How Do Direct Deals Work in Programmatic Advertising?

How Do Direct Deals Work in Programmatic Advertising?

ByBilal Last Updated on -

Direct deals in programmatic advertising are gaining traction due to their efficiency and transparency. This approach enables advertisers and publishers to establish direct connections without intermediaries, enhancing control and performance in ad campaigns. Understanding white label meaning in this context is key, especially if you’re considering launching a white-label DSP or another programmatic advertising solution. 

This article explains how direct deals in programmatic advertising operate, offering insights for those looking to develop or implement white-label solutions.

What is Programmatic Direct?

Programmatic Direct is a method of purchasing advertising inventory in which the advertiser and publisher enter into a deal directly, bypassing the auction. In this case, programmatic tools and technologies are used, in particular, the DSP platform acts on the publisher’s side, and the DSP acts on the advertiser’s side. This allows for the automation of the purchase of advertising inventory in accordance with the OpenRTB protocol.

The method allows the advertiser to buy the required volume of impressions on the desired resources at a fixed price. This is the main difference between Programmatic Direct and the RTB auction model.

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Types of Direct Deals in Programmatic

Types of Direct Deals

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There are two Programmatic Direct models: Preferred Deal and Programmatic Guaranteed.

1. Preferred Deal.

Preferred Deal allows advertisers to buy impressions at a fixed price without participating in an auction. The purchase of an impression occurs when a request for advertising is received. At the same time, all the advantages of programmatic advertising are preserved: automated purchasing, instant placement, precise targeting, etc. However, in this case, there is no guarantee of the number of impressions, since the inventory is not reserved and can be sold to other advertisers.

Here’s how Preferred Deals work:

  • The publisher provides preliminary access to the advertising inventory at a fixed price.
  • The advertiser decides to accept the offer, having received preliminary access to the publisher’s inventory.
  • The DSP platform (the advertiser’s representative) can send requests to purchase advertising space within the proposed conditions. The ad starts to be displayed after each request.
  • The advantages of this ad-buying model are that the advertiser can pre-evaluate the effectiveness of placements on the publisher’s inventory, and then enter into a deal with a guarantee of the number of impressions (Programmatic Guaranteed)                                                                                                                         In addition, the strategy provides the advertiser with priority access to inventory before it becomes available for sale on the private market (PMP) or real-time auction (RTB). Thus, the Preferred Deal can be used as an intermediate option between the open OpenRTB auction and strict Programmatic Guaranteed deals.

2. Programmatic Guaranteed.

With Programmatic Guaranteed, the publisher sells a guaranteed number of impressions at a fixed price. In this case, the inventory is reserved for a specific advertiser in case of purchase.

Let’s look at how Programmatic Guaranteed works.

Let’s say there are two parties involved in the transaction:

  • The publisher, the owner of a website on children’s topics. Let’s say it’s a website with reviews of European baby strollers.
  • The advertiser, who wants to place an ad for baby food on the publisher’s inventory.
  • The publisher and the advertiser agree on the terms, such as the volume of advertising (for example, 1 million impressions), price (for example, $40 CPM), and the placement period (for example, 1 month).
  • The publisher reserves the advertising inventory for a specific advertiser. From this moment on, ads with ads for baby food are automatically placed on the site for 1 month, or upon reaching 1 million impressions. The cost per impression is fixed at $40 CPM.

Since premium advertising inventory is sold through direct deals, websites participating in such deals must meet several important criteria:

  1. The content must be unique and useful for site visitors;
  2. The site must attract the advertiser’s target audience. It is important for companies that the ads are viewed by interested users;
  3. The site must have a minimum of robots and bots;
  4. The site must have sufficient traffic;
  5. The site must not contain content that could harm the advertiser’s reputation;
  6. The site must be technically prepared to display ads. This includes fast page loading, responsive design, and compatibility with various devices.

Types of Auction Deals in Programmatic

Types of Auction Deals in Programmatic

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Auction models in programmatic advertising are divided into two main types: open auction (Open RTB Auction) and closed auction (PMP, Private Marketplace). Let’s consider the main differences between them.

