A Plain English Guide to Real Time Bidding
Media PlanningA Plain English Guide to Real Time Bidding
Since its inception in 2009, real-time bidding (RTB) has become one of the most popular ways to purchase ad inventory online.
But even for experienced marketers, this type of programmatic advertising can be a very confusing concept. I, for one, get intimidated just by reading the word "programmatic."
So let's break down what RTB is, how it works, and the pros and cons of using it – all while keeping it jargon-free.
Before we dive into RTB, let's cover a few basics.
An impression, which is when an ad is displayed on a user's screen, is the currency used in RTB. Publishers – i.e., the owners of the webpages and mobile apps on which ads are displayed – typically charge for every 1,000 impressions the ad gets. Advertisers know this as the cost per mille (CPM) and place their bids based on the value of each impression.
How do you determine that value? By evaluating the user against your targeting parameters (more on that later).
Are there real-time bidding platforms?
There are no RTB platforms because real-time bidding is a method of purchasing impressions, not a channel. Still confused? Let's picture a real auction.
Imagine you want to bid on a car. You hire someone to go to the auction for you – that's your demand-side platform (DSP). The person putting the car up for auction is the publisher and the venue is the marketplace. Raising your hand to indicate...
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