{"id":22281,"date":"2020-02-20T14:31:45","date_gmt":"2020-02-20T13:31:45","guid":{"rendered":"https:\/\/yieldbird.com\/?p=22281"},"modified":"2024-07-22T19:27:13","modified_gmt":"2024-07-22T17:27:13","slug":"programmatic-sales-models","status":"publish","type":"post","link":"https:\/\/yieldbird.com\/research-hub\/programmatic-sales-models\/","title":{"rendered":"Programmatic Sales Models"},"content":{"rendered":"\n<p class=\"has-very-dark-gray-color has-text-color has-normal-font-size wp-block-paragraph\">Programmatic has helped the entire industry to move beyond low-quality inventory channels. Indeed, rapid expansion has allowed Programmatic to forge onwards with its conquest of the digital market. In the US, Programmatic already occupies more than half of the cost of media advertising; while in the EMEA, Programmatic accounts for a third of the market. Over the course of the past few years, <a href=\"https:\/\/yieldbird.com\/programmatic-advertising-2020\/\">the Programmatic ad spend has increased four-fold<\/a>. What is more, new tools, trends and business models have come along, which have significantly facilitated <a rel=\"nofollow\" href=\"https:\/\/digiday.com\/media\/programmatic-ad-revenue-grows-publishers-sales-team-structures\/\">the success trajectories of Publishers<\/a>. <\/p>\n\n\n\n<h2 style=\"font-size: 20px;\">What are Programmatic Sales Models?<\/h2>\n\n\n\n<div class=\"wp-block-image\"><figure class=\"alignleft is-resized\"><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/yieldbird.com\/wp-content\/uploads\/2020\/02\/0254-Modele-03-1024x633.png\" alt=\"Programmatic Sales Models\" class=\"wp-image-22286\" width=\"246\" height=\"151\" srcset=\"https:\/\/yieldbird.com\/research-hub\/wp-content\/uploads\/2020\/02\/0254-Modele-03-1024x633.png 1024w, https:\/\/yieldbird.com\/research-hub\/wp-content\/uploads\/2020\/02\/0254-Modele-03-150x93.png 150w, https:\/\/yieldbird.com\/research-hub\/wp-content\/uploads\/2020\/02\/0254-Modele-03-300x185.png 300w, https:\/\/yieldbird.com\/research-hub\/wp-content\/uploads\/2020\/02\/0254-Modele-03-768x474.png 768w\" sizes=\"auto, (max-width: 246px) 100vw, 246px\" \/><\/figure><\/div>\n\n\n\n<p class=\"has-very-dark-gray-color has-text-color has-normal-font-size wp-block-paragraph\"><b>Programmatic allows advertisers to buy advertising inventory in real time with the possibility of showing an ad to a selected target group, and within a specific context<\/b>. This means that Advertisers can use data to determine whether they need a particular ad impression \u2014 and if they do, they can determine the price they are willing to pay for that impression. <br><br>However, the process of achieving KPIs starts prior to acceptance of the incoming deal, the uploading of creatives, and so on. First of all, this process begins while the Advertiser assesses which transaction type will be more relevant for a particular campaign; and why they need to focus only on this type of transaction over others. Here we present <strong>Programmatic Sales Models<\/strong>; and we ask how such models can benefit your business in different cases. <\/p>\n\n\n\n<p class=\"has-very-dark-gray-color has-text-color has-normal-font-size wp-block-paragraph\">First of all, <em>Programmatic Sales Models<\/em> are divided according to the main criteria: <\/p>\n\n\n\n<ul class=\"wp-block-list\"><li><a href=\"https:\/\/yieldbird.com\/the-role-of-competitive-pricing-on-the-open-market\/\">pricing<\/a>; auction or fixed price, <\/li><li>access &#8211; open-access versus invitation-only,<\/li><li>the presence or absence of guaranteed impressions.<\/li><\/ul>\n\n\n\n<figure class=\"wp-block-image\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"633\" src=\"https:\/\/yieldbird.com\/wp-content\/uploads\/2020\/02\/0254-Modele-01-1024x633.png\" alt=\"Programmatic Inventory\" class=\"wp-image-22282\" srcset=\"https:\/\/yieldbird.com\/research-hub\/wp-content\/uploads\/2020\/02\/0254-Modele-01-1024x633.png 1024w, https:\/\/yieldbird.com\/research-hub\/wp-content\/uploads\/2020\/02\/0254-Modele-01-300x185.png 300w, https:\/\/yieldbird.com\/research-hub\/wp-content\/uploads\/2020\/02\/0254-Modele-01-150x93.png 150w, https:\/\/yieldbird.com\/research-hub\/wp-content\/uploads\/2020\/02\/0254-Modele-01-768x474.png 768w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><\/figure>\n\n\n\n<p class=\"has-very-dark-gray-color has-text-color has-normal-font-size wp-block-paragraph\">Based on the criteria above, we can distinguish <strong>4 different Programmatic Sales