RTB - Real Time Bidding. Usually when you buy a media on CPM basis, 70% of impressions your campaign gets are inefficient. But you still pay a fixed price for 100% of these impressions, even if you need only 20% which actually got you a conversion. Here's where RTB comes in: Instead of paying a fixed price for all impressions you can place a bid only on impressions that you think that will be efficient for your product. How do you know if it's efficient? There's the DSP- Demand Side Platform. This platform allows you to get all necessary information regarding impressions you about to get. Baised on this information you can increase or decrease a bid. This is what I understand from some articles that I found. But I still can't understand how does it work in real life. Who and how place a bid? How does all process go? Please share your experience with RTB?
I just did some research and found this: OK. So how does it work? As an ad impression loads in a user’s Web browser, information about the page it is on and the user viewing it is passed to an ad exchange, which auctions it off to the advertiser willing to pay the highest price for it. The winning bidder’s ad is then loaded into the webpage nearly instantly; the whole process takes just milliseconds to complete. Advertisers typically usedemand-side platforms to help them decide which ad impressions to purchase and how much to bid on them based on a variety of factors, such as the sites they appear on and the previous behavior of the users loading them. Zappos might recognize that a user has previously been on its site looking at a specific pair of shoes, for example, and therefore may be prepared to pay more than Amazon or Best Buy to serve ads to him. The price of impressions is determined in real time based on what buyers are willing to pay, hence the name “real-time bidding.” Why is real-time bidding good for advertisers? Efficiency. Thanks to real-time bidding, ad buyers no longer need to work directly with publishers or ad networks to negotiate ad prices and to traffic ads. Using exchanges and other ad tech, they can access a huge range of inventory across a wide range of sites and cherry-pick only the impressions they deem most valuable to them. That cuts down the number of impressions wasted on the wrong users but also minimizes the need for costly and unreliable human ad buyers. I’ve heard RTB is screwing publishers. Is that true? Some major publishers are wary of RTB because they feel it enables advertisers to pay them less for their inventory. Increasingly, however, they’re becoming more comfortable with it as exchanges and supply-side platforms enable them to control the minimum prices at which their inventory is sold, often called price floors. This enables publishers to open their ads up to an auction, but to set a reserve price that must be met in order for a transaction to take place. I hope this is helpful, Darius Vaduva