Since The Weather Channel launched the industry’s first private ad exchange through Admeld in November of last year, these new platforms have been a hot discussion point on the industry’s blogs, at its conferences, and in its board rooms. Given the pace this industry moves, it’s understandable why many publishers are still exploring what private exchanges are, what they’re capable of, and what they mean for the future of selling media. Hopefully the below glossary will help clarify some of these questions, or at least move the conversation forward.

Private Exchange
A private exchange is an exclusive ad marketplace that gives premium publishers complete control over how they sell their inventory. In contrast with the direct ad network relationships of the past, private exchange publishers have full transparency into the buyers and advertisers, and can restrict access to each impression. Typically, buyers on private exchanges leverage programmatic means such as Real Time Bidding (RTB).

Price Floor
Most private exchanges enable publishers to set price floors, or minimum prices, for buyers to purchase specific portions of their inventory and audience. Because Admeld enables publishers to set floors against specific DSPs, advertisers, agencies, and dozens of other criteria, they are particularly powerful tools in eliminating channel conflict.

Prioritized Bidding
Just one term for what the industry is calling “guaranteed RTB” or “private ad slots”. Prioritized bidding is a technology that enables publishers to grant preferred access to specific buyers under specific circumstances.

Using prioritized bidding, publishers are able to give select buyers “first look” on certain inventory slices and/or audiences in return for a specified price point and/or a significant level of spend. Publishers are allowed to set buyers on the same priority to compete for this specialized inventory, thus “first look” is not limited to one buyer. Certain publishers only offer full transparency or more granular audience targeting within their first look capabilities.

Direct Market
A direct market provides the ability to buy inventory futures, i.e. a “direct deal” sourced by a publisher’s sales force. In the past, this was how most inventory was sold; today, this is largely limited to premium content. In a direct market, private exchanges have an impact by allowing more inventory to be made available through RTB among select advertisers.

Commit
The allocation of advertising dollars to a particular publisher or group of publishers by an agency trading desk (ATD) or advertiser. Typically, the commitment is defined by a specified duration, audience, action or inventory slice.