How Does Programmatic Advertising Work?

Programmatic Advertising

The process of automating the purchase of advertising inventory, which takes place in the framework of programmatic advertising, allows advertisers to increase the effectiveness of their campaigns, reduce management costs, and maximize ROI. Programmatic advertising allows advertisers to work with different types of advertising content and successfully generate video, banner, or push traffic. If you want to learn more about how programmatic advertising works, this article is for you.

What Is Programmatic Advertising?

Programmatic advertising is the automated purchase and sale of advertising space on the Internet. With the help of such a tool, marketers carry out ordering, setting up, and reporting on advertising using software platforms. This allows you to increase your audience reach while effectively distributing your advertising budget.

Previously, all this had to be done manually: select a site, an advertising slot, calculate, and purchase impressions. All this made the process expensive and unreliable, because the volume of traffic on the site is constantly changing, and each time negotiating the purchase and sale of advertising slots takes too long.

In the dynamic landscape of programmatic advertising, ensuring a seamless and efficient launch involves strategic considerations beyond the ad tech realm. Just as Linux/Unix systems are revered for their reliability and robust performance in the computing world, aligning programmatic advertising with a well-architected infrastructure is pivotal for success.

Embracing a Linux/Unix approach in programmatic advertising operations echoes the principles of open-source collaboration. Much like the transparency of open-source code, programmatic campaigns benefit from transparent communication channels between various components. The distributed nature of Linux/Unix systems can be likened to the distributed nature of programmatic advertising platforms, where multiple interconnected components work cohesively.

Programmatic advertising makes it easier and faster to place ads. In this case, the digital advertising space market is managed by special exchanges. They conduct automated auctions and combine both sides of the transaction:

  • advertisers who want to buy advertising space on the Internet;
  • website owners with digital space for sale.

Each party uses the platform. Advertisers are on the demand side (DSP), and website owners are on the supply side (SSP).

A DSP allows advertisers to purchase ad impressions on websites and in-apps available through ad exchanges and networks. At the same time, companies can select the target audiences they need, focusing on location, age, interests, online behavior, and much more.

How Does Programmatic Advertising Work?

The procedure for purchasing and displaying advertising looks like this:

  • The user visits the site.
  • The site owner puts up advertising for the SSP auction.
  • Advertisers bid per impression through a DSP that automatically distributes impressions based on the bid price and target audience preferences.
  • The highest bidder gets the ad shown.
  • The announcement is published on the website/app.
  • Despite the many stages, this entire process happens in an instant. Mathematical algorithms and analytics tools are responsible for calculating competing rates. Therefore, the most profitable rate is issued automatically.

As an example of how programmatic advertising works, let’s consider the following scenario:

The company wants to sell designer jewelry for women. It turns to a software platform that can identify consumers based on criteria such as:

  • Gender: female.
  • Age group: 18 – 35 years old.
  • Interests: fashion, style.
  • Behavior: reading fashion blogs late at night.
  • Device: laptop, smartphone.

This data helps the system plan and determine what advertising content is relevant to a particular user. When a person who meets the criteria visits a blog dedicated to fashion and style, the system reacts and shows him a banner or video related to the designer jewelry.

Benefits of Programmatic Advertising

Programmatic advertising, thanks to anti-fraud solutions, reaches only real users and excludes bots and fake accounts. At the same time, the results of bets are much easier to predict and become more transparent.

In addition, the following advantages of programmatic advertising can be highlighted:

  • Large-scale audience coverage. The higher the cost of display, the greater the coverage.
  • Advertising profitability
  • Even with a small budget, an advertiser can reach the target audience and increase their awareness of the product or service.
  • Real-time data and analysis. This allows the advertiser to make decisions on ad placement faster. Including in proactive mode.
  • Use of own and third-party data. Advertisers can upload their own target audience criteria to the platform and combine them with data available in the DSP.
  • Cross-platform strategy. Once the user’s interest peaks on one advertising channel, the advertiser has the opportunity to hook the client on another.

How to Run Programmatic Advertising?

The launch of programmatic advertising begins with the search for a DSP platform suitable for the brand’s objectives. Typically, platforms provide detailed instructions for setting up ads. Typically, the user only needs to specify the goals of the advertising campaign, and the built-in algorithms will do the rest of the work.

It is most convenient to use platforms that allow you to work with programmatic in one window mode. In this case, the marketer can not only monitor the progress of the campaign but also get a clear idea of the target audience segments.

Programmatic is automated advertising and the entire process after setup takes place almost without the participation of the advertiser.

Step 1. Define your goal.

It is important to understand why you are running advertising – to increase sales, increase brand awareness, and improve its image, or attract additional traffic to the site. The main targeting settings and the method of purchasing advertising depend on the goal.

Step 2. Choose a buying method.

If you decide to purchase through an auction, then you decide on a DSP platform. Pay attention to the sites in the advertising network database, their quantity, quality, and coverage. When you purchase advertising using the Programmatic Direct system, you directly contact the publisher. If you are buying according to the PMP model, then in this case you need an invitation to a closed auction.

Step 3. Calculate your budget.

Its size affects the duration of the campaign and on which platforms the ads will run. The larger it is, the longer and better the quality of the advertising.

Step 4. Choose ad type.

You need to understand where exactly the visitor will interact with your ad. For example, at the end of a video, on a thematic website, in an application on a pop-up screen.

Step 5. Set up your target.

In the programmatic service, you indicate the main characteristics of the audience: gender, age, geo, and interests. The effectiveness of advertising depends on how competently you have developed the portrait of your target audience.

Step 6. Prepare creative content.

In programmatic advertising, you can use video, and audio, advertising on social networks, ads on websites, and advertising in mobile applications. Subsequently, you can consider a fairly standard banner traffic or test push traffic, the possibilities are limited only by your imagination.

Step 7. Launch an advertising campaign.

You upload creative content into the system, check all settings and budgets, and transfer the advertising company to active status. After launch, you need to monitor metrics – for example, analyze how often visitors click on ads and make conversions.


With programmatic advertising, you can regularly test different ad and creative options, audiences, and strategies to determine the best approaches to reach your target audience. Perhaps push traffic or video traffic will work most effectively in your case. Continuously optimize campaigns based on data and testing results. We recommend paying attention to the company SmartyAds, which provides modern, effective programmatic solutions for all participants in the advertising market. In essence, launching programmatic advertising correctly involves drawing parallels with the reliability, scalability, and security features embedded in the Linux/Unix ecosystem. Just as Linux/Unix has become synonymous with stability in the world of operating systems, integrating these principles into programmatic advertising practices contributes to a resilient and high-performing ad campaign.