Programmatic Advertising

Talking About Programmatic Advertising: Episode 4 – How Much?

By August 17, 2016 No Comments

How is ad inventory sold?

Ad inventory can either be sold on a reserved basis (guaranteed to run) or an unreserved basis (if the excess inventory is there to fulfil your request).  And, the pricing can either be fixed (set rates, impressions, budgets) or auction-based (the price will be set at that of the highest bidder).

The realtime bidding model is commonly referred to as RTB in the industry.

According to Marin, only 8% of programmatic was reserved inventory/fixed price buys in 2014. But, that is expected to grow to 42% in 2016.

How much does it cost?

Ads are sold either on a CPM (Cost Per 1,000 impressions), CPC (Cost Per Click), CPA (Cost Per Action) or CTC (Click Through Conversion) basis. But, assume most programmatic is typically sold on a CPM basis.

CPMs can range wildly based on the quality of the list and the level of targeting.  The higher quality the list or the more specific you want to target, the higher the price.  Prices also vary by industry, by device, by format and by placement on the page.  But, on average, assume CPMs in the $0.50 to $2 CPM range via programmatic which is material savings vs. the $10 or higher CPMs that are typically in the human-driven, non-programmatic world.

So, programmatic advertising can help in stretching our limited ad budgets 10 to 20 times farther which should be music to the ears of most small businesses with limited marketing budgets.

 

Yeap, this is the last episode on this, please drop your comments or questions in the box provided below. Also, do find the full archive on programmatic advertising here: https://www.tinklingd.com/programmatic-advertising.

Do you now want to go crazy with programmatic advertising and explore the capabilities of this revolutionary ad system, may be to run some large awareness campaign or get more out of online ad spend, please reach out to the prog-ad-ninjas@tinklingd.com

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