A Private Marketplace, or PMP, is a type of advertising exchange that is invitation-only. In a PMP, publishers offer their inventory to a select group of buyers, typically using programmatic advertising technology. Compared to open ad exchanges, PMPs offer more control and transparency to both publishers and buyers.

While a PMP is a subset of real-time bidding (RTB), it falls somewhere between programmatic and open auctions. In a PMP, intermediaries are removed from programmatic advertising, reducing the open-ended nature of open auctions by limiting the number of participants. PMPs are typically provided by large, high-quality sites such as The New York Times or The Wall Street Journal, and they show where ad spaces are available and what inventory is available. Only advertisers who have been invited with a Deal ID can access and participate in the PMP auction.

There are several benefits of using a PMP. First, PMPs offer a more secure solution compared to open exchanges, reducing the possibility of fraud. Additionally, PMPs give advertisers and publishers more control over campaign placement, reducing the possibility of insensitive or awkward pairings. PMPs can also be more efficient for advertisers when buying ads on top-tier websites, potentially replacing costly in-house direct-sales teams. Furthermore, PMPs have the potential to expand beyond premium inventory and ads to include mid-tier publishers and advertisers.

PMPs improve brand management by enabling brands to control and protect their reputations through more meaningful ad placements. This coordination between advertisers and publishers helps avoid poor ad placement. These advantages have contributed to the growing popularity of PMPs in recent years.

While PMPs offer many benefits, there are also drawbacks to consider. In some cases, an open exchange may provide a higher yield compared to a PMP, making it a better solution. PMPs can also be more expensive and may not ensure a captive audience. Advertisers who are testing campaigns or ramping up their strategy may not be ready to pay for prime ad spots. Additionally, advertisers may choose to wait and bid in an RTB auction for a lower price instead of securing a first placement in a PMP. Finally, PMPs require more manual interaction and time compared to open exchanges.