Real Time Bidding Explained – Programmatic Buying

Real Time Bidding Explained - Programmatic Buying


Real Time Bidding (RTB) Explained – Programmatic Buying, Platforms, Ad Networks Guide For 2019

Programmatic is one of the hype terms in marketers’ communities. Traditional networks are not so perfect as the problems of transparency and fraud are still not resolved, however people are used to them. In this article, we are going to discuss what new trend is about and how much RTB advertising is different from the customary one.

Some words about previous technologies

Let’s start with the question of otherness. Traditional networks offer advertisers to publishers their ads on the playgrounds where their target audience is supposed to be. However, people with equal formal characteristics may live in different locations, have different hobbies and marital status – these and a number of other factors may influence on the list of ads that can be interesting for this or that person. Thousands of impressions were paid, and we can say that money was burnt in vain. Marketers were likely to understand the situation, but it was the best possible way out until recently.

New approach peculiarities

People don’t like advertising, but, according to recent studies, it can be more positive about them if something relevant to a particular person. Programmatic ad networks resolve this problem. Necessary information about the user, without exact defining as a person, is collected with the help of cookies to offer different ads for everyone.

Programmatic RTB advertising is one of the most popular variants of implementation. To say it simply, it works like an auction, where RTB is just a technology while there are two mechanisms necessary for its functioning:

Ad Exchange – a market place where Publishers and Advertisers “meet” to consider and trade inventory available.

DSP Platform – this program is necessary for advertisers to obtain impressions.

The idea of programmatic RTB is as follows:

A person is entering a website connected to RTB platform. Advertisers are immediately informed about the impression type: age, location, interests, type of the device, etc. According to the information received, the biddings are held. The winner with the maximum bid is given an opportunity to show its ad. The deal is finished at the moment of the page being loaded, which generally takes mere seconds. The procedure will be repeated with a new visitor.

Human interaction is absolutely impossible due to speed and information scope. One of the biggest advantages, in this case, is that cheating is hardly possible, special programs and algorithms are implemented.

The same as traditional networks offer their advertising services, there are also programmatic RTB networks. Companies of any size can join them to participate in advertising. Websites with an audience of 500 – 600 unique users can start here. Not all old-school networks are ready to consider such resources, while the programmatic focus on the quality impression first of all.

There is also programmatic direct. It is generally applied when a brand owner needs ads posting for a particular timespan or just for some amount of ads. In either case, just the programmatic ecosystem is used, while a choice of impressions is based on the principle above.

Why programmatic is competing with the advertising world?

First of all, we get a high level of personalization. Higher CTR level causes more sales and, obviously, happy marketers and brand owners.

Additionally, programmatic excludes the work of third parties that leads to lower cost of advertising for Advertisers and higher incomes for Publishers.

Transparency. It becomes almost impossible to launch fraud activities as everything is quite easy to track.

Future of programmatic

In 2017 OpenRTB 3.0 was released with the focus of security and transparency improvements. Corrections to a current version were also made as well to provide a better experience for all business participants. Another trick is that RTB platforms are also improved and one of their enhances is that they acquire some features of the ancestors. We are very likely to see great fusion very soon, but you’d better join the programmatic network as quickly as possible before your competitors haven’t done it.

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