How does programmatic advertising work?

Programmable advertising has the following players

1) Publisher- These are companies who would play the ad e.g. Facebook, NBC etc

2) Supply side platform- Supply side platform allows publishers to manage their ad inventory and help them sell it e.g. AppNexus, Google Ad Manager

3) Media buyer- These are companies who want to buy ads e.g. Nike, Mcdonalds

4) Demand side platform- These platforms allow media buyer to buy ads e.g. Tradedesk, Doubleclick

5) Exchange- The exchange brings supply side and demand side platforms together e.g. EngineMX

Lets say a user logs into CNN

a) CNN has a certain section of the page that it want to let out for advertising, CNN will share that information with Supply Side Platform

b) Lets say Nike wants to place an ad on a news agency, it will direct its demand side platform to do.

c) The supply side and demand side platform will match their needs on the exchange. Once the terms are matched, the ad shows up on device

d) Sometimes it happens the ad buyer wants a directed customer base e.g. customers in age range of 25-30 years based out of LA. In this case, they might use a platform called DMP. Data Management Platform e.g. Neilson

The process of matching supply and demand side transaction is called 'Real Time Bidding' or RTB