Models<\/strong>:<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li><b>Open Auction<\/b><\/li><li><b>Private Marketplace<\/b><\/li><li><b>Preferred Deal<\/b><\/li><li><b>Programmatic Guaranteed<\/b><\/li><\/ul>\n\n\n\n<p class=\"has-very-dark-gray-color has-text-color has-normal-font-size wp-block-paragraph\">The first difference between these models is the <strong>type of pricing<\/strong>. Impressions can be auctioned on an exchange and buyers can bid for them. Alternatively, the site and the buyer can conclude a direct transaction, without an auction, in which case the price is fixed (predetermined). <br><br>The <strong>Auction Sales Model<\/strong> (including either <b>Open<\/b> or <b>Private Auctions<\/b>) has served Advertisers well by covering their core need, which is to reach a given audience. However, after practicing blind buying, buyers, tired of this practice, began offering impressions at a fixed price: the result being that advertising is often not shown to the real target audience. <br><br>The <b>presence or absence of the auction<\/b> immediately divides the entire field of Programmatic into two large parts: <i>auction types of buying<\/i>, and <i>Programmatic Direct Transactions<\/i>. At the same time, the auction type includes <b>Open Auction<\/b> and <b>Private Auction<\/b>. <br><br><b>Open Auction<\/b> is a real-time bidding model, where any Publisher and Advertiser can participate while prices are determined in real-time. In a nutshell, Publishers allow access to media inventory in ad exchanges at a minimum CPM price, while Advertisers bid against each other until the highest bid wins. A <b>Private Auction <\/b>is a similar model to the <b>Open Auction<\/b>, except for the access which Publishers set for only selected Advertisers; while other buyers do not even see this <br><br>On the other hand, <strong>Programmable Direct Transactions<\/strong> are divided into: <\/p>\n\n\n\n<ul class=\"wp-block-list\"><li><b>Programmatic Guaranteed<\/b> &#8211; programmatic deals with a guaranteed volume of impressions and at a fixed price;<\/li><\/ul>\n\n\n\n<ul class=\"wp-block-list\"><li><b>Preferred Deal<\/b> \u2013 programmatic deals without a guaranteed number of impressions, but with a fixed price. <\/li><\/ul>\n\n\n\n<p class=\"has-very-dark-gray-color has-text-color has-normal-font-size wp-block-paragraph\">Let\u2019s delve into the specifics of both transaction types: &nbsp;<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li><b>Preferred Deal<\/b> \u2013 a fixed-price transaction without a guaranteed number of impressions. The invitation fixes the price, inventory (sites and sections), formats, audience segments and other parameters agreed between Advertiser and Publisher. Once a buyer has accepted a deal, they can buy impressions that the marketplace directs to that same deal. <\/li><\/ul>\n\n\n\n<ul class=\"wp-block-list\"><li><b>Programmatic Guaranteed<\/b> &#8211; this is a model in which both the price and the volume of impressions are fixed and known by both sides \u2013 Publisher and Advertiser. In fact, this is the implementation of direct sales through the Programmatic ecosystem. The main purpose of this model is to automate the direct sales of the site, reduce costs, increase the efficiency of media planning, and increase the speed of the advertising process.  <\/li><\/ul>\n\n\n\n<p class=\"has-very-dark-gray-color has-text-color has-normal-font-size wp-block-paragraph\"><br><\/p>\n\n\n\n<h2 style=\"font-size: 20px\">Do we need so many Programmatic Sales Models?<\/h2>\n\n\n\n<p class=\"has-very-dark-gray-color has-text-color has-normal-font-size wp-block-paragraph\"><br><\/p>\n\n\n\n<p class=\"has-very-dark-gray-color has-text-color has-normal-font-size wp-block-paragraph\">Let us now address why there are so many <strong>Programmatic Sales Models<\/strong> and explore what purpose each of them serves. The industry has been working on these models for many years in order to solve the needs of both Advertisers and Publishers in terms of buying and selling media inventory; the ambition being to completely (or almost completely) replace the traditional direct way of media buying. The fundamental difference between the models is their priority in terms of ad serving and the major competition which coalesces around the user who sees the ad first. <\/p>\n\n\n\n<p class=\"has-text-align-center has-small-font-size wp-block-paragraph\"><em>Programmatic Sales Models by ad-serving priority<\/em>:<\/p>\n\n\n\n<figure