Sarah Moss
September 18, 2025
21
minutes read
Programmatic video advertising is now the default way U.S. marketers buy video—fast, data-driven, and accountable. Start here to learn the mechanics, choose the right formats, and build a 2026 plan you can run.
Programmatic video advertising automates the buying and selling of video impressions across CTV, online video, and social environments. Instead of negotiating placements one by one, demand-side platforms evaluate each impression in milliseconds against your audience, price, and performance targets, then bid only when the opportunity matches your goals. The result is scale with control and reporting that ties spend to outcomes like completion rate, incremental reach, and conversions.
Why this matters now: video budgets are shifting into programmatic pipes at pace. U.S. CTV ad spend alone is forecast to reach roughly $33–34B in 2025 as streaming supply expands and more premium inventory becomes biddable. At the same time, analysts expect programmatic to account for virtually all net growth in display dollars in 2025, underscoring how automated trading has become the industry’s engine for expansion.
This article is a practical field guide for advertisers, agencies, and brand leaders. We’ll define what programmatic video is, map the ecosystem, and lay out the major formats—CTV/in-stream, out-stream, native/in-feed, and interactive. You’ll get strategies that actually move KPIs, the measurement that matters, the real-world challenges to plan for, and a clear view of what’s next as CTV scales, identity shifts to first-party and retail data, and AI-driven optimization becomes standard practice.
Programmatic video advertising uses automated technology to buy and place video advertisements across digital channels. Instead of humans negotiating each ad placement, software systems evaluate available ad inventory, match it against advertiser requirements, and complete transactions in real time. This process typically happens in under 100 milliseconds, faster than a webpage loads.
The mechanics involve several key players:
When a viewer clicks play on a video, the publisher's system sends out a bid request containing anonymous information about the user and context. Multiple advertisers evaluate this opportunity instantly, submit bids if interested, and the highest bidder wins the right to show their video ad.
This process repeats billions of times daily across websites, mobile apps, and streaming services. The sophistication lies not just in the speed but in the intelligence applied. Modern programmatic systems analyze vast amounts of data to predict which impressions will deliver the best results for each advertiser's specific goals.
⚡ In short, it’s impression-level, data-driven video buying that trades speed and precision for manual negotiations.
Traditional video buying relies on insertion orders, fixed placements, and broad audience demos bought in advance (e.g., TV upfronts). Delivery is locked in, optimization is limited, and reporting is aggregated.
Programmatic evaluates each impression individually, prices it dynamically, and adapts mid-flight based on performance. You control frequency, brand suitability, and supply paths, while measurement goes beyond gross ratings to metrics like completion rate, incremental reach, site visits, and conversions.
💡 For a deeper primer on media buying workflows, see TV Media Buying: What Is It & How Does It Work?
Programmatic video gives you granular controls the old IO model never could: who sees your ad, how often, where it runs, and what it costs—updated continuously as performance rolls in. The payoff shows up in four areas that matter most to buyers.
⚡ Net effect: programmatic video aligns investment with outcomes—delivering reach, relevance, and accountable results without the drag of manual buying.
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Here’s what you gain in practical terms. Programmatic video turns your plan into a system that buys efficiently, targets precisely, adapts in real time, and spends where return is highest. Let’s break those advantages down.
Programmatic replaces manual insertion orders with software that evaluates each impression and bids in real time via OpenRTB, giving buyers faster activation, tighter controls, and the ability to optimize while campaigns run.
The IAB’s 2024 digital video study explicitly cites programmatic buying for better ROI, easier optimization, and control over variables like frequency capping, especially in CTV.
Targeting moves beyond broad demos to first-party audiences, retailer commerce data, and privacy-safe collaboration in clean rooms.
Disney Advertising’s partnership with Walmart Connect enables audience matching and closed-loop measurement across Disney’s streaming inventory, a live example of retail data powering TV-scale buys.
IAB’s State of Data 2024 and retail-media guidance highlight clean rooms and first-party data as core to addressability going forward.
Because impressions are auctioned individually in real time, bids, budgets, and creative can be adjusted mid-flight against metrics like completion rate, on-target reach, and pacing.
