RTB as a relatively new method of selling and buying online display advertising in real time, one ad impression at a time. Sounds a little confusing? In absolute layman’s terms, it simply means that it is a platform that allows advertisers to bid for the right to advertise on a given web page that is being opened up at any given time by any given individual.
RTB is the valuation and bidding on individual impressions in real time. The buying takes place over online media exchanges – basically media marketplaces – which connect sellers (publishers) and buyers (advertisers
Basically, it is an individual-targeted module of advertising.
How does it work?
In ancient times (by that I mean, about 5 years ago!), if Mr. A opened a web page, he would be bombarded with advertisements ranging from air tickets to curtain rods. Now Mr. A is neither interested in air tickets nor in curtain rods. So what does he do? He simply ignores those ads and goes about his business. What he is really interested in is real estate, and should an ad pertaining to that pop up, I am sure he will enthusiastically click on the ad link to find out more.
Now-a-days, an individual’s browsing history or tracking cookies is noted to form a picture of the person’s interests. So the next time this person opens a web page, an intense bidding war happens behind the scenes for the advertising space on that particular web page. The highest bidder wins and gets the chance to catch the attention of the unsuspecting browser. Of course all of this happens in absolute nano seconds and this process is repeated for every ad space on every page he/she opens.
How real time bidding works and who is involved ???.
Real-time bidding (real time advertising): a method of buying online display advertising in which publishers release impressions to be purchased individually, in an auction environment.
Ad networks: an entity that connects buyers and sellers of online advertising impressions. These companies can facilitate the purchasing of real time ad inventory.
Demand side platform (dsp): these entities allow advertisers to manage their purchasing of online display advertising in real-time. DSPs purchase advertising for the advertisers through ad networks and exchanges. DSP functionality varies, and includes things like allowing advertisers to manage their bid amounts, performance metrics and consumer targeting.
Online display advertising (online banner ads): online advertising that appears on top of or alongside the content of a webpage. This type of advertising utilizes banners which come in the standard sizes of 300×250, 728×90 and 160×600.
Targeted advertising: a form of advertising in which ads are delivered to consumers based on demographics and geography, as well as other factors like interests and purchasing behaviour. Real time bidding has enabled online display advertising to become more targeted through the use of first and third party data.
Online contextual advertising: online advertising which is selected to appear on a particular webpage because it is a match for the content of the page.
Behavioral marketing (behavioural targeting): this term refers to several ways in which online advertising campaigns are made more effective by taking into consideration the actions of the consumer. Data needs to be collected to facilitate this process, and what is collected will vary based on the desires of the advertisers.
Supply Side Platform (SSP): an entity that works with publishers and advertisers to release impressions into the real time bidding ecosystem to be purchased by DSPs or other agents.
Second Price Auction: an auction format in which the bidder who offers to pay the highest price pays only the price of the second highest bidder. This system is used in most RTB ecosystems.
Cookie Caching: collecting the cookies of visitors to a webpage for the purpose of making more informed buying decisions about that consumer’s impression.
Retargeting: the process of adjusting your online advertising creative, as well as purchasing strategy, based on the actions of consumers. The simplest example is spending more for the impressions of consumers who have not completed an order form on your website, as well as showing them a more influential creative.
Tagging a Page: the process of adding a piece of code (referred to as a ‘pixel’) to a webpage (usually the landing page and key pages for a campaign) which collect data on the visitors to those pages. This data is then used to make more informed buying decisions later on.
Ad Server: a technology used to store online display ads, then subsequently deliver them to a consumer on a website. This company’s purpose is to maximize revenue for the publisher and/or advertiser, as well as manage campaigns.
Brand Safety Technology: this technology is used to classify the content of webpages and to allow advertisers to avoid running their campaigns on pages which carry content they deem to be ‘negative’ for their brand.
Prospecting: the process through which an RTB campaign is implemented so that promising consumers are sought out so that they can be retargeted throughout the campaign.
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