What is Programmatic Guaranteed?

Reading time: 4 minutes

If you want to be an online publisher[5] earning money from your site, it usually involves relying on ad revenue. If you’ve already taken steps to monetize your site using open auctions, private auctions, or preferred deals, entering the realm of programmatic guaranteed[1] deals will be like entering the VIP section of programmatic advertising[2].  

While programmatic guaranteed is just one form of programmatic direct[3] advertising, it is the fastest growing member of the bunch. By incorporating audience targeting[6] and guaranteed terms, it is a powerful tool for both media buyers and sellers. 

Selling ad inventory[7][4] via programmatic guaranteed agreements is ideal for publishers with a clearly defined audience and for those who feel they could be getting a better financial return on their ad inventory sales. 

Recent reports have placed the usage of programmatic guaranteed ad buys at around 58% of programmatic display spending. That number is forecasted to increase to 80% of all such deals in the near future. Clearly, understanding what programmatic guaranteed deals are and how they work is key to taking advantage of these trends.

So, what is? 

Programmatic guaranteed deals are agreements between ad buyers and sellers in which the campaign[8] details are agreed upon prior to the campaign launch. Specifically, publishers agree to provide the seller with an exact number of impressions from a target audience for a predetermined price. 

What makes programmatic guaranteed desirable for both publishers and ad buyers is the ability to lock in revenue and impressions, respectively. By agreeing in advance to the most important metrics on each side, both parties are armed with reliable information for future planning. 

Using a more automated workflow, programmatic guaranteed deals provide direct exposure to buyers’ target audiences while limiting the amount of work for publishers in selling ad inventory. By eliminating much of the ongoing work associated with selling and managing ad inventory, publishers realize a much greater return on their time using programmatic guaranteed. 

How is it Different? 

The defining characteristic of programmatic guaranteed ad agreements is that each party is guaranteeing a result to the other party. The buyer gets a certain number of impressions from their target audience, while the publisher receives a predetermined amount of revenue for delivering those impressions. 

Programmatic guaranteed is different from preferred deals because of the guaranteed volume of impressions and monetary value of those impressions that is agreed upon by both parties. Eliminating the uncertainty on both sides of the transaction makes entering into a programmatic guaranteed agreement different from other deals. 

Compared to open and private auctions, programmatic guaranteed deals are able to provide publishers a better return on their ad inventory since the terms of the deal are set in advance. A buyer of ad inventory through a programmatic guaranteed deal is getting the desired amount of exposure to their target audience and is thus willing to pay more to achieve these goals.

How do you set it up?

Publishers enter into programmatic guaranteed deals by reaching a one-on-one agreement directly with an ad inventory buyer. To facilitate a programmatic guaranteed deal, a publisher can send a direct request to a buyer, or a buyer may submit a request for proposal to the seller. In either case, both parties must agree to the details of the proposal prior to commencing the ad inventory purchase. 

Finding a suitable partner for this type of deal is the most challenging part of entering such an agreement. Since publishers are working directly with only one ad buyer, the ability to find and negotiate with the right buyer is a must. 

What are Benefits to Publishers? 

Due to its many benefits, this type of deal is rapidly gaining popularity among publishers. The main benefits realized by publishers are more predictable revenue and a reduction in the time and effort necessary to sell ad inventory.

Many publishers also realize more revenue from programmatic guaranteed agreements, because buyers are willing to pay a premium to reach their target audience with a specific number of impressions. The certainty provided to both sides makes programmatic guaranteed a great opportunity for buying and selling ad inventory. 

With programmatic guaranteed, publishers also improve relationships with advertisers, since they receive a better return on their ad spending. According to Google, publishers save 57% more time with programmatic guaranteed (vs. traditional ad spend) while still maintaining control over their campaigns.

Conclusion

This is the fastest-growing type of programmatic direct advertising, largely due to the relative certainty of ad revenue, reduced time and effort managing ad inventory, and potentially higher revenues. For publishers to take advantage of these opportunities, finding a buyer who wants to reach the publisher’s audience is the first step, followed by negotiating an acceptable agreement. 

Terms
1. programmatic guaranteed. This type of programmatic advertising enables a programmatic buyer to agree beforehand or guarantee a cookie/device ID matched audience for a fixed price.
2. programmatic advertising. Programmatic advertising entails using machine learning and technology suites to buy and sell ad inventory with a data-driven process.
3. programmatic direct. Programmatic direct is where specified buyers get access to specified inventory that’s not necessarily available from an open marketplace or a supply-side platform (SSP).
4. ad inventory. Ad Inventory refers to the number of ad impressions available for sale on a publisher’s website or mobile app. In other words, these are the commodities available for the advertisers to buy on the website.
5. publisher. Web publishing is the process of publishing original content on the Internet. The process includes building and uploading websites, updating the associated webpages, and posting content to these webpages online. Web publishing is also known as online publishing.

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