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Programmatic Or RTB: Know The Difference To Make A Difference

In marketing and advertising, there is no preset formula for success; the best strategy is the one which suits the purpose of the brand or campaign

Photo Credit : Shutterstock


Command over lingo is a must for professionals in digital marketing and advertising because no uniformity in intention and explanation may create a spell of confusions. Programmatic and Real-time Bidding (RTB) are the two most favourite terms among stakeholders in the Digital Marketing industry, and often, they are used interchangeably because only a few understand the distinction between the two. The year 2010 witnessed the unprecedented success of RTB in the display ad industry and from there onward Programmatic started gaining immense popularity. Influenced by it many people have developed a nation that Programmatic is nothing but RTB. Since then, not only outsiders, industry's insiders too, commit this error very confidently. However, there are similarities between them, but they are not synonymous with other. There is a sheer difference between the two popular digital media buying approaches; Programmatic and RTB.

Digital Advertising -The Real Shift  
The last 10 years will always be remembered in the advertising industry as the consumption of conventional media declined drastically all around the world. Computers become a need, and basic phones got replaced by smartphones, and social media devoured the TRP of TV programmes. A shift was obvious, and it happened. The advent of digitisation has disruptively transformed the advertising world and a parallel industry developed inside the industry which is highly advanced, target-based, predictive and measurable - i.e., Digital Advertising. Empowered with Big Data, Artificial Intelligence, and Predictive Analysis, Digital Advertising is the ultimate choice of every smart brand in the current age.  Furthermore, with smart ad space buying tools like Programmatic and RTB, Digital Advertising will continue to it shine in future too.

What exactly is Programmatic  
There are mainly two types of Programmatic ad space buying; Programmatic Direct and RTB. Programmatic Direct is also known as, Programmatic Guaranteed, Programmatic Premium, Automated Guaranteed, and Programmatic Reserved, but are not different at all, they are just different names of Programmatic Direct. So, what is Programmatic? In fact, it is automated media buying on digital landscapes, i.e., web and mobile for the placement advertisements and advertorials. It's an effective as well as the efficient method of media buying to ensure maximum visibility at minimum cost. It equips advertisers with advanced analytical tools and clear insight that enable them to explore potential websites, portals, and digital channels that assure the best ROI from their ad campaigns. In this digital media buying process, the advertiser decides the campaign parameters and the ad server automatically generates ad tags.

What exactly is RTB  

Apart from Programmatic Direct, the other variant of Programmatic is RTB. When buying and selling of ad space occur through an auction and advertisers compete for a particular space with the highest bidding, this sort of Programmatic is known as RTB. Means, RTB is a subset of Programmatic, which is the universe of automated media buying. Hence, all RTBs are Programmatic. In RTB, advertisers compete for both ad space and web impressions. RTB is a faster way of automated bidding, and the ad placement takes place soon after the completion of the auction. Here, the point to remember is that promotions on search engines, social media, emails, and digital marketing channels come under Programmatic, but they are not the part of RTB advertising because RTB is a mechanism of automatic bidding via an auction format in private marketplaces. Also, as the name depicts, RTB is a very much real-time auction process, and the ad uploaded simultaneously with when an advertiser wins a bid.

Which is the Best

In marketing and advertising, there is no preset formula for success; the best strategy is the one which suits the purpose of the brand or campaign. Both Programmatic and RTB are extremely useful in Digital Marketing, and each one scores above than the other in terms of their respective characteristics. While RTB is phenomenal in targeting audiences on their hit and click history, the Programmatic is best for niche brands that keep the focus on a special segment of people as the advertiser in Programmatic enjoys leverage in choosing more relevant and valuable impressions. Mass views and outreach make RTB the hot favourite for FMCG industry, but its limitations regarding the ad spot of choice and getting complete information of the sites give the Programmatic advantage over RTB. That's why for premium lifestyle and luxury brands Programmatic is more effective in reaching to a specific group of people. Hence, Programmatic Direct is ahead of RTB because it helps advertisers to communicate with audiences who have better chances to buy their products or services.

Disclaimer: The views expressed in the article above are those of the authors' and do not necessarily represent or reflect the views of this publishing house. Unless otherwise noted, the author is writing in his/her personal capacity. They are not intended and should not be thought to represent official ideas, attitudes, or policies of any agency or institution.

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Nitin Gupta

The author is Founder and CEO, Xapads Media

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