PROGRAMMATIC FOR PUBLISHERS An Insider’s Guide to Leveraging Technology to Increase Ad Inventory Value and Profitability NTRODUCTION: WHAT IS PROGRAMMATIC? Just like traditional media, digital media began with a similar buying process of negotiating with a publisher’s account executives on CPM rates/impressions and signing off on an insertion order.

1. PROGRAMMATIC
FOR PUBLISHERS
An Insider’s Guide to Leveraging Technology to
Increase Ad Inventory Value and Profitability

2. 800-284-6020 • inquiry@Bock-Assoc.com
2
CONTENTS
INTRODUCTION: WHAT IS PROGRAMMATIC? 03
PROGRAMMATIC: WHY IS IT IMPORTANT FOR PUBLISHERS? 04
PROGRAMMATIC: STRATEGIES FOR PUBLISHERS 05
PROGRAMMATIC: EXPLOSIVE GROWTH 06
PROGRAMMATIC: WHY THE HYPE? 07
PROGRAMMATIC: THE LINGO 08
PROGRAMMATIC: FOUR TYPES 09
PROGRAMMATIC: CONCLUSION 10

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INTRODUCTION: WHAT IS PROGRAMMATIC?
Just like traditional media, digital media began
with a similar buying process of negotiating
with a publisher’s account executives on
CPM rates/impressions and signing off on an
insertion order.
With the introduction of programmatic media
buying, an advertiser can purchase digital
media within minutes and target a hyper-
granular audience with the use of data.
In simplest terms programmatic is: The
automation of manual media buying and
selling decisions and processes, enhanced
through data.
Before an ad is delivered on a publisher’s
website, an ad navigates through a complex
ecosystem in under a second, check it out!
SSP
DSP
MARKETER
AD SERVER
PUBLISHERS AUDIENCES
AD SERVER
AD EXCHANGE
TRADING DESK
DMP
Designed by Freepik

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Brand-marketing campaigns are also
shifting to programmatic buying as more
premium inventory becomes available and
marketers gain confidence in the benefits of
programmatic trading.
As Procter & Gamble’s chief marketing officer
explains it, programmatic...
“...createsvaluefortheconsumers,andtherefore
createsvalueforthepublisherandforthe
advertisers/brands.(1)
”
Participating in programmatic marketplaces
also enables publishers to tap into new
demand pools, often including advertisers
that do not buy through direct sales. In its
first year of programmatic sales, Condé Nast
UK discovered that 60 percent of its top 50
advertisers that buy programmatically were
entirely new customers (1)
.
PROGRAMMATIC: WHY IS IT IMPORTANT FOR PUBLISHERS?
Programmatic should be viewed as an
opportunity and not a threat to digital sales.
It should be part of every publisher’s core
business strategy.
“Weseeprogrammaticasanopportunity.Wecan
selltargetedaudienceseitherdirectlyorthrougha
programmaticprivatedealatahigheryield,andfree
upinventorywhichcanbesoldtothousandsofnew
buyersontheopenmarket.”
—Senior Executive, eBay Advertising Deutschland (1)
Large advertisers are already allocating
significant portions of their overall budgets to
programmatic. American Express, for example,
has aspired to be 100% programmatic within
18 months (1)
.

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PROGRAMMATIC: STRATEGIES FOR PUBLISHERS
Due to the ever-changing and complex nature of programmatic, it is often difficult for smaller
publishers to internally manage a programmatic strategy. Lack of knowledge, staff talent and vendor
connections are reasons why many publishers choose to team up with an external expert in the field
to ramp up the programmatic and direct sales strategies concurrently.
According to The Boston Group (2)
, which conducted a study of profitability in programmatic
advertising, outperforming companies employ increasingly well-defined approaches to achieve
success, which include:
DEPLOYING a cross-channel, data-driven
sales strategy that encompasses both
traditional, direct and programmatic sales, and
is tailored to the publisher’s market position
and market dynamics.
UNDERSTANDING how and why advertisers
value different inventory and audiences, and
leveraging technology and data to match
audiences to buyers and achieve higher prices.
ASSEMBLING the right technology, both as
an efficient way to access demand and as a
decision engine to maximize revenue.
DEVELOPING the right capabilities (particularly
in sales and yield management) and realigning
their organizations and incentives to support
a cross-channel strategy and programmatic
sales goals.
One publisher in this study built programmatic revenue to more than 50 percent of its digital revenue
while increasing direct sales and total CPMs.

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PROGRAMMATIC: EXPLOSIVE GROWTH
2015 was a tipping point for programmatic advertising, with ad revenue nearing $15 billion. According
to BI Intelligence (3)
:
Both advertisers and publishers are allocating resources and staffing to make programmatic their top
digital strategy.
For the first time this year,
programmatic transactions will be
a majority (52%) of non-search
digital-ad spend. We estimate
30.6% of total digital-ad spend
will go to programmatic real-
time bidding (RTB) platforms,
and 21.7% will go to non-RTB
programmatic.
Real-time bidding is growing
even faster than programmatic
overall, at a five-year CAGR of
24%. RTB revenue will top over
$26 billion by year-end 2020, up
from $8.7 billion this year. Mobile
RTB and video RTB are growing
even faster, at roughly 2X the rate
of programmatic overall.

