A super accessible beginner’s guide to programmatic buying and RTB

A super accessible beginner’s guide to programmatic buying and RTB

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Programmatic approach has become popular quite long ago. But the buzz around is still very loud. It seemed to be enough time to study a new trend deeply and see how useful it is, however there are generally two opinions about this. Some marketers have welcomed it, while others see it as something hardly deserving respect.

We hope that you don’t panic as we are going to clarify what programmatic is about, how it relates to RTB and what are the differences from traditional advertising platforms.

Programmatic buying

There is no special secret, in fact it means automated. When marketers tell you about programmatic buying they imply that the inventory was bought automatically from the webpage or there was a price stated for it, or direct purchase that means that this ad space will definitely belong to you.

Programmatic RTB (Real Time Bidding)

These both terms often go together, so that a lot of people refer them as just one thing. However, RTB is a form of realization. Its main sense is in an open auctions where advertisers bid for each separate impression.

For example

When a visitor drops into a website plugged to RTB systems, all advertisers are immediately informed about it. They have a set of information about this user: his gender, approximate age, which device he uses for surfing, location he is likely to be and some other things. All the information is anonymous and can’t show directly on a particular man or woman, but it is enough for advertisers to make a decision how important this user is. They bid and a winner with an offer of the highest price shows the ad to that visitor. The process is not just quick, it is faster than a cheetah, as all backstage happens at the moment of page loading and is finished when the user sees the ad. The procedure will be repeated with every new visitor.

Human interaction is excluded here and the tons of information are successfully operated with the help of complex algorithms, machine learning and artificial intelligence.

Mind that there can be private auctions too. It is the case when a huge publisher is selling its premium inventory and is obviously interested in high prices. The rules of acceptance for advertisers are very strict here and only publishers can decide who is to be invited or rejected.

Main benefit of the approach is to make ads personalized. Each user sees the ads that suit their online behaviour, for example, previously visited pages. People don’t like ads, but they feel more loyal when the offers they see are in balance with their interests and, thus, click the ads more often. Clients feel less frustrated about the ads they see and companies can sell a really useful thing and, probably, get one more regular customer in the future.

What is the future of traditional ad networks?

It is a common case when a new trend is coming, the previous one is vanishing. Luckily, all the rules have exceptions. Ad networks started implementing programmatic approach in their work, even cases of RTB using is not a rare thing now. Representatives of another idea have also found out they have what to take from their predecessors. The most possible variant is that fusion and appearing of something new at all seems to be the likeliest.

Adopting new things immediately may be even not wise at all, but Internet and all related mechanism are certainly not to remain solid and stable. Leaving old working technologies may be painful, but it will be even more difficult to realize how far you are from the competitors who have tried.

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