The Role of AI in Programmatic Advertising

30/06/ 2023   |   USource Team  |   Digital Marketing

Programmatic advertising is the automation of the ad implementation process.
Paid advertising implementation entails buying an ad space and that whole process. So even though digital paid advertising is miles ahead of its traditional counterpart, manual media buying is still an expensive and time consuming process.

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You have to manually reach out to the publishers, send your proposals, negotiate with pricing, and do the whole dance just to have an opportunity to bid and have a chance to show your ads.

Programmatic Advertising removes all of that by using algorithms and data to make the media buying faster, cheaper, simpler, and more efficient.

Instead of talking directly to publishers and negotiating, you just need to interface with 3 main software platforms in programmatic advertising:


1. Sell-Side Platform (SSP) – the software platform that allows publishers to sell their ad space to potential advertisers
2. Demand-Side Platform (DSP) – the software platform that enables advertisers to buy ad spaces
3. Ad Exchange – connects the SSP to the DSP. This is where the bidding process comes into play.

With programmatic advertising, buying media also involves selling media. Advertisers are constantly competing for a space. So when an advertiser bought a space and saw that it wasn’t really performing, they could opt to sell it to other advertisers.

The SSP ensures that the value of the ad space is maximized for the publisher. But in order to counteract abuse, the Ad Exchanger performs a bidding system in order to make it fair for the advertisers. Then the DSP ensures that the ads are displayed to the optimal audience.

While the programmatic advertising process might seem time consuming, this process happens in just mere seconds. That’s how fast programmatic advertising is compared to manual paid advertising.

And rather than just contacting one advertiser to one publisher, the SSPs and DSPs connect multiple publishers to multiple advertisers making it more efficient than manual paid advertising.

AI’s Crucial Role in Programmatic Advertising


All of the 3 software platforms in programmatic advertising are powered by Artificial Intelligence (AI) and machine learning.

First, AI helps contact multiple publishers and all their available ad spaces for SSPs. It also helps to determine which spaces are more valuable to advertisers, which maximizes the profits for the publishers. The AI also inventories all the available spaces to make it easier for the publishers to get the right space for them.

Then, AI also helps pick out the best spaces for publishers to use through the DSP. It searches based on the categories that the publisher focuses its bidding on and chooses the most appropriate space for the bidders.

Lastly, the AI makes sure that the bidding process is as smooth, as fast, and as fair as possible.

Artificial Intelligence and machine learning shines through repetitive, iterative, and adaptive tasks. In order for programmatic advertising to be possible, the AI needed to be robust.

And at this point, it’s really safe to say that the recent advancements in AI is sufficient enough to make programmatic advertising a thriving industry.

Why You Should Look Into Programmatic Advertising


Because AI does not need too much compensation or benefits to work, it also makes the process cheaper for advertisers.

While digital advertising makes it possible for small businesses to already compete in advertising, programmatic advertising makes it possible for startups and other small enterprises to advertise competitively.

One example is charity-based organization in the UK, Child Rescue Alert. Because it’s a charity, it doesn’t really have the budget to pay for advertising and make its critical information be seen by as many people as possible.

But in 2016, they moved from manual to programmatic advertising. They made their reach even wider, resulting in more information about missing kids, and saving more children in the process.

Programmatic Advertising Platforms

Here are some of the top Programmatic Advertising Platforms:


  • Google Ads – Google ads is already a DSP. But it’s only limited to its own inventory. We use the term “limited” loosely here because the Google Ads network contains millions of websites and ad spaces.
  • Adobe Advertising Cloud – provides an omnichannel catalog of ad spaces ranging from TV, mobile apps, DOOH (Digital Out of Home), audio, video, display, and social
  • AdRoll – offers a free package for startups and small businesses. Has 15 years of experience in Programmatic Advertising
  • Pubmatic – has all 3 programmatic platforms: SSPs, DSPS, and Ad Exchange. A one-stop shop for programmatic advertising.

AI’s Role in Completing the Paid Advertising Process

Programmatic advertising only focuses on the implementation phase of online advertising. But it can also help in the preparation and analysis of ads.

  • We already have AI content creation software that aids graphic designers and copywriters.
  • Creating a customer persona can be more accurate if you use machine learning to sort through all the customer demographics
  • Platform AI can help transactions easier by learning and providing processed data to its users
  • Targeting and retargeting will be more accurate and faster, ensuring that only the right ads at the right frequency will be shown to the right customers

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And that’s just the beginning. Now that AI and machine learning is almost reaching its maturity, we can think of more and more processes that we can optimize.