The term RTB stands for Real Time Bidding and has its origins from the fully electronic process through which advertisements are bought and sold in an automated auction on a per impression basis.
As mentioned, this is done through instantaneous and programmed auctions, the style for which closely resembles the operations style of the financial markets. Much like stocks in the financial markets, the buyers of the advertisements needs to bid on available impressions and in case his bid won, the advertisement of the buyer gets displayed on the website of the publisher, instantly. This process allows the advertisers to manage & optimize the advertisements coming from several networks.
Publishers are on the other side of this equation, on their part they plug in platforms like Pubmatic and other Supply Side Platforms to get the highest price possible for inventory they haven’t sold through direct sales efforts.
This process can be differentiated from the process of static auctions on the basis of the per-impression bidding. In the second case, the process involves bulks of several thousand of impressions.
The RTB process from start to finish
Typically, the transaction starts with the visit of a person to the website of the publisher. This visit triggers a request for bidding that might include data and information related to the visitor’s demographical data, his browsing history, his location and the pages that gets loaded. This request moves from the publisher to the ad-exchange, whose task is to submit the data for getting accessed by millions of advertisers who can by default submit their bid proposals to publish their ads. This happens on a real-time basis. While bidding, the advertiser bids on all those impressions that he gets served with. The impression gets passed to the party proposing the highest of the bid and eventually their ads get published. The process gets repeated for each and every slot for the advertisement that may be available on the concerned page. Transactions for RTB happen typically within one hundred milliseconds after the exchange receives the request.
This bidding process happens to be autonomous and it provides the advertisers the maximum of the bids for the ad campaigns. This process ensures that the advertising budget get utilized optimally. For some specific categories of consumers the bidding criteria becomes very complex as it involves the widest scopes of actions that might range between behavioral profiles that might come very detailed to the conversion of those data.
Thus the process requires platforms for the marketers who usually need effective tools for accomplishing in their job accurately. Bidable RTB is one of them that I have found to be a minimum hassle, but many other advertisers use platforms like Appnexus or Turn. From a publisher point of view there are also many platforms available like the Rubicon Project SSP, but there are many others available.