Five Things You Should Know About RTB

1994:  the year I sent my first email, the year Yahoo  was created, the year Al Gore coined the term ‘information superhighway’ and believe it not the year of the first online banner ad.

targeted digital marketing

This is not a history lesson, but rather five things you should know about the ever evolving real-time display landscape that has come a long way since that first banner ad back in ’94.

  1. How does real time bidding (RTB) work?

By now we should all know what the acronym RTB stands for, but do we really know how it works?

When a user visits a website with a display ad, a call is made by the exchange servers supporting RTB to check with the DSP (Demand Side Platform) to determine which marketer gets to serve the ad. There is a list of attributes associated with each user and the platform checks if this user has the desired attributes the marketer wants to target. Based on the perceived value of this user to the marketer, the marketer places a bid on this ad placement and the highest bidding marketer gets the spot.

  1. How does a DSP decide which campaign to serve the impression for?

The real time bidder, which is fundamentally the brain in the process, defines the bidding strategy. This means it will be decided whether or not a bid will be placed for the displayed impression. If you decide to place, a bid you need to think about which campaign is the most suited, and based on the projected performance and estimated market value, what the best price is for it.

  1. What’s the difference between an ad-exchange and anad-network?

An exchange is an auction marketplace that facilitates the buying and selling of inventory across multiple ad networks and DSPs against the network which buys inventory, and adds value in the form of technology, optimisation and data.

  1. What’s the difference between third party  and first  party data?

1st party: Any data proprietary to a marketer, such as search queries, site visitor data, CRM data that comes from marketer’s website and analytics, CRM database or any other source of proprietary customer data.

3rd party: Any data that a marketer can purchase in order to better identify and target their audiences. This includes demographic or psychographic data, past purchase history and more that can be found in data exchanges or individual 3rd party data providers.

  1. Why use real time bidding (RTB)?

RTB allows brands to bid for individual impressions in real time, capitalising on benefits which include audience targeting, global frequency caps, centralised analytics and guaranteed delivery and quality remnant inventory at a fraction of the price.

 

 

Luckily we’ve come a long way since the first banner ad, a part of AT&T’s “You Will” campaign in 1994.

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