Programmatic advertising is swiftly taking over the digital marketing space. According to data by Statista, the share of programmatic advertising in 2021 was $418 billion and is expected to reach $725 billion by 2026. To understand how it works, read our guide on programmatic advertising before proceeding with this article.
Real-time bidding (RTB) is one of the most popular advertising methods. The number of businesses going for it is increasing yearly with a CAGR of 32%. And if this is the first time you hear about it, we are ready to provide you with a detailed guide.
Here you will learn the answers to the following questions: “What does RTB stand for?” and “How can I use it to maximize ROI?”
What is real-time bidding (RTB)?
Real-time bidding is a process for buying online advertising inventory. It allows media buyers to to programmatically bid for ad placements on publishers’ websites in real time, as opposed to buying them in bulk via traditional methods.
RTB is performed through an automated auction-based system, where buyers and sellers of ad space are connected in an open marketplace. The winner of the auction gets the ad space. The process occurs almost instantaneously in real time and is fully automated.
Adsterra partners with reliable SSP and DSP providers, serving premium, non-remnant traffic and thoroughly selected ads
Programmatic advertising vs. real-time bidding
Knowing what RTB is about includes understanding how it is different from programmatic advertising. Programmatic uses both auction-based and non-auction models while RTB is only about auctions.
RTB is designed for selling and buying top traffic and ad spaces. However, the algorithm is being criticized for operating poor-quality assets, as well. The use of this tool is under the responsibility of its providers.
Earlier, we shared guides to choosing the best DSP platform and selling premium traffic:
- Best DSP Platforms in 2023: Which One to Choose to Sell Your Traffic?
- Adsterra RTB: We’re Looking For Premium SSP Traffic Partners
What is real-time bidding in marketing?
RTB is the driving factor behind the majority of ad campaigns. Through it, advertisers can buy ad inventory, place their ads, and get results instantly.
RTB works on the basis of bidding per ad space. The entire process of auctioning occurs in milliseconds when the webpage is loading. The advertisers can set predefined conditions like target audience, demography, purchase intentions, etc. before the auction starts. Once the bidding is finished, the ads are displayed as soon as the webpage loads.
There are multiple stakeholders in the auctions each representing different sides which are connected programmatically:
To Contents ↑Demand side
A demand side platform (DSP) facilitates buying ad space. From the advertiser’s side, this is a typical platform for buying traffic. The advertiser uploads advertising materials (link to the landing page, creative) and sets the targeting (GEO, browsers, languages, devices, OS, etc.). Thus, a huge number of different advertising campaigns for different advertising formats and targets are consolidated within one system. Such a platform can also buy traffic directly from webmasters
To participate in the real-time bidding process, advertisers need to sign up with a demand-side platform and pay a small fee to fund their accounts. DSPs facilitate the bidding process for the advertisers by providing them with flexible pricing of advertising space and setting up RTB campaigns.
To Contents ↑Ad Exchange
An Ad Exchange is a platform where publishers and advertisers buy and sell ad space respectively in real time. The majority of the ad slots sold here are in the form of display, video, or mobile ads.
SSPs put the ad slots from their publishers on Ad Exchanges. Hence, an Ad Exchange is the biggest pool of ad slots to choose from. An advertiser gets a specific ad slot taking into account individual factors like user behavior, location, time of day, etc.
How does real-time bidding work?
The RTB process involves publishers, advertisers, SSPs, and DSPs working simultaneously to complete the auction within milliseconds. To better understand what RTB is let us look at how it occurs:
- When any user clicks on a page in their browser, the ad slots on that page start loading. During this time, the publisher sends the available slots to the SSPs.
- The Information about the ad slot, the user, and what page they are on is sent to an exchange. The user’s previous behavior, time of day, type of device, etc., are the factors that decide the price of the slot being auctioned.
- The SSPs have a look at the data like demographic, location, etc., through website cookies and determine what ads might be relevant.
- DSPs help advertisers decide which ad slots to bid for, how much to bid, etc.
- SSPs have a look at the bids on the exchange and choose the winner based on their relevance with regards to the bid size, content, and the bid amount.
- The auction is completed, and the ad is displayed on the web page instantly.
- The entire process occurs while the webpage is loading.
Selling traffic to reliable DSP platforms
DSP platforms are a great way for publishers to monetize ad space. If you are a publisher with a lot of traffic, then you can earn handsomely using a reliable and safe DSP.