class=\"wp-block-image\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"633\" src=\"https:\/\/yieldbird.com\/wp-content\/uploads\/2020\/02\/0254-Modele-02-1024x633.png\" alt=\"programmatic sales\" class=\"wp-image-22283\" srcset=\"https:\/\/yieldbird.com\/research-hub\/wp-content\/uploads\/2020\/02\/0254-Modele-02-1024x633.png 1024w, https:\/\/yieldbird.com\/research-hub\/wp-content\/uploads\/2020\/02\/0254-Modele-02-300x185.png 300w, https:\/\/yieldbird.com\/research-hub\/wp-content\/uploads\/2020\/02\/0254-Modele-02-150x93.png 150w, https:\/\/yieldbird.com\/research-hub\/wp-content\/uploads\/2020\/02\/0254-Modele-02-768x474.png 768w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><\/figure>\n\n\n\n<p class=\"has-very-dark-gray-color has-text-color has-normal-font-size wp-block-paragraph\">On the <b>Open Auction<\/b>, quite often we can find traffic leftovers, which Publishers have failed to sell within the highest transactions; but this does not always mean that this is low-quality traffic. The positive aspect of this kind of traffic is that there is a lot of it, and this allows buyers to acquire coverage at a fairly low cost, which allows buyers to find audiences from large and small segments, as well as to obtain an adequate cost of the final CPM for the client.  <br><br>When it comes to a <strong>Direct Programmatic Deal<\/strong>, this involves direct negotiations with the Publisher in order to buy traffic through the DSP. Thanks to this, the quality of traffic can reach a new level \u2013 prices increase, but the buyers take control over the placements where they are showing ad on.  <br><br>In the hierarchy of ad serving from the Publisher\u2019s perspective, the priority is always given to transactions with a fixed and\/or guaranteed volume of impressions \u2013 <b>Direct Sales<\/b> and <b>Programmatic Guaranteed<\/b>. Firstly, regardless of the price, the Publisher must provide the Direct Advertiser with a requested number of impressions. Secondly, these transactions tend to have the highest price and include the most premium ad slots. <br><br>Everything that comes after Programmatic Guaranteed can be generally called a residual inventory and sells by way of a \u201cwaterfall\u201d priority. The first in this regard are <b>Preferred Deals<\/b>. However, when the site has several Preferred Deals, then the deal that has a <a href=\"https:\/\/yieldbird.com\/price-management\/\">higher price will always get priority<\/a>. This is fair enough, because if all the buyers are hunting for a certain number of users, and if there is an intersection between buyers in the purchasing of a particular user&#8217;s display, then the winner will be the one who is willing to pay more. In this case, there is no real-time auction, but rather fixed early-determined prices compete against one another. Anything that is not sold through Preferred Deals enters a Private Auction, and then, in an Open Auction. <\/p>\n\n\n\n<p class=\"has-very-dark-gray-color has-text-color has-normal-font-size wp-block-paragraph\"><br><\/p>\n\n\n\n<h2 style=\"font-size: 20px\">The Publisher\u2019s perspective<\/h2>\n\n\n\n<p class=\"has-very-dark-gray-color has-text-color has-normal-font-size wp-block-paragraph\"><br><\/p>\n\n\n\n<div class=\"wp-block-image\"><figure class=\"alignleft is-resized\"><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/yieldbird.com\/wp-content\/uploads\/2019\/12\/G\u0142\u00f3wna-1024x640.png\" alt=\"Revenue Sources For Digital Publishers\" class=\"wp-image-21625\" width=\"256\" height=\"159\"\/><\/figure><\/div>\n\n\n\n<p class=\"has-very-dark-gray-color has-text-color has-normal-font-size wp-block-paragraph\">The main goal for the Publisher is to <b>maximize profit by making recourse to the flexibility afforded by Programmatic<\/b>, and managing what the inventory is offering for sale, and at what price. Nowadays, Publishers can offer a holistic approach to Direct and Programmatic Sales Opportunities for Programmatic Buyers. In order to activate any type of solution via the header, the implementation must support deal IDs outside the mediation layer. Deals can be set up on a one-to-one basis between a seller and a specific brand buyer, or in some cases, on the basis of a one-to-many, where a publisher will allow any buyer in a specific platform to participate in a guarantee. There are many prognoses and thoughts on how Programmatic transactions affect direct cooperation between the Publisher and Advertiser, and the most accepted prognosis is that such cooperation should eventually take the bulk of traditional sales.