Buyers also report that programmatic CTV provides more granular measurement and frequency control across multiple streaming partners—capabilities the IAB flags as key reasons teams lean into programmatic execution.
Efficiency gains are measurable. The ANA’s 2024 Programmatic Transparency Benchmark found that for every $1,000 entering a DSP, $439 now reaches consumers, a +7.9 percentage-point improvement versus the prior benchmark—driven by cleaner supply paths and reduced spend on made-for-advertising (MFA) sites.
Follow-on reporting shows the same trend continuing into 2025, with participants directing a larger share to effective, quality impressions.
Programmatic video spans several formats, each suited to a different job—reach, engagement, or action. We’ll outline when to use each and the metrics that matter (think VCR, viewability, and CPCV) before you dive into setup.
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In-stream video runs inside a player the viewer chose—before, during, or after the content. It’s the closest digital analogue to a TV spot and is generally considered premium because attention is already anchored to the content.
Most CTV in-stream inventory is non-skippable, which drives strong completion and brand impact; recent IAB guidance also tightened what qualifies as true in-stream, reducing mislabeled supply and improving quality signals for buyers.
Outstream (sometimes called accompanying content or in-article) plays outside a dedicated video stream—within articles, feeds, or between content. It expands reach beyond pre-roll supply and often starts muted on scroll, so success depends on placement quality and creative built for sound-off viewing (captions, strong opening frames).
IAB and IAB Tech Lab updates help buyers distinguish outstream from in-stream, and the MRC viewability baseline for video (50% of pixels in view for 2 continuous seconds) is a practical floor for evaluating inventory.
Outstream and in-feed video should work without audio: strong first frame, clear captions, large typography, and a visible brand cue in the first two seconds.
Native/in-feed video matches the look and feel of the surrounding experience (publisher feed, recommendation units, social-style feeds) and is designed to be additive rather than interruptive.
The IAB Native Playbook defines native types and evaluation criteria; for video, that means aligning headlines/thumbnails with context and building “thumb-stop” intros that work without sound.
Interactive video layers actions (choice cards, overlays, QR codes) on top of the spot; shoppable video connects directly to product detail or cart.
On CTV, these formats are gaining traction: Innovid reports interactive CTV campaigns deliver several-fold higher engagement than standard pre-roll, and publishers are bringing commerce to live sports and streaming through retailer partnerships and QR-based flows.
Retailers and platforms are testing shoppable TV to shorten the path from discovery to purchase, with clean-room measurement tying exposures to sales.
Under the hood, a few core systems decide which ad wins each impression in milliseconds. We’ll start on the buy side with DSPs, then move to SSPs and exchanges that run the auctions, and finally the data and AI that guide targeting and optimization.
A DSP is the buyer’s system of record: you set goals, audiences, brand-safety rules, bids, and budgets, then the platform evaluates each impression and bids in real time across exchanges and supply partners.
In practice, DSPs aggregate access to inventory, apply targeting (first-party, contextual, modeled), cap frequency, and optimize delivery toward your KPIs using the OpenRTB protocol.
💡 Learn the basics in Demand side platform (DSP): what is it & how does it work, or go deeper in Rethinking the value proposition of DSPs in today’s programmatic landscape.
An SSP is the publisher’s sell-side technology. It receives ad requests, packages inventory, calls demand sources, runs or participates in auctions, enforces pricing rules, and exposes transparency signals (ads.txt, sellers.json) so buyers can verify the supply path.
In video and CTV, SSPs also orchestrate podding, ad quality controls, and header bidding/unified auctions.
💡 Read Supply-side optimization with AI to see how AI-led SPO and supply-chain checks cut waste, then explore Smart Supply—our outcome-led, DSP-agnostic service that custom-builds deal IDs around your KPIs, neutralizes platform inventory bias, strips bid-hop waste and IVT via direct, brand-safe paths.
Exchanges are the neutral marketplaces where impressions are auctioned.
