Programmatic advertising is a powerful and evolving channel, automating the buying and selling of digital ad space in real-time. But with efficiency comes complexity — and a sea of acronyms, platforms, and technical jargon.
This comprehensive glossary will help you decode the buzzwords and better understand the inner workings of programmatic advertising.
A
Ad Exchange
A digital marketplace where advertisers and publishers trade inventory via real-time bidding.
Ad Fraud
Malicious activity designed to exploit advertising systems for financial gain — such as fake clicks, impressions, or installs. Common types include bot traffic, click farms, and domain spoofing.
Ad Inventory
Total available ad space a publisher offers to advertisers.
Ad Server
A platform that stores and delivers ad creatives, while also tracking performance.
Ad Tag
A snippet of code that requests an ad to be served on a page.
Ads.txt
A publisher-hosted text file listing authorized sellers of their inventory. Helps combat domain spoofing.
Agency Trading Desk (ATD)
A centralized media buying team within an agency, specializing in programmatic execution.
Attribution Modeling
Analyzing which channels or touchpoints contribute to a conversion and assigning value accordingly.
Audience Extension
Technique to extend the reach of a publisher’s audience across the web using third-party data and platforms.
B
Behavioral Targeting
Using past user behavior (search history, page views, etc.) to serve relevant ads.
Bid Request
Data packet sent by a publisher to potential advertisers inviting them to bid on an impression.
Bid Response
A bidder’s reply to a bid request, containing creative, bid price, and targeting parameters.
Bid Shading
An algorithm that reduces how much you pay in first-price auctions — aiming for a balance between cost and competitiveness.
Bidstream Data
The flow of data that is shared during the programmatic bidding process. It includes user-related metadata (such as location, device type, IP address), page content, ad placement details, and other contextual signals.
C
Cookies
Small text files stored in a user’s browser by websites or ad platforms to remember information about the user, such as login status, preferences, or browsing behavior. In programmatic advertising, cookies are used for tracking, targeting, and retargeting purposes.
Click-Through Rate (CTR)
The percentage of users who click on an ad after seeing it.
Contextual Targeting
Targeting ads based on the content of the page (e.g., placing a sneaker ad on a sports blog).
Conversion Pixel
A small code snippet that tracks user actions (like purchases or sign-ups) after ad engagement.
Cost Per Mille (CPM)
The price paid for 1,000 ad impressions.
Consent Management Platform (CMP)
A system that collects, manages, and communicates user consent for data processing in compliance with privacy laws like GDPR.
ConnectAd Green Line
An initiative promoting eco-friendly, low-carbon programmatic buying practices.
D
Data Clean Room
A secure, privacy-compliant environment where multiple parties (e.g., brands, publishers, platforms) can match and analyze user-level data without exposing personally identifiable information (PII).
Data Management Platform (DMP)
Technology used to collect, manage, and activate user data for precise targeting.
Demand Side Platform (DSP)
Software that allows advertisers to automate the purchase of ad inventory across multiple exchanges.
Deal ID
A unique identifier used in private deals between buyers and sellers, often for premium inventory.
Dynamic Creative Optimization (DCO)
A system that dynamically assembles ad creatives in real time based on user data.
E
eCPM (Effective CPM)
A metric used to compare revenue across pricing models. It standardizes revenue per 1,000 impressions regardless of whether you’re paying by click, install, or view.
Exchange Bidding
Also known as open bidding. Multiple ad exchanges compete for inventory in a unified auction.
F
Fill Rate
Percentage of ad requests that are successfully served with ads.
First-Party Data
Data collected directly by a brand or publisher from its own users.
First-Price Auction
The winning bidder pays exactly what they bid (unlike a second-price auction).
Floor Price
Minimum price a publisher sets for inventory.
G
Geotargeting
Targeting users based on their geographical location.
Guaranteed Inventory
Inventory pre-reserved for a specific buyer, typically at a fixed price.
H
Header Bidding
A programmatic technique that allows multiple demand sources to bid on the same inventory simultaneously — before the ad server decides which ad to serve.
