Tips for Publishers

Programmatic Spotlight: Advantages of Private Exchange (PMP) Deals

4 Minute Read |

Jane Handel

Jane Handel
Product Marketing Manager

Are you excited about programmatic private exchange deals? We’ve got all the reasons why you should be. First, let’s go back to the basics.

What are Private Exchanges?

A Private Exchange is a particular type of programmatic auction. Unlike an open exchange, where infinite buyers and sellers can connect, Private Exchanges are built for a single publisher to work with a small selection of choice marketers/advertisers/DSPs.

Publishers get to choose who can participate in their private exchange deal. Participating bidders get a time-sensitive deal ID, which grants them access to the auction. Just like an open auction, bidding happens in real time, the highest price wins, and inventory is not guaranteed.

What Are Some Other Names for Private Exchanges?

These deals are known by many different names. They are sometimes called Private Marketplaces (PMP), PMP Programmatic, Private Auctions, or Invitation-Only Auction. At Smaato, we call them private exchanges, but sometimes borrow the PMP abbreviation. Whatever you call it, the Private Exchange offers major benefits for publishers and marketers alike.

What are the Key Advantages of Private Exchanges?

Private Exchanges offer tons of advantages.

Privacy-Law Compliant Contextual Targeting

As privacy laws and regulations evolve, third party tracking, cookies, and personal identifiers (like IDFA) will soon be a thing of the past. How do you reach the right audiences in this changing world? The secret is contextual targeting. This way, you are reaching users based on where they are/what content they engage with, rather than who they are. You don’t need any personal information to reach a gamer if you know that they are streaming CTV via an Xbox, or to get in front of car aficionados searching on a motor parts website.

Private exchanges can come in handy here. Publishers can hand-select relevant marketers to participate in their auctions, and because they have more control over who is bidding on their inventory, publishers can align their own content with potential ad content. This delivers a strong user experience, where contextually relevant advertising helps supplement their experience, rather than distracting from it. Meanwhile, advertisers are more likely to get in front of an audience that wants to engage with their ad content. It is a win-win!

Premium Content for Advertisers, and Better eCPMs for Publishers

In many ways, you get what you pay for. Private exchanges often come with higher price tags, since publishers will save their choicest inventory for these auctions. Premium content yields higher eCPMs, and helps advertisers reach their desired audience. These placements tend to yield stronger impressions and better engagement, so advertisers and marketers are willing to pay a premium. (Plus, publishers get more control over setting floor prices.)

Quality Advertisers/Marketers

Publishers pick participants, so they can help ensure top-quality marketers and advertisers participate in their auctions. This further helps guarantee brand-quality and safety. In the theme of transparency, publishers also get to see what creative would run, giving them better control over their site or app content.

Basically, private exchanges offer excellent transparency for both buyers and sellers.

Private Exchange Deals for OTT/CTV Advertising

Private exchanges are not limited to certain types of inventory. At Smaato, we make it simple to monetize OTT/CTV inventory using private marketplace deals.

All of the benefits above can be enjoyed by OTT publishers. In fact, most ad spend for OTT is in the form of PMPs. This helps provide greater transparency for publishers and marketers, and ensures a safer marketplace. With the trust of direct deals, and the scaling opportunities of programmatic deals, PMPs are a great solution for publishers and marketers in the OTT/CTV space.

At Smaato, we can run PMPs on the slot level, pod level, and for a variety of different targeting configurations. That includes geos, devices, first-party data, channel, content, ad break, pod sequence, date range, day, time, and more!

Learn More About Private Exchange Deals

PMP deals now outpace open exchanges, and are quickly becoming industry standard. They offer peace of mind for publishers, and marketers get more insight into where their ads will run.

Are you excited about the benefits private exchanges offer? To learn more about them, check out our complimentary guide to programmatic auction types, or get in touch to learn more about setting up private exchange deals in SPX.

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