Real time bidding operates through a popular programmatic advertising model called cost per mille, or CPM. Certain types of programmatic ads are measured by cost per mille (CPM), which means cost per thousand impressions.
Most importantly, SSPs enable publishers to simultaneously offer ads on their webpages to many different ad exchanges and ad networks.
Real-time bidding differs from static auctions where advertisers can only bid for several thousand impressions in single package deals. This makes static auctions less efficient than RTB for advertisers as well as publishers.
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Cost-effective for advertisers: When advertisers save money, publishers benefit too. Brands that feel they’re choosing the more cost-effective solution will be more likely to put their trust in publishers using RTB, resulting in less unused ad inventory and increased ad revenue.
Real-time bidding has become one of the main parts of modern online advertising, surpassing previous, less efficient ways of connecting online publishers and the advertisers.
Increasing ROI: When using a DSP to access ad exchanges, advertisers can adjust their settings to home in on the most relevant inventory for them, cutting down on wasted ad impressions and maximizing conversions.
Brand safety has become an important concern for advertisers in recent years and some participants offer advertisers better brand safety through RTB by using technologies which prevent their advertising content being shown on unsuitable websites or next to inappropriate content.
Payment Processed: The advertiser pays the agreed bid price through the DSP. The SSP then collects the payment, deducts its fee, and remits the remainder to the publisher.
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Publisher Uses SSP: A publisher integrates their website or digital platform with a supply-side platform (SSP) to manage and offer their ad inventory to potential buyers in real-time.
Standing apart from other CTV platforms, Performance TV doesn’t co-mingle inventory with traditional video inventory to garner more impressions for advertisers or drive down costs. If you pay for TV inventory, you get TV inventory.
In RTB programmatic, the RTB auction is the core process. It ensures that the highest bidder wins an ad impression on the publisher’s media. It's also called an open auction since any publisher and advertiser can participate in it. The platform that hosts open auctions is called RTB exchange or ad exchange. It communicates with supply-side platforms (SSPs) — software used by publishers, and demand-side platforms (DSPs) — software used by advertisers. From SSPs, ad exchanges collect data about impressions available for sale in the form of bid requests. From DSPs they solicit bid responses showing how much companies are willing to pay for their banner or video to appear on the suggested ad space.
Publishers worry that RTB will enable brands to pay them less for their inventory. However, by selling their impressions to the most relevant and motivated advertisers, the RTB auction helps publishers earn the highest price per impression. With real-time bidding, publishers monetize their media better because they can: Virtually trade with unlimited advertisers to minimize unsold inventory.