Glossary of Programmatic Advertising-Part 1

Autor: Affilired

From «A to H».

Programmatic Advertising is the proof of just how important big data has become over the years, the purchase of audience data by advertisers instead of buying advertising space has been a revolutionised Digital marketing. Consequently, it has given us a new vocabulary, expanding it and providing new terms which we need to understand and use, so let’s read on!


Ad Exchange: is one of the most important terms in programmatic advertising. It is the marketplace between digital supply and digital demand. The advertiser who offers the best bid retains the space. The Ad Exchange takes a commission for facilitating the buying and selling of the inventory from multiple ad networks simultaneously.

Ad Networks: a company that aggregated unsold inventory. The platform connects websites with advertising to sell, usually via programmatic exchanges.

Advertiser: is the owner of a brand that decides to advertise its product or service through online channels.

Algorithm: a sequence of operations involved in the automated processes in programmatic advertising. Its function is to generate automatic actions or calculations in relation to the phases that are carried out in online advertising campaigns, such as optimizations and actions in real-time auctions.

Audience: represents those people who interact or are most likely to be interested in your product or service. In this case, in the digital age, the audience are the users.

Automated Guaranteed: A fixed number of ad impressions purchased on a specific web page prior to the scheduled run date.

Banner: is the generalized name for all the ads that appear on a webpage, whether static or dynamic.

Big Data: is the process of collecting a large volume of both structured and unstructured data for further analysis. Traditional media struggle with big data because of both large amount and the complexity of information it contains.

Blacklist: is a series of websites, emails or unwanted IP addresses who for an advertiser contain content that does not suit the brand’s philosophy.

Clusters: audience groups are segmented, based on predefined characteristics or interests, so that impact on the target audience of an advertising campaign is more effective.

Cookie: in online advertising terms, it is understood as a file that contains information about a user. The files are stored in the user’s browser and they collect information about the user´s behaviour on the web for at least 30 days. A user has the right not to be identified with cookies and to may delete them from their browser at any time.

Cost Per Click (CPC): It is the average cost of user click-through. So, advertisers will pay an amount each time a user clicks on an ad.
Formula: total cost / click.

Cost Per Thousand (CPM): Is a model of buying and selling impressions used in online advertising. Basically it is the price of one thousand impressions of an add on a website.
Formula: Total cost * 1000 / number of impressions.

Cost Per View (CPV): Is a purchase model by which the advertiser will pay each time a video format ad is displayed. It is charged only when the viewer watches the video at least 30 seconds. If the video ad has a length of less than 30 seconds, it will be charged when viewed in its entirety.

Cross-Device: this tracking is based on the identification of a user regardless of the device he is using at a specific time (mobile, laptop, desktop…). Cross-device strategies are very important because they help to avoid targeting the same user repeatedly with the same ad or message.

First-Party Data: these are the first-hand data of the advertiser which themselves have collected from their own consumers and audiences. Data about behaviour, actions or interests shown throughout their website, or via Customer Relationship Management, subscription data, social data or mobile web data or apps.

Data Management Platform (DMP): it is a platform in which large amounts of structured and unstructured data are collected, integrated and managed. Allowing the advertiser to define his audience more accurately.

Data Providers: they are responsible for analysing the content of the data collected. This information is arranged regarding the behaviour of the user and depending on the content of the inventory or the degree of brand awareness, as they offer their services to both advertisers and as well other media.

Demand Side Platform (DSP): is the platform allows advertisers to purchase space on websites in real time whether they are displays, videos or mobile. Both Buyers and sellers can be found here.

Display advertising: includes all Internet ads which use various formats such as text, image, or audio and are better known as banners. They can be images, static or dynamic, always with the intention of attracting the user’s attention.

Exclusivity networks: an advertising network whereby the commercialization of the advertising spaces which belong to the network is managed exclusively by the network itself and is not available through third parties.

Hard-Floor Price: is the minimum price an advertiser must bid if he wants to enter the auction.

Keep reading the second part of the programmatic advertising glossary!