11 Programmatic Advertising Terms That You Need to Know

Advertising has largely pivoted away from traditional media and more into leveraging digital solutions for quite some time now. An obvious example is the widespread use of programmatic advertising, an automated ad-buying process in which automation is used to identify a brand’s target audience, determine where these people are online, and then buy digital ad space for maximum visibility.

Chances are you are already into programmatic advertising and are familiar with it. After all, using programmatic advertising can improve the efficacy of your brand’s campaign and ultimately make it stand out. But on the off-chance that you are only getting started with programmatic advertising, rest assured that it will be of big help to your brand’s advertising efforts, especially if you can do it sooner. For that to happen, you must learn about a few key terms that you will encounter extensively the more you leverage programmatic ad buying.

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Ad Server

The ad server is the platform that manages advertising content online. It enables said content to be shown on specific websites. In this sense then, you can think of an ad server as the content management system of online advertisements.

Audience Segment

An audience segment is also known as segmentation, and it refers to how the market is classified or categorised based on various criteria. Families with young children, for example, would be an appropriate audience segment for products advertising baby food or diapers, while the segmentation for athletic wear would likely be active or sports-inclined individuals in the 18–30 age demographic. Determining the audience segment is crucial so you can focus your ad campaign.

Banner Ads

A banner ad is an advertisement displayed on a particular website, which when clicked will lead the user to the website or landing page of the company owning said ad. As in a traditional banner, a banner ad is meant to promote a brand, and it usually contains an image or two or even moving graphics. The idea is to entice people to click on the banner ad so they could be redirected to learn more about the brand or product. 


A blacklist is a compilation of IP addresses suspected of being spam or engaging in fraudulent activity. These are inputted to an anti-spam database, so they are never to be used. Organisations generally keep their own blacklists, but there are also public blacklists that you can check out just to be sure.


You can think of a bot as the digital equivalent of a human. It can do a range of things people usually do, like talking to customers, answering their questions and promoting products. Bots are generally powered by artificial intelligence and machine learning, which enable them to approximate humans to a degree. There are good bots and bad bots, with the former helping out in highly repetitive tasks like customer service while the latter is responsible for “bot traffic”, where bots are used to misrepresent viewership information.

Brand Safety

Brand safety essentially means maintaining your brand’s good reputation when you advertise online. One of the most logical ways to do this is to make sure that your brand’s ads only appear on the right channels or websites and not anywhere where your brand can lose credibility. For example, no brand would want their banner ads found on a website known for promoting hate and baseless conspiracy theories.


When someone interacts with your ad, conversion takes place. Interaction can take many forms, as when people view your video, click on your banner ad, sign up for your promotion or make a call to inquire. The higher your conversion rate, the better your ads are doing.  

Cost per Action

Conversions, except simple clicks, are generally the basis in terms of how you pay your host or the person who owns the website you are advertising in. One common option is cost per action, which is simply the cost of one conversion. Put simply, if someone signs up for a promo code or registers for a free trial of your service, you will pay the host an agreed-upon fee. No conversion means no payment.

Cost per Thousand

Another common payment option is cost per thousand or CPM, with the letter “M” being the Roman numeral equivalent of 1000. In this setup, you as the advertiser will pay the host or publisher a certain amount after the ad reaches 1,000 clicks and views.

First-Party Data

First-party data is the data you gather when someone visits your website and provides personal information, as in a subscription or when giving payment details. This type of data is considered most valuable since it is far more accurate.

Third-Party Data

If there is first-party data, there is also third-party data, or information about people you get indirectly. These may be collected from things like surveys and cookies. Sometimes, this type of data is sold to companies.

The sooner you get up to speed with the ins and outs of programmatic advertising, the faster you will be able to reap its many benefits, like improved productivity, more effective advertising campaigns and automation of repetitive tasks. But for you to fully understand it, make sure that you learn all you can about the terms in this list.

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