<\/p>\n\n\n\n<p class=\"has-very-dark-gray-color has-text-color has-normal-font-size wp-block-paragraph\">Publishers allow buyers who are hunting for a limited pool of particularly valuable users to pay a premium to the price and get their audience more likely. Thanks to <b>Preferred Deals<\/b> and <b>Private Auctions<\/b>, publishers are able to start selling through different transaction types while maintaining control over who buys their inventory and how. That is why the appearance of different sale models was the first reason for raising the premium platform number on the market (and it keeps growing year-to-year). <\/p>\n\n\n\n<div style=\"height:50px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<!-- Begin Mailchimp Signup Form -->\n<link href=\"\/\/cdn-images.mailchimp.com\/embedcode\/horizontal-slim-10_7.css\" rel=\"stylesheet\" type=\"text\/css\">\n<style type=\"text\/css\">\n\t#mc_embed_signup{background:#fff; clear:left; font:14px Helvetica,Arial,sans-serif; width:100%;}\n\t\/* Add your own Mailchimp form style overrides in your site stylesheet or in this style block.\n\t   We recommend moving this block and the preceding CSS link to the HEAD of your HTML file. *\/\n<\/style>\n<div id=\"mc_embed_signup\">\n<form action=\"https:\/\/yieldbird.us7.list-manage.com\/subscribe\/post?u=0a65a0626fcc516279eb5d544&amp;id=53c5dbaf01\" method=\"post\" id=\"mc-embedded-subscribe-form\" name=\"mc-embedded-subscribe-form\" class=\"validate\" target=\"_blank\" novalidate=\"\">\n    <div id=\"mc_embed_signup_scroll\">\n\t<label for=\"mce-EMAIL\">Subscribe to The Yieldbird Digest!<\/label>\n\t<input type=\"email\" value=\"\" name=\"EMAIL\" class=\"email\" id=\"mce-EMAIL\" placeholder=\"email address\" required=\"\">\n    <!-- real people should not fill this in and expect good things - do not remove this or risk form bot signups-->\n    <div style=\"position: absolute; left: -5000px;\" aria-hidden=\"true\"><input type=\"text\" name=\"b_0a65a0626fcc516279eb5d544_53c5dbaf01\" tabindex=\"-1\" value=\"\"><\/div>\n    <div class=\"clear\"><input type=\"submit\" value=\"Subscribe\" name=\"subscribe\" id=\"mc-embedded-subscribe\" class=\"button\"><\/div>\n    <\/div>\n<\/form>\n<\/div>\n\n<!--End mc_embed_signup-->\n\n\n\n<div style=\"height:50px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n\n\n<p class=\"has-very-dark-gray-color has-text-color has-normal-font-size wp-block-paragraph\"><br><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Programmatic has helped the entire industry to move beyond low-quality inventory channels. Indeed, rapid expansion has allowed Programmatic to forge onwards with its conquest of the digital market. In the US, Programmatic already occupies more than half of the cost of media advertising; while in the EMEA, Programmatic accounts for a third of the market. [&hellip;]<\/p>\n","protected":false},"author":7,"featured_media":22286,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[28],"tags":[],"content-category":[],"class_list":["post-22281","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-ad-tech"],"acf":[],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/yieldbird.com\/research-hub\/wp-json\/wp\/v2\/posts\/22281","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/yieldbird.com\/research-hub\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/yieldbird.com\/research-hub\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/yieldbird.com\/research-hub\/wp-json\/wp\/v2\/users\/7"}],"replies":[{"embeddable":true,"href":"https:\/\/yieldbird.com\/research-hub\/wp-json\/wp\/v2\/comments?post=22281"}],"version-history":[{"count":1,"href":"https:\/\/yieldbird.com\/research-hub\/wp-json\/wp\/v2\/posts\/22281\/revisions"}],"predecessor-version":[{"id":33422,"href":"https:\/\/yieldbird.com\/research-hub\/wp-json\/wp\/v2\/posts\/22281\/revisions\/33422"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/yieldbird.com\/research-hub\/wp-json\/wp\/v2\/media\/22286"}],"wp:attachment":[{"href":"https:\/\/yieldbird.com\/research-hub\/wp-json\/wp\/v2\/media?parent=22281"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/yieldbird.com\/research-hub\/wp-json\/wp\/v2\/categories?post=22281"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/yieldbird.com\/research-hub\/wp-json\/wp\/v2\/tags?post=22281"},{"taxonomy":"content-category","embeddable":true,"href":"https:\/\/yieldbird.com\/research-hub\/wp-json\/wp\/v2\/content-category?post=22281"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}