencies to buy ad impressions across various publishers and inventory sources. The DSP is responsible for: 

• Receiving bid requests from SSPs and evaluating their relevance 

• Matching impressions to the advertiser’s campaign goals and targeting criteria 

• Calculating how much to bid based on audience data, historical performance, and bidding strategy 

• Submitting the bid, including the creative and tracking elements 

• Monitoring results and optimizing performance in real time 

The DSP connects to data management platforms (DMPs) or other audience data sources to inform bidding decisions. For example, if a bid request matches a high-value user segment (e.g. someone who recently visited a product page), the DSP may decide to place a higher bid. 

KEY METRICS TO MEASURE PROGRAMMATIC ADVERTISING PERFORMANCE 

To evaluate the effectiveness of programmatic advertising, marketers rely on a range of key performance indicators that reflect both campaign reach and impact. 

The most commonly used metrics include: 

• Viewability  Ensures that the ad was actually seen (e.g., at least 50% in view for 1 second).  

• Click-Through Rate (CTR)  Measures how many users clicked on the ad after seeing it.  

• Conversion Rate  Tracks how many users completed a desired action (e.g., purchase, sign-up) after engaging with the ad.  

• Attention Metrics  Includes indicators like time in view, scroll depth, or engagement behaviors.  

• Video Completion Rate  Shows how many users watched a video ad to the end.  

• Cost-Based Metrics (CPM, CPC, CPV)  Help assess efficiency by showing how much is spent per impression, click, or video view. 

• Brand Lift / Awareness  Often measured through surveys or third-party tools, these metrics evaluate shifts in perception, recall, or intent after exposure. 

BENEFITS: 

The Benefits of Programmatic Advertising Programmatic advertising offers a range of benefits that have made it the preferred method for buying digital media across formats and channels. One of its biggest strengths lies in its ability to reach the right audience with precision. Using data and targeting technology, advertisers can identify and engage highly specific user segments — based on interests, behaviors, location, and more. In fact, according to IAB Europe’s 2024 findings, the top reason advertisers are investing more heavily in programmatic is audience discovery. 

Closely behind that is the value of granular control, including the ability to manage bids, budgets, and placements in real time, and the transparency of reporting, which gives advertisers clear insight into where their ads are being shown and how they’re performing. Today, the emphasis is on smarter targeting, actionable insights, and greater control. 

HOW TO SET UP A PROGRAMMATIC CAMPAIGN: 

Setting up a programmatic advertising campaign typically begins with defining the campaign objective — whether it's driving traffic, increasing conversions, or boosting brand awareness. From there, advertisers select their target audience, set budgets and bidding strategies, choose ad formats, and upload creatives. All of this is managed through a DSP, which connects to various ad exchanges and automates the real-time bidding process. 

For advertisers looking for more streamlined execution, especially when aiming to deliver more engaging formats, it can be highly effective to work with partners that offer a full-stack programmatic solution. These platforms combine access to premium inventory with proprietary technology, including SSPs, and enable the programmatic delivery of high-impact ad formats. This approach not only simplifies campaign management but also ensures consistent delivery, brand safety, and measurable performance across every stage of the media buying process. 

A strong example of a fully integrated adtech platform is VIS.X®, developed by YOC.  What began in 2018 as an SSP has since evolved into a full-stack solution — directly connected to all major DSPs and built to streamline the programmatic trading of high-impact ad formats.  It connects premium publisher inventory with advertisers in a unified environment, allowing for efficient campaign execution, precise targeting, and transparent reporting, all within one ecosystem.  

For advertisers looking to combine strong creative performance with operational simplicity, VIS.X® offers a robust solution that bridges both supply and demand through a single, integrated platform.  

Interested in launching a high-impact campaign programmatically?

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