A bid request (with context, device, and placement details) is broadcast to connected DSPs using OpenRTB; eligible campaigns respond with bids; the highest bid wins and the creative is served—typically in ~100 ms.
Most programmatic video now clears in first-price auctions, a shift that increased transparency versus legacy second-price mechanics and is codified across major platforms.
OpenRTB 2.6 also introduced features tailored to CTV (e.g., pod bidding) to make TV-like ad breaks work programmatically.
Programmatic video targeting increasingly relies on first-party data, clean rooms, and contextual intelligence as third-party identifiers recede.
U.S. marketers report stepped-up investment in clean rooms and consented data collaboration to build actionable audiences and measure outcomes safely.
On the execution side, DSP algorithms use historical and live signals to set bids, pace budgets, sequence creative, and optimize toward VCR, vCPM/CPCV, or CPA goals.
Expect continued gains as AI helps predict attention, refine look-alikes, and personalize creative at scale.
💡 Check out Elevate—our AI planning and optimization tool that builds cross-DSP plans in seconds, forecasts outcomes, and lets you query results in plain language.
Winning with programmatic video is mostly about discipline: define the outcome, choose the few metrics that prove it, and let everything else flow from that plan.
Before you pick formats or data partners, get agreement on goals, guardrails, and how success will be reported. We’ll start by setting clear campaign goals.
Start with one primary outcome and 1–2 secondary metrics per campaign.
These objectives cascade into tactical decisions:
The programmatic platform's algorithms optimize differently based on the selected goal, making this foundational choice critical.
Recent IAB work shows buyers are weighting business outcomes as the top KPI for digital video, with programmatic adoption rising because it enables tighter control and faster optimization against those goals.
Format selection in programmatic video requires balancing creative vision, campaign objectives, and practical realities of inventory availability and cost. Each format carries inherent strengths and limitations that smart strategists exploit rather than fight against:
Format mixing often yields optimal results. 60% of marketers report their multichannel campaigns meet or exceed KPI expectations most of the time. A sophisticated strategy might sequence formats based on the customer journey: broad CTV awareness, followed by mobile retargeting, culminating in interactive desktop video for high-intent audiences. The key lies in purposeful selection rather than defaulting to familiar formats.
Data strategy increasingly separates programmatic winners from those merely participating. As privacy regulations tighten and cookies crumble, the quality and application of data becomes more critical than quantity. Smart advertisers build robust first-party data assets while strategically supplementing with compliant third-party sources.
Therefore, create a layered audience plan. Start with first-party CRM/site audiences (hashed), enrich with retail media or other high-fidelity partners, and fill scale gaps with contextual and modeled cohorts.
Adoption of privacy-preserving collaboration (especially data clean rooms) has accelerated as identifiers deprecate, and retail media tie-ups bring shopper data and closed-loop measurement to streaming inventory.
📌 Pro tip: document your data permissions and match rates by partner up front; set realistic delivery tiers (1P > retail/partner > contextual) so pacing doesn’t stall.
Overexposure kills campaigns. Studies show that after about 4 exposures to the same creative, the likelihood of conversion drops by ~45%. Yet roughly 19% of ad impressions are seen more than five times by the same person within a month. Smart frequency management prevents waste while ensuring sufficient exposure for message retention.
One plan, one cap: Cap frequency at the household level for CTV and set a total cross-channel cap in your DSP so exposure stays reasonable across CTV, online video, and social.
Optimal frequency varies by format, objective, and audience:
Cross-platform frequency management presents technical challenges but delivers superior results. Users who see the same ad on CTV, mobile, and desktop need holistic capping across all touchpoints.
Leading DSPs now offer unified frequency management, though gaps remain when campaigns span multiple platforms or walled gardens. Advertisers must actively monitor true frequency through cross-platform measurement tools.
Brand safety requires equal vigilance.
92% of video advertisers cite brand safety as at least "moderately significant," with 73% calling it "very significant".
Pre-bid filtering through verification partners like DoubleVerify or IAS prevents ads from appearing alongside inappropriate content. Inclusion lists limit buys to pre-approved publishers.
