What is Real-Time Bidding?
Real-time bidding (RTB) is part of the new, currently trending programmatic advertising of the digital marketing industry. This concept covers the auction setting that allows the buying and selling of ads, and this takes place in a short span of seconds in ad networks. When an advertiser wins the auction, their digital ad is shown on the publisher’s property or a web page on mobile or desktop. Other platforms such as supply-side platforms and ad exchanges come into play here too. RTB auctions are based on impressions, and static auctions only allow package deals on impressions.
How Does It Work?
When you visit one website, the Ad exchange receives a matching bid request. This request contains information such as location, browser history, and demographic data. This information is then passed on to advertisers and buyers who bid in real-time. The impressions are presented to users. The highest-bidding advertisers win the impression, and their ad is displayed to the site visitor. The process is repetitive and goes this way for each ad unit of the site. While the process may seem a little complex, it only takes 100 milliseconds, making it an efficient ecosystem for digital advertising.
Difference Between (RTB) Real-Time Bidding and Programmatic Advertising
Programmatic advertising can be considered an umbrella term for the process where ads are bought and sold, while RTB is just a type or part of the process. Some publishers sell an entire inventory via programmatic direct.
An ad exchange (provided by Google) and RTB advertising are also not similar. It is also part of programmatic advertisement and plays a role in real-time bidding. Ad exchanges are the platforms that allow the trading of ad inventory by publishers and advertisers. Advertisers bid via the demand-side platform, and the highest bidder gets the ad delivered to the website in the right ad formats.
Demand-side platforms are essential components of real-time bidding. They let the advertiser gain access to real-time bidding exchanges easily and efficiently. DSPs depend on audience data to buy ad impressions, while the bidding technology bids based on the audience.
Benefits of RTB for Advertisers
- More specific media purchase. The ad buying encouraged here is highly specific and is targeting specific audiences, which means the advertisers do not need to buy bulk inventory and waste resources on irrelevant websites. They only purchase what they use.
- In-depth knowledge. The in-depth knowledge provided by the RTB experience can be translated into marketing strategy improvement. This type of bidding can help advertisers get to learn and understand their target audience, making it easy to create a strategic approach with the data from ad impression.
- Better-performance in campaigns. The platform provides a single platform that helps advertisers get to view and manage an online campaign.
Benefits of RTB for Publishers
- Accurate pricing. Since the pricing is driven by technology, the publisher receives value. Only the best bid price delivers the impression. A supply side platform needs to be put into use if the publisher hopes to utilize RTB.
- Value increase of remnant inventories. Publishers aim to monetize their inventories. RTB allows previously non-monetized inventory to be utilized through advertisers based on audiences.
- More direct sales. Selling inventory to advertisers through RTB allows publishers to understand their most-profitable inventory parts. This information can be used in the sale of inventories to interested parties directly.
As long as you are a user of RTB, you will benefit. A user can either be a publisher or advertiser using SSP, and DSP.