Understanding the Mechanics of Real-Time Bidding (RTB)
Everyone has seen that the global digital advertising market has been subject to extensive changes over the past few years. The switch from customary media buying to highly automated and data-driven approaches has further distinguished this remarkable transformation. And you know what has now emerged as a central component of this development? Real-time bidding, or, you know, just RTB. This technology-driven solution has changed the fundamentals of the ad sector, empowering advertisers to bid on ad impressions in real time. All in all, RTBs have facilitated the development of a dynamic marketplace for digital ad inventory. This approach has replaced traditional, manual methods, ultimately allowing for higher ad revenue for publishers.
An RTB platform, in the most basic terms, is an auction system that is driven by an intricate network of technology platforms. All stakeholders in the process, such as advertisers and other relevant intermediaries, can interact with each other through an RTB platform. To what end, though? To buy and sell ad impressions, naturally. It must also be noted that such a data-driven process helps advertisers to make informed decisions about ad placement while also empowering publishers to optimize their ad inventory.
To offer you a clearer picture of these platforms, we will now take a closer look at how RTB platforms function.
What is Referred to an RTB Platform?
It is a technology designed to make buying and selling digital ad impressions in real-time auctions easier. To give you a basic idea of this novel technology solution, here is an overview of what goes on in an RTB platform. It starts when a client visits a site or application — at this point, a small piece of code, called an ad tag, “speaks” with the RTB platform. The platform, in turn, collects applicable data about the client and the available ad space, thus building an ad impression.
Several advertisers bid on this impression simultaneously through their demand-side platforms (DSPs), with the highest bidder obviously winning the auction. Simply put, RTB platforms are basically intermediaries that help connect advertisers and publishers. Why? Well, to help ensure a smooth auction process, obviously.
How Do RTB Platforms Work Exactly?
● Availability of ad impression: The process starts with a user visiting a website or app. When that happens, the publisher sends out a request to its ad server. It then sees if an ad space, also referred to as an ad impression, is available.
● Ad exchange integration: After the ad impressions’ availability is established, the ad server sends information about the ad impression to an ad exchange. The details include ad format, user information, etc,.
● Bid request: The ad exchange sends out details about the ad impression to different DSPs.
● Advertisers bid: Each DSP calculates a bid based on the advertiser’s targeting criteria and budget and sends it back to the ad exchange.
● Auction: The ad exchange receives bids and identifies the highest bidder in real time. This bidder, of course, wins the auction.
● Ad serving: The ad exchange signals to the winning DSP, which, in turn, sends the ad creative to the publisher’s ad server. Finally, the ad is displayed on the website or app.
Can you imagine that all of this happens in a matter of milliseconds? Quite neat, is it not? And to think of all the benefits you stand to gain from such a platform. Now that you know how these platforms work, it is time to start looking for an experienced RTB ad exchange platform development vendor.