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PROGRAMMATIC: WHY THE HYPE?
BIG DATA: Within the programmatic
landscape, a DMP (data management
platform) can be plugged in to target niche
audiences. Within the data sets, first-party
or third-party data can be used to target the
marketer’s audience.
PERFORMANCE: Using “big data” helps
eliminate wasted impressions on irrelevant
audiences. Therefore, the chances of a
conversion or KPI is more likely, resulting in
positive ROI.
EFFICIENT: Programmatic buying has
reduced the lengthy, manual digital media-
buying approach by streamlining the dataflow
regarding the terms of the transaction and
performance validation, resulting in a cost
and time savings for both the advertiser and
publisher.
CROSS-CHANNEL: Programmatic is often
associated with display advertising, but the
same technology and algorithms that were
first developed for display ads now translate to
mobile, native, video, etc.
Programmatic is definitely a buzzword that is frequently used in the digital community, especially in
the last couple of years. So, aside from the crazy growth stats, why the hype?

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PROGRAMMATIC: THE LINGO
Many in the industry are guilty of using programmatic and RTB (real-time bidding) interchangeably,
but in fact RTB is just one of four programmatic strategies. This chart (4)
explains the different types
and other terms used in the industry:
Type of
Inventory
Pricing Participation Other Terms Used
in Market
Automated
Guarantee
Reserved Fixed One-One Programmatic guaranteed
Programmatic premium
Programmatic direct
Programmatic reserved
Unreserved Fixed
Rate
Unreserved Fixed One-One Preferred deals
Private access
First right of refusal
Invitation-only
Auction
Unreserved Auction One-Few Private marketplace
Private auction
Closed auction
Private access
Open Auction Unreserved Auction One-All Real-time bidding (RTB)
Open exchange
Open marketplace

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PROGRAMMATIC: FOUR TYPES(5)
Open Auction (common name Real-time bidding): This is the
bread and butter of programmatic and still comprises about 70%
of the programmatic landscape. It is an auction-based model
for unreserved inventory made available to the highest paying
advertisement that fits the targeting criteria.
Please note, the listed programmatic names are IAB-confirmed, but the common industry name is listed next to the IAB formal name.
Invitation-Only Auction (common
name Private Marketplace (PMP): This
is the “sweet spot” of programmatic.
Currently, it comprises about 20%
of the programmatic landscape and
it will only continue to grow as both
advertisers and publishers like the
control of the private marketplace. Just
like the open auction the inventory that
is made available to the advertisement
is unreserved, however, there is
more control on the publisher. The
publisher can set what advertisers
they want running on their websites.
Also, advertisers can cherry-pick what
websites they would like to advertise
on so they have knowledge beforehand
on the delivery.
Unreserved Fixed Rate (common name Preferred Deals):
The advertiser agrees to pay a fixed rate to the publisher on
unreserved inventory, this is done on a one-to-one relationship.
Currently, this comprises about 10% of the programmatic
landscape.
Automated Guaranteed (common name Programmatic Direct):
Unlike the other types of programmatic utilizing unreserved
inventory, this tactic uses guaranteed inventory. This type of
buying is very similar to the traditional media buying process
with an upfront relationship and negotiation. The “programmatic”
piece is that the IO is automated.

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PROGRAMMATIC: CONCLUSION
As a publisher, if you haven’t started thinking about programmatic, now is the time.
Engaging large brands and increasing ad revenue are just two of the many benefits your
publication can realize when you move to a programmatic strategy.
At Bock & Associates, our entire sales team has earned the Interactive Advertising Bureau
(IAB) Digital Media Sales Certification. This certification represents the highest industry
credential for digital media sales professionals. The only globally recognized professional
certification created specifically for digital media sales, the IAB Digital Media Sales
Certification empowers sales professionals to create and sell effective digital campaigns.
To learn how Bock & Associates can help you sell media assets and build your brand with
potential advertisers and advertising agencies, contact us:
800-284-6020 inquiry@Bock-Assoc.com
SOURCES
(1): https://www.bcgperspectives.com/content/articles/media-entertainment-marketing-programmatic-path-profit-
publishers/?chapter=2#chapter2
(2): https://www.bcgperspectives.com/content/articles/media-entertainment-marketing-programmatic-path-profit-publishers/#chapter1
(3): http://www.businessinsider.com/buyers-and-sellers-have-overwhelmingly-adopted-programmatic-with-mobile-leading-growth-2015-3
(4): http://www.iab.com/wp-content/uploads/2015/08/IAB_Digital_Simplified_Programmatic_Sept_2013.pdf
(5): http://www.dnb.com/connectors/breaking-down-programmatic-advertising-buying.html#.VowBv5MrLYV

11. ABOUT: BOCK & ASSOCIATES
Established in 1957 and headquartered in
Minneapolis, MN, Bock & Associates is a sales and
consulting company that assists media companies to
grow revenue. With extensive experience in consumer,
business-to-business and agricultural markets, Bock
& Associates’ insights give its clients significant
advantages in both traditional and digital media. Bock
& Associates works as a passionate advocate for
its media partners by selling their media assets and
building their brand with potential advertisers and their
advertising agencies across the U.S.
Bock & Associates
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Email: inquiry@Bock-Assoc.com
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