A DSP serves two main purposes, namely:
- Providing advertisers with tools to purchase the right ad space in bulk, followed by targeting, ad management, and tracking facilities.
- Get a large number of relevant ad space from SSPs.
If you are a publisher with consistent traffic and want to find the best DSP to sell your ad space, there are a few factors you should consider:
To Contents ↑1. DSP has partnerships with direct advertisers
A good criterion to evaluate a DSP is the number of direct advertisers it has partnerships with and if the partnerships are short or long-term.
2. DSP is owned by credible providers
When looking to sell your ad space, pay attention to the DSP owners’ reliability and brand name.
3. Smart traffic selection with multiple targeting options
The better the relevance of the ads to your website’s audience, the more you earn. A good DSP platform should be able to deliver ads that are related to the type of content on your website.
4. Anti-fraud systems
A DSP should not accept any website that looks as if it is full of bots and fake views. The website’s traffic should be genuine and of high quality.
5. Transparent payments and dispute resolutions
Another sign of a trustworthy DSP is a swift, smooth, and reliable payment mechanism. On top of that, the assistance they provide in the case of any disputes related to payments or impressions, etc. is a good benchmark.
The Adsterra ad network is a reliable DSP. The Adsterra RTB Platform buys ad impressions automatically in real-time auctions and accepts traffic from SSPs through endpoints.
Adsterra is ready to provide every SSP platform with high payout for any Tier of traffic with more than 1 million daily impressions.
To Contents ↑How much does real-time bidding cost?
The cost of real-time bidding can vary greatly depending on the type of ad space you’re planning to buy. Generally, you can expect to pay anywhere from a few cents to several dollars per impression (CPM) or per click (CPC). The cost of RTB marketing can vary according to various factors, such as:
- Keywords in the ad,
- Target audience demographic,
- Location of the audience,
- Interests of the user,
- Scale of the ad,
- Websites the ad will be displayed on, etc.
Benefits of real-time bidding for advertisers
Now that you know what an RTB is and how it works, let us have a look at some of its advantages.
Optimize traffic buying
Through RTB, advertisers can buy targeted ad slots in large volumes from literally myriads of traffic sources, and this makes their ads more effective. It also saves money and time that advertisers would otherwise spend extensively testing ad campaigns on each separate ad platform.
Most advertisers run RON (run of network) campaigns to test each traffic source. But with real-time bidding, the entire traffic from the network can be tested in a cost-effective manner. Advertisers can buy targeted ad slots through auctions and make their ad campaigns more successful.
To Contents ↑Get access to premium ads
RTB gives you access to high-quality and premium ads that are relevant to your niche.
Optimize the ad expense
Advertisers can bid according to their budget and allocate it in a more transparent way.. You can start using RTB for launching ad campaigns with a limited budget, but since there are lots of competitors for the same traffic, you will need to get ready for increasing your bids.
Time-saving
Since the entire process is automated, once you’ve set your parameters up, all the rest is taken care of.
Multi-device compatibility
It is compatible with various kinds of devices such as desktops, mobiles, tablets, etc.
Track and optimize campaign
RTB gives the advertisers an opportunity to analyze the effectiveness of their purchased ad impressions. This data can be used to optimize ad campaigns.
Disadvantages of real-time bidding
Risks of remnant and low-quality traffic
There are still many platforms that buy and sell billions of useless ad impressions. They were either unsold earlier for some reasons or not checked for bots. That’s why your RTB platform’s reputation means so much.
Lack of focus
Massive traffic is nice, but with RTB you hardly can granularly monitor every single tweak of ad campaign settings. It’s rather a story for those who need to automate marketing at a global scope. We can’t call it a drawback, but a point to consider.
Conclusion
The number of internet users is increasing, and the process of targeting their interests and data collection is becoming more streamlined. Against this backdrop, RTB advertising is going to gain more popularity as it is less time-consuming and more targeted in its ad placement than simply buying ad space.
Moreover, its affordable cost of entry and automation make it a very lucrative system for advertisers. With Adsterra, you can gain access to millions of high-quality and premium ad slots in just a few steps. Please fill in this questionnaire if you need to buy premium traffic, or this one if you want to sell traffic in large amounts. Or, use the buttons below to advertise and monetize non-programmatically.