Open auction (Open Marketplace, RTB)

RTB is an online bidding process in which advertising inventory is sold in an automated way through online platforms. During the auction, many advertisers, represented by DSPs, compete for impressions in real-time. On the publisher’s side, there is a DSP platform that puts inventory up for auction, accepts bids from advertisers, and selects the winner. Bidding takes place on advertising exchanges, and the meeting place for publishers and advertisers is advertising networks.


What is Programmatic Direct?

Programmatic Direct is a method of purchasing advertising inventory in which the advertiser and publisher enter into a deal directly, bypassing the auction. In this case, programmatic tools and technologies are used, in particular, the DSP platform acts on the publisher’s side, and the DSP acts on the advertiser’s side. This allows for the automation of the purchase of advertising inventory in accordance with the OpenRTB protocol.

The method allows the advertiser to buy the required volume of impressions on the desired resources at a fixed price. This is the main difference between Programmatic Direct and the RTB auction model.

Private Marketplace (PMP)

A private auction in programmatic advertising is a real-time bidding (RTB) format that allows publishers to create closed groups of advertisers to trade advertising inventory. This is a kind of intermediate model between the open market (Open Marketplace) and direct deals (Programmatic Direct).

The main idea of ​​PMP is to provide advertisers with access to the advertising inventory of certain publishers. Such bidding usually takes place on premium inventory, and the price for purchasing inventory is higher compared to the open market.

Streamlining Your Business with Programmatic Direct Deals

For entrepreneurs and small businesses, every marketing dollar counts. Programmatic direct deals, such as Preferred Deals and Programmatic Guaranteed, offer a streamlined, efficient way to manage advertising campaigns while ensuring maximum ROI. Here’s how incorporating these strategies into your business operations can provide a competitive edge:

1. Predictable Costs for Smarter Budgeting

One of the biggest challenges small business owners face is budgeting for marketing campaigns. With direct deals, you lock in fixed pricing models (e.g., CPM), which means you can predict your advertising spend more accurately. This is especially helpful for startups who need to control costs while optimizing their marketing efforts. No more surprises or bidding wars that push your costs up—just a clear, transparent path to reaching your audience

2. Save Time with Automation and Efficiency

As an entrepreneur, your time is precious. Programmatic advertising’s automated nature allows you to run campaigns without manual intervention. Direct deals further streamline this process, cutting out the middlemen and reducing the complexity of negotiations. By setting up automated rules and ensuring that inventory is available at the right price, you save both time and resources, which can then be redirected into growing your business.

3. Precise Targeting for Maximum Impact

Direct deals give you control over your inventory and placement, ensuring that your ads appear where they’re most likely to generate interest from your target audience. Whether you’re marketing a new product or reaching a niche group, programmatic advertising’s precision targeting helps maximize your reach and engagement, leading to higher conversions and sales

4. Build Strong, Long-Term Partnerships

Direct deals aren’t just about buying ad space—they’re about building valuable, lasting relationships with premium publishers. By securing guaranteed impressions or preferred access to inventory, you create a more stable revenue model for publishers, which in turn encourages long-term partnerships. For your business, this means more consistent visibility, better brand positioning, and a stronger overall advertising strategy

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Differences Between Private Marketplace And Preferred Deals

The main difference between Private Auctions and Preferred Deals is the level of control advertisers have over the ad inventory they buy. In a Private Auction, advertisers have access to premium inventory, but they have to compete with other advertisers to place their ads. Preferred Deals, on the other hand, provide advertisers with guaranteed impressions at a fixed price. This gives advertisers more control over creative placements, making it much easier to plan advertising budgets.

Another major difference is the type of inventory available. A Private Auction most often offers premium inventory that is not available for sale on the open market. Preferred Deals, on the other hand, offer inventory that is available for sale on the open market, but at a higher price. If the inventory is not sold through direct deals, it is offered at an RTB auction.

Final Thoughts

Direct deals in programmatic advertising, including Preferred Deals and Programmatic Guaranteed, offer advertisers more control and predictability compared to traditional RTB auctions. With Preferred Deals, advertisers gain access to inventory at a fixed price but without guaranteed impressions, while Programmatic Guaranteed ensures a set volume of impressions at a fixed cost. These models streamline the ad-buying process, offering automated purchasing, precise targeting, and transparency in pricing. They provide significant benefits for advertisers, such as more accurate budgeting, time savings, and stronger relationships with premium publishers.

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