Programmatic advertising has revolutionized digital marketing over the past decade. By using automated systems and machine learning algorithms to buy and sell advertising in real-time, programmatic delivers highly targeted, data-driven campaigns to engage consumers across devices and formats. Spending on programmatic ads reached $378 billion globally in 2022, making up 83% of total digital display spending according to eMarketer. As programmatic continues to dominate, what are the leading advertising technology platforms brands should consider for 2023 and beyond?
What is Programmatic Advertising?
Programmatic refers to the automated buying and selling of digital advertising impressions through real-time bidding (RTB). Unlike direct ad sales, programmatic employs technology to instantly evaluate each impression and place bids to show ads targeted to specific audiences. It relies on an ecosystem of demand-side platforms (DSPs), sell-side platforms (SSPs) and ad exchanges to power these transactions.
On the buy side, advertisers use DSPs to set targeting parameters, manage budgets and bids, activate data for personalization and measure campaign performance. SSPs allow publishers to make their ad inventory available for programmatic sales and maximize yield through precise audience segmentation and price optimization. Ad exchanges serve as centralized marketplaces to bring buyers and sellers together for efficient trading.
Benefits of Programmatic Advertising
Programmatic unlocks a range of advantages for modern digital marketing:
- Precision targeting – Advertisers can define audiences based on demographics, interests, behaviors and more to increase relevance.
- Automated optimization – Machine learning continually adjusts bids and targets to improve campaign results.
- Real-time adaptability – Changes can be made instantly based on performance or external factors.
- Transparency – Detailed analytics provide visibility into media buys and attribution.
- Inventory at scale – Programmatic exchanges give access to millions of publishers globally.
With the ability to serve personalized ads to exactly the right person at the optimal price point and measure everything in granular detail, programmatic drives better performance and outcomes.
Top Demand-Side Platforms (DSPs)
On the buy side, DSPs give advertisers the tools to execute highly targeted and optimized programmatic campaigns. Below are leading DSPs in the market.
Google DV360
Part of Google Marketing Platform, DV360 offers seamless access to Google‘s unparalleled search, YouTube and display inventory. Customizable AI finds the best audiences and automatically optimizes for performance.
Key Features
- Access to Google video, display and mobile apps
- Integrations with Campaign Manager and Google Analytics
- Powerful machine learning optimization
Pros
- Leverages Google‘s unique 1st party data
- YouTube video ad capabilities
- User-friendly workflow
Cons
- Mostly limited to Google-owned channels
- Higher costs than some platforms
The Trade Desk
The Trade Desk is an industry leader valued at over $30 billion offering AI-fueled programmatic capabilities. Brands can reach consumers worldwide across all types of digital media from one platform.
Key Features
- Cross-device identity graph
- Flexible audience segmentation tools
- Third-party tag integrations
Pros
- Independent platform with almost unlimited inventory
- Innovative ad formats like CTV and audio
- Robust reporting and analytics
Cons
- Can be complex for beginners
- Requires more ad operations resources
MediaMath
MediaMath helps brands optimize interactions with consumers through addressability, personalization and measurement. Marketers can design unique experiences across the customer journey.
Key Features
- 1:1 messaging with customer data
- Cross-channel attribution
- Automated audience segmentation
Pros
- Specializes in retail and ecommerce verticals
- Strong data science capabilities
- Custom algorithms tailored to campaign goals
Cons
- Smaller overall exchange relative to giants like Google and The Trade Desk
- Mostly display and mobile video inventory
Top Supply Side Platforms (SSPs)
On the sell side, SSPs allow publishers to generate revenue from programmatic sales of ad impressions while maintaining quality and control.
Magnite
Magnite helps premium publishers scale programmatic monetization through industry-leading video tools, detailed analytics and transparent buyer connections.
Key Features
- Real-time reporting dashboard
- Header bidding optimization
- Direct integration with top DSPs and exchanges
Pros
- Specializes in CTV/OTT monetization
- Leading video SSP capabilities
- Strong buyer demand for Magnite inventory
Cons
- Mostly display and video ads
- Less robust targeting compared to some SSPs
PubMatic
PubMatic provides infrastructure and platforms to automate selling and maximize revenue across devices, ad formats and auction types. Publishers get actionable insights to drive outcomes.
Key Features
- Real-time transaction logs
- Price control levers like dynamic floors
- More than a decade of yield optimization expertise
Pros
- Omnichannel platform covers all environments
- Custom reporting based on unique KPIs
- Global infrastructure and demand
Cons
- Smaller than some competitors in terms of market share
- Complex options better suited to large publishers
Xandr
AT&T-owned Xandr combines differentiated data, premium video inventory and addressable technology solutions to reach specific audiences.
Key Features
- Cross-screen Relevance Score matching
- Flexible access to multiple demand sources
- Curated marketplace with brand protection
Pros
- Innovations in addressability including an identity solution called Xandr LiveRamp
- Second largest video and CTV platform after Magnite
- Global infrastructure and operations
Cons
- Complicated setup and management
- Fees tend to be higher than other SSPs
Top Ad Exchanges
Ad exchanges operate virtual marketplaces enabling automated transactions between sellers of advertising impressions and buyers. Exchanges power the core mechanisms of real-time auctions and bidding central to programmatic advertising.
Index Exchange
Index Exchange processes over 100 billion daily ad impressions with technology purpose-built for transparency, speed and scale. Supporting key initiatives around preparing for the cookie-less future makes Index Exchange the one of largest independent advertising exchanges globally.
Key Features
- Set-it and forget-it controls for optimal yield
- Fraction-of-a-second page load speeds
- Security measures ensuring brand safety
Pros
- Specializes in viewable, fraud-free inventory
- Leading page load speeds
- Robust analytics and yield management tools
Cons
- Does not offer buyer tools like a full DSP
- Smaller niche player relative to giants like Magnite
OpenX
OpenX optimized architecture processes over 100 billion daily ad requests with speed and efficiency across all channels and formats. As one of the world‘s largest programmatic exchanges, OpenX focuses on trust, transparency and tailoring solutions to individual partner needs.
Key Features
- Unified marketplace for direct sales and RTB
- Curates premium long-term partnerships
- Safer advertising controls like malware scanning
Pros
- Global infrastructure with volume to support the largest brands
- Package capabilities for fraud filtering and brand safety
- Known for transparency and being a neutral 3rd party exchange
Cons
- Not as advanced as some exchanges in identity solutions for the cookieless future
- Less customizable than niche exchanges
Programmatic Advertising Trends for 2023
Key developments to watch which will shape programmatic advertising include:
- Alternatives to 3rd party cookies – As Chrome and regulators clamp down on tracking, solutions like Unified ID 2.0, identity alliances and contextual tactics will enable targeting
- Supply path optimization – Advertisers will scrutinize the long tail of intermediaries taking cuts to optimize value
- Retail media networks – Retailers like Amazon, Walmart and Target building closed media platforms on their 1st party shopper data
- CTV/OTT boom – Scaled use of data-driven ads on connected televisions and over-the-top streaming
- Inhousing vs outsourcing – Balancing the tradeoffs of brands keeping programmatic in-house vs relying on agency partners
The Future of Programmatic Advertising
Looking ahead, brands investing in programmatic in 2023 should pick partners to help them address key issues around transparency, fraud, viewability and data ethics. As the digital landscape grows more complex with platforms like Google and walled gardens, marketers need trusted navigators.
With the right strategies and partners, data-driven automated advertising at scale unlocks immense potential for brands in an increasingly fragmented media universe. Programmatic advertising represents the future of digital marketing.