House Ads
Internal promotions shown when paid ads aren’t available to fill inventory.
I
Identifier
A unique string (such as a cookie ID, device ID, or hashed email) used to recognize and track a user across websites, apps, or devices. Identifiers help platforms deliver targeted ads, measure performance, and perform frequency capping.
Impression
An instance where an ad is served and has the opportunity to be seen.
Insertion Order (IO)
A legal contract outlining campaign details between advertiser and publisher.
Intermediary
An entity that facilitates the sale of ad inventory on behalf of another seller, but does not directly own or operate the inventory. In programmatic supply chains, intermediaries are common and are flagged in files like sellers.json to provide transparency into who is actually involved in a transaction. They can include resellers, ad networks, or tech vendors.
Invalid Traffic (IVT)
Traffic that doesn’t come from a real user. It includes bot traffic, click farms, and other types of ad fraud. It’s categorized into General IVT and Sophisticated IVT (SIVT), the latter being harder to detect.
K
Key Performance Indicator (KPI)
A measurable metric used to evaluate campaign success (e.g., CTR, ROI, conversion rate).
L
Latency
Time delay between an ad request and ad render. Low latency is crucial for user experience.
Log Level Data
Granular data about every ad impression, including bid values, auction results, and user identifiers — used for advanced optimization and troubleshooting.
M
Media Buying
The process of purchasing ad inventory across digital or traditional channels.
Multivariate Testing
Testing multiple variables simultaneously (headline, image, CTA) to determine the most effective combination.
N
Native Advertising
Ads that mimic the look and feel of the content around them, often labeled “Sponsored” or “Promoted.”
Net Revenue
Revenue left after costs (like platform fees and commissions) are subtracted.
O
Open Auction
A real-time bidding auction open to all advertisers.
Optimization
Making real-time or iterative adjustments to campaign settings or creatives to improve performance.
P
Private Marketplace (PMP)
An invite-only RTB auction where premium inventory is offered to select advertisers.
Programmatic Direct
Programmatic media buying where impressions are guaranteed — skipping the auction process.
Publisher
The owner of digital properties (websites, apps) that sell ad inventory.
Q
Quality Score
A score used by platforms like Google to determine the quality and relevance of your ads, which influences ad rank and cost.
R
Real-Time Bidding (RTB)
Buying and selling of ads in real-time auctions, typically in milliseconds.
Retargeting
Serving ads to users who have previously interacted with your brand or website.
S
Second-Price Auction
A bidding model where the winner pays just above the second-highest bid.
Session
The timeframe in which a user interacts with a website or app.
Supply Chain Object (Schain)
An IAB framework that outlines every vendor involved in serving an ad impression — improving transparency and helping detect fraud.
Supply Side Platform (SSP)
A platform used by publishers to manage and monetize ad inventory by connecting to multiple DSPs.
Sellers.json
A transparency file published by SSPs/ad exchanges that lists authorized sellers and resellers of inventory. It helps buyers verify who is selling inventory and reduces fraud.
T
TCF (Transparency & Consent Framework)
An IAB standard that ensures user consent preferences are captured and shared across the ad tech ecosystem in compliance with regulations like GDPR.
Third-Party Data
User data collected by an entity that doesn’t have a direct relationship with the user (e.g., data brokers).
Tracking Pixel
A 1×1 pixel image used to track ad impressions, user behavior, or conversions invisibly on a webpage.
U
Unique Visitor
An individual user, counted once within a timeframe, regardless of the number of visits.
User Consent
Permission granted by users to collect, store, or process their personal data — typically managed by a CMP.
User ID
A unique identifier assigned to users for tracking and targeting across platforms.
V
Viewability
A measure of whether an ad was actually seen. Standards vary (e.g., 50% of pixels in view for 1 second for display ads).
Y
Yield Optimization
The process of maximizing revenue from ad inventory by adjusting pricing, demand prioritization, and fill strategies.
Final Thoughts
Programmatic advertising doesn’t have to feel like decoding a secret language. With this glossary, you now have a better understanding of the key terms shaping the digital ad landscape.