Contextual suitability goes beyond simple safety, ensuring ads appear in environments that enhance rather than diminish brand perception.
💡 For policy and control patterns, see Safety in programmatic advertising.
Retargeting transforms video from broad awareness into a precision instrument for moving prospects through the purchase funnel. By showing video ads specifically to users who have already interacted with a brand, retargeting delivers relevance that drives superior performance metrics.
Sequential storytelling becomes possible through retargeting. Initial video exposure might introduce the brand story broadly:
This narrative approach builds consideration more effectively than repetitive messaging.
Technical execution requires proper pixel implementation and audience segmentation. For instance, website visitors segment by pages viewed, time spent, and actions taken, while video viewers segment by completion percentage and engagement. These granular audiences enable tailored messaging that speaks to specific interests and intent levels.
In short, treat retargeting as a guided, albeit (ideally) short path:
Suppress converters, use simple recency tiers (for example 7, 14, and 30 days), and refresh creative on a schedule to prevent fatigue.
Most important, align the logic with your measurement plan: set a clear view-through window and, where possible, run lift or geo tests so you’re optimizing for incremental impact, not last-touch noise.
Modern consumers don't distinguish between channels; they simply engage with brands across touchpoints.
75% of shoppers use multiple channels before purchase, making integrated strategies essential rather than optional.
Programmatic video must work in concert with other channels rather than in isolation.
Therefore, plan “total video” in one place. Treat CTV, online video, and linear as a single reach pool, de-duplicate audiences, and set a shared frequency cap so exposure stays reasonable.
Let programmatic reallocate budget in flight toward the channels delivering the next incremental reach point or the strongest CPCV.
Most importantly, use unified reporting (DSP data, verification, brand-lift) and a shared taxonomy for audiences and creatives; consistent naming and IDs make it easier for each exposure to build on the last.
A good measurement plan starts with eligibility (was the ad truly served and viewable?), then moves to delivery (who you reached and how often), and ends on outcomes (what changed).
Below is a concise KPI stack with guardrails and the best available 2025 benchmarks.
Before you look at results, verify the basics: were impressions truly viewable, free of invalid traffic, audible when required, and delivered in the right placement. Use these checks to filter noise from your reporting:
Next, confirm how many unique people you reached, whether they matched your audience definition, and how often they saw your ads. These controls prevent waste and overexposure.
For video, message delivery is about how much was watched. Track completion rate and quartiles by channel and publisher to inform creative length, pacing, and pod position.
When formats invite action, measure what people do, not just what they see:
Price without context misleads. Normalize spend to quality and outcomes using vCPM and CPCV so you can compare inventory on equal footing.
If awareness or consideration is the goal, prove movement with lift studies and validated attention signals. Report deltas, not anecdotes.
Tie exposure to business results with clear attribution windows and consistent models. Use holdouts or geo tests to separate causation from correlation.
How you buy matters. Track which paths consistently deliver real, viewable impressions and how much of each dollar reaches consumers, then redirect spend accordingly.
Lock KPIs, viewability threshold, attribution model, and your VTC window in writing. It prevents “moving goalposts” and makes optimizations comparable.
Use this quick checklist to standardize reporting across partners and make optimizations comparable. If a metric isn’t here, it’s probably optional for routine reviews.
📌 Tip: lock definitions and windows in the IO (or in a measurement addendum) before launch—especially for viewability thresholds, attribution model, and VTC window—so optimizations change results (but not the rules).
Programmatic video’s strengths in speed, scale, and data can become weak points without guardrails. The issues below are the ones that most often erode performance and trust. Treat them as design constraints: address them up front, monitor weekly, and plan time to remediate.
Fraudsters follow the money, and video/CTV is a rich target.
DoubleVerify reports that bot fraud accounted for 65% of all CTV fraud in 2024, a higher share than in other digital channels.
Adweek likewise estimates that 16.73% of global ad transactions are affected by fraud—evidence that the problem remains stubborn despite years of countermeasures.
What to do:
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The golden age of unfettered data access has ended.
