FAQ on programmatic advertising: Keeping up with automated ad buying – eMarketer

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Programmatic advertising accounts for over 90% of US digital display ad spending, automating the buying and selling of ad inventory through real-time technology. As the programmatic landscape matures, spending is shifting toward private marketplaces, AI-powered optimization tools are reshaping campaign execution, and competitive pressure among demand-side platforms is intensifying. This FAQ covers the fundamentals of programmatic advertising and the trends shaping the market in 2026.
Programmatic advertising refers to any ad that is transacted or fulfilled through automation, where technology handles decision-making in the ad serving process without requiring a manual insertion order. The term encompasses over 90% of US digital display ad spending, according to EMARKETER's Programmatic Advertising Explainer.
What distinguishes programmatic from traditional ad buying is the elimination of manual negotiation. Advertisers and publishers connect through technology platforms that match supply and demand in milliseconds, allowing campaigns to scale across millions of placements. Programmatic transactions occur across display, video, connected TV (CTV), digital audio, and digital out-of-home (DOOH) inventory.
US programmatic digital display ad spending is projected to exceed $180 billion in 2025, representing approximately 92% of total digital display ad spending, according to EMARKETER.
Programmatic advertising connects advertisers with publishers through a real-time auction process. When a user loads a webpage or app, an ad impression becomes available. The publisher's supply-side platform (SSP) sends a bid request containing information about the impression, including the domain, ad specifications, and available user data. Demand-side platforms (DSPs) evaluate this information and submit bids on behalf of advertisers within milliseconds.
The winning bid is selected based on price and any existing priority agreements. The advertiser's ad server then delivers the creative to the user's device. Header bidding, a practice that runs auctions across multiple demand sources before calling the publisher's ad server, has become standard for desktop and mobile web, helping publishers maximize revenue by exposing inventory to more buyers simultaneously.
Two service models exist: managed service, where vendors handle campaign setup and optimization, and self-service, where advertisers control execution through dashboards and tooling.
Programmatic transactions fall into two main categories: programmatic direct and real-time bidding (RTB).
More than 91% of total US programmatic display ad spending flows through PMPs and programmatic direct, according to Basis Technologies. PMP spending is expected to grow nearly 13% in 2025, while open exchange spending grows approximately 3%. This shift reflects advertisers’ prioritization of inventory quality, brand safety, and measurement transparency over bid-price savings.
Programmatic display advertising is the automated buying and selling of banner ads, rich media, and other visual ad formats across websites and apps. Display represents the original programmatic format and remains the foundation of the programmatic ecosystem.
Display inventory spans standard IAB ad sizes, native placements that match surrounding content, and rich media units with interactive elements. Programmatic display ads appear across publisher websites, within mobile apps, and on social media platforms operating as walled gardens.
Video has overtaken non-video display in programmatic spending. US programmatic video ad spend surpassed non-video for the first time in 2022 and continues to grow faster, driven by CTV, mobile video, and social platforms like TikTok, according to EMARKETER.
Four factors are driving the migration from open exchanges to private marketplaces:
The growth of programmatic CTV also contributes to PMP expansion, as most CTV inventory transacts through programmatic direct and private marketplace deals rather than open auctions.
Despite its scale, programmatic advertising presents persistent obstacles:
AI is reshaping programmatic operations from bidding to creative production. Video advertisers report using AI for content creation (60%), creative performance analysis (43%), audience insights (42%), and dynamic creative optimization (40%), according to Teads and MMA Global research cited by EMARKETER.
DSPs are deploying AI-powered bidding systems that analyze historical behavior, purchase intent signals, and real-time engagement patterns to predict which impressions will drive conversions. The Trade Desk's Kokai platform and Amazon DSP both center AI optimization in their value propositions.
On the sell side, NBCUniversal launched AI-powered contextual targeting tools in December 2025 that scan live and on-demand content to match ads with relevant moments. CTV measurement is improving as AI consolidates campaign data across platforms for holistic analysis.
The downside: generative AI enables mass production of MFA content, creating new brand safety risks as low-quality sites exploit programmatic algorithms optimizing for viewability metrics.
Due diligence should address four areas:
Consider diversifying across multiple DSPs rather than centralizing on a single platform to maintain leverage and reduce switching risk.
 
We prepared this article with the assistance of generative AI tools and stand behind its accuracy, quality, and originality.
EMARKETER forecast data was current at publication and may have changed. EMARKETER clients have access to up-to-date forecast data. To explore EMARKETER solutions, click here.
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