Understanding Programmatic Guaranteed vs. Private Marketplace Deals

In the world of programmatic advertising, not all deals are created equal. Beyond the open auction, advertisers and publishers can engage in more direct, controlled transactions. Two prominent types are Programmatic Guaranteed (PG) deals and Private Marketplace (PMP) deals. Understanding their differences is crucial for effective media buying and selling.

Private Marketplace (PMP) Deals:

PMP deals, also known as private auctions or invitation-only auctions, are a step up from the open auction in terms of exclusivity but still involve an auction dynamic.

• How it Works: A publisher makes a portion of their inventory available to a select group of invited advertisers at a pre-negotiated minimum price (floor price). These invited advertisers then bid against each other for that inventory.

• Auction-Based: While exclusive, it's still an auction. The highest bidder among the invited advertisers wins the impression, provided their bid meets or exceeds the floor price.

• Inventory is Not Guaranteed: Advertisers are not guaranteed to win impressions; they are guaranteed the opportunity to bid on premium inventory before it might go to the open auction (if at all).

• Deal ID: PMP deals are typically transacted using a Deal ID, which is a unique string of characters that the DSP uses to identify and bid on the specific inventory package.

• Benefits for Advertisers: Access to higher-quality inventory, increased transparency into where ads will run, and often better viewability or performance compared to the open auction.

• Benefits for Publishers: Ability to command higher CPMs for premium inventory from trusted buyers, more control over who advertises on their site.

Programmatic Guaranteed (PG) Deals:

Programmatic Guaranteed deals, also known as programmatic direct or automated guaranteed, closely resemble traditional direct ad buys but are executed programmatically.

• How it Works: An advertiser commits to buying a fixed number of impressions from a publisher at a pre-negotiated fixed price (CPM). The delivery of these impressions is guaranteed.

• Fixed Price, Guaranteed Volume: There is no auction. The terms (volume, price, flight dates, targeting) are agreed upon upfront.

• Inventory is Guaranteed: The publisher reserves the inventory specifically for the advertiser.

• Workflow Automation: While the deal is negotiated directly, the execution (trafficking, billing, reporting) is automated through programmatic platforms (DSPs and SSPs).

• Benefits for Advertisers: Guaranteed access to premium, often reserved, inventory. Predictable spend and delivery. Ability to use their own first-party data for targeting on this guaranteed inventory.

• Benefits for Publishers: Guaranteed revenue for premium inventory. Predictable forecasting. Strengthens direct relationships with key advertisers.

Key Differences Summarized:

When to Use Which?

• Choose PMP when:

  • You want access to premium inventory but still want some bidding flexibility.

  • You want to increase transparency and control compared to the open auction.

  • You want to build relationships with specific publishers.

  • Your budget is more flexible.

• Choose PG when:

  • You need to guarantee delivery for a high-impact campaign (e.g., product launch, major promotion).

  • You want to secure specific, highly sought-after ad placements.

  • You have a fixed budget and need predictable delivery and spend.

  • You want to replicate the benefits of a traditional direct buy with programmatic efficiency.

Conclusion

Both PMP and PG deals offer valuable alternatives to the open auction, providing advertisers with greater access to premium inventory and more control, while enabling publishers to better monetize their high-value assets. The choice between them depends on specific campaign goals, budget considerations, and the desired level of commitment and flexibility. As programmatic advertising matures, these more direct and transparent deal types are becoming increasingly important for sophisticated media strategies.