GDPR, CCPA, and emerging regulations worldwide place strict requirements on personal data usage. Platform changes compound regulatory pressure, with Google Chrome's planned third-party cookie deprecation representing a watershed moment for digital advertising.
On top of that, a growing patchwork of U.S. state privacy laws creates divergent consent and data-use requirements that raise compliance complexity.
What to do:
A meaningful share of people block or avoid ads, with higher rates among younger, tech-savvy demographics. Video ads bear particular responsibility for driving adoption, with excessive frequency and disruptive formats pushing users to seek relief. In fact,
What to do:
The path forward demands balancing monetization needs with respect for user preferences.
Programmatic's complexity creates opacity that challenges even sophisticated advertisers. Many buyers note "transparency problems and convoluted supply paths" plague programmatic channels, with nearly all advertisers expressing frustration. Multiple intermediaries between advertiser and publisher obscure true costs and placement quality.
Each hop in the supply chain extracts fees while adding potential for fraud or misrepresentation. An advertiser might pay $30 CPM, but the publisher receives only $10 after various platforms take their share. This "ad tech tax" reduces efficiency for both buyers and sellers while funding unnecessary intermediation. Worse, complex paths make it difficult to verify where ads actually appeared.
Made-for-advertising (MFA) sites exemplify quality concerns. These properties exist solely to monetize through advertising, offering minimal content value surrounded by excessive ad placements. While technically brand-safe, they provide poor user experience and questionable attention quality. Advertisers unknowingly fund these operations through programmatic buying focused solely on low CPMs.
What to do:
Repetition without variety erodes attention and brand sentiment. When programmatic campaigns optimize for reach and frequency without creative variety, audiences quickly tire of seeing identical messages.
Insider Intelligence flagged CTV overexposure as a top marketer concern in 2024–2025.
Attention data from TVision shows viewers pay markedly less attention when the same CTV creative repeats close together.
What to do:
Rotate lengths and variants every 4–6 weeks (or sooner if VCR and interaction soften). Use DCO for small changes; swap full cuts when fatigue appears.
The next 12–24 months will be defined by four shifts: CTV’s continued scale-up, creative that adapts in real time, interactive commerce from the screen, and cross-device planning with cleaner measurement. Here’s what to expect and how to get ready.
Streaming is now America’s primary TV environment. Nielsen’s Gauge put streaming at 47% of total TV usage in July 2025—outpacing broadcast and cable combined—as viewers continue to abandon linear for on-demand services.
Advertising is shifting just as quickly. Half of all CTV/OTT ad spend was expected to go programmatic in 2024, signaling a tipping point in how TV is bought and sold. Upfront deals now fold in programmatic guarantees, while addressable capabilities move targeting from broad demos to household precision.
The blend of TV-quality content with digital targeting creates new advantages: 83% of CTV advertisers say its value rivals or exceeds primetime, citing better targeting and measurement. CTV reaches cord-cutters beyond linear while still delivering a safe, high-attention environment.
Innovation is pushing the medium further.
With smart TV adoption near saturation and streaming platforms multiplying, CTV is cementing its place as programmatic video’s crown jewel.
📌 What it means: expect more biddable premium supply, heavier use of curated deals, and stricter controls around pod position, competitive separation, and household frequency as CTV scales.
Creative is getting faster and more adaptive. Recent eMarketer coverage shows audience-level customization is the top genAI use case for video, and the share of marketers using AI for image/video creation is nearing half of the market.
McKinsey reports genAI usage now spans most business functions, including marketing, which accelerates testing and versioning of video assets.
In parallel, DCO is evolving with genAI to swap scenes, copy, offers, and CTAs by audience or context—useful as identifiers fragment and contextual signals rise.
💡 For a deeper take, see our POV: GenAI in creative media strategy
📌 What to do next: build creative taxonomies (length, hook, offer, CTA), wire DCO to first-party and contextual triggers, and set guardrails so automated variants still meet brand and regulatory standards.
CTV is becoming action-oriented.
Interactive CTV units (overlays, product galleries, choice cards, QR) are delivering meaningful “time earned” beyond the spot, and QR usage has more than tripled year over year in some benchmarks.
Retailers and platforms are piloting shoppable TV and closed-loop reporting; eMarketer tracks tens of millions of U.S. “shoppable media buyers,” and platform studies (e.g., Roku with Dentsu) show rising consumer openness to buying from the screen. Expect more retail-data integrations, clearer attribution via clean rooms, and standardized interaction metrics (scan rate, add-to-cart, dwell).
📌 Practical tip: design CTV spots with a distinct on-screen prompt (QR or short code), align the offer with the context, and measure both completion and interaction so optimizations don’t trade one for the other.
Planning and measurement are converging.
More than half of CTV/OTT budgets are now handled by integrated or hybrid teams, and a strong majority of advertisers say combining linear with CTV improves ROI and ad recall—a signal to plan “total video” with de-duplicated reach and shared frequency caps.
Cross-media tools from Nielsen aim to provide deduplicated, unified reach and frequency across linear, streaming, and digital, which helps allocate programmatic dollars where marginal reach is cheapest.
Technical standards and user experience design will determine adoption speed. Inconsistent implementation across platforms currently creates friction. Some interactions feel natural while others interrupt the viewing experience. As the industry develops best practices and technical standards, interactive video will transition from novelty to expectation, particularly for performance-focused advertisers.
💡 For broader context, see Media trends 2025.
📌 Execution checklist: unify household IDs where possible, cap total frequency across CTV/OV/social, insist on pod-level controls in CTV deals, and report “cost per incremental reach point” alongside CPCV and VCR.
Programmatic video is now the operating system for U.S. video buying. It delivers scale with control, sharper targeting through first-party and retail data, and optimization that can move real business outcomes. The trade-offs are manageable: protect against IVT, cap frequency across screens, curate supply paths, and measure incrementality. With CTV scaling and privacy standards hardening, the winners will pair disciplined measurement with creative that’s built for the context it runs in.
Five practical moves to put in play now
If you’d like a plan, an audit, or a build that puts these pieces to work, reach out to AI Digital. We can help with strategy, Smart Supply curation, Elevate-powered activation, clean-room setup, DCO, and a measurement framework that proves impact.
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Inefficiency
Description
Use case
Description of use case
Examples of companies using AI
Ease of implementation
Impact
Audience segmentation and insights
Identify and categorize audience groups based on behaviors, preferences, and characteristics
Automated ad campaigns
Automate ad creation, placement, and optimization across various platforms
Brand sentiment tracking
Monitor and analyze public opinion about a brand across multiple channels in real time
Campaign strategy optimization
Analyze data to predict optimal campaign approaches, channels, and timing
Content strategy
Generate content ideas, predict performance, and optimize distribution strategies
Personalization strategy development
Create tailored messaging and experiences for consumers at scale
A programmatic video is a video ad bought and delivered via software that evaluates each impression in real time. A DSP bids only when the viewer, context, and price match your targeting and KPI rules.
Automated, impression-level purchasing of video ads through a DSP, using data to target audiences, set frequency caps, and optimize bids in real time across exchanges and deals.
Google Display & Video 360 (DV360) is a widely used DSP for planning, targeting, bidding, and measuring programmatic video campaigns.
Online video advertising covers any paid video placement on digital screens—CTV/OTT apps, websites, and mobile apps. It includes pre-, mid-, and post-roll in-stream, outstream units in articles/feeds, social/in-feed video, and interactive/shoppable formats.
The core types are in-stream (pre-, mid-, post-roll), outstream (in-article/in-feed players), native/in-feed, CTV/OTT on the big screen, rewarded video in apps/games, and interactive/shoppable units (overlays, QR, product galleries).
YouTube is a platform, but its inventory can be bought programmatically (e.g., via Google Ads or DV360, including Programmatic Guaranteed and auction buys). It’s one of several programmatic video supply sources alongside CTV apps and publisher video.
Programmatic video is the buying method (automated, data-driven, impression-level). CTV advertising is the channel (video ads delivered on internet-connected TVs and streaming devices). Many CTV ads are bought programmatically, but programmatic video also runs on web and mobile.
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