Business

Real-Time Bidding Model for CTV Advertisers: Explained

Despite the pandemic crisis has brought turbulence into businesses all around the world, marketers still intend to allocate huge budgets on digital advertising, and the overall ad spend figure is estimated to reach $332.84 billion for 2020, according to eMarketer forecast.

Since real-time bidding advertising (RTB) has emerged on the radar of the ad tech industry, it has become an integral part of digital advertising, digital television advertising. It’s not a surprise that brands prefer RTB for ad buying: it provides them with hundredfold outputs.

There is an adage that says: “Easy Reading is Damn Hard Writing”, and this is the truth of RTB as well. It gives ad tech players easy and efficient solutions on running ad campaigns, but behind the ease, there are sophisticated algorithms and calculations and it took years for software engineers to create them.

So, let’s shed some light on what real-time bidding advertising is, how it fits the CTV dimension, and how brands can benefit from it.

RTB = Programmatic. Programmatic ≠ RTB

First things first, a very common confusion in the topic of automated online advertising arises in regard to understanding the difference between programmatic technology and RTB.

Programmatic is defined as technology that allows ad players to buy and sell inventory automatically. It’s kind of umbrella technology that covers guaranteed direct buying, private exchange buying, preferred deals, and real-time bidding.

So, RTB is one of the models that uses this technology to provide advertisers and agencies with the option to bid on desirable impressions via ad exchange and connects them to relevant publishers.

As a simple analogy: every piano is a musical instrument, but not every musical instrument is a piano. Same here, every RTB is programmatic-based, but it’s not vice versa.

Structure of Real-Time Bidding Concept

Just like any complicated structure, RTB has various components it consists of. Here is the blueprint:

  • Demand-side platform (DSP): a service that advertisers and agencies use to buy desirable ad spots. It’s a software gateway between brands and ad exchange;
  • Supply-side platform (SSP): is also a gateway, but here it connects publishers with list of bids from DSPs via ad exchange;
  • Ad exchanges: intermediary platforms where demand and supply sides are able to interact with each other;
  • Ad networks: network providers that allow publishers to sell an ad to numerous connected platforms;
  • Data management platform (DMP): it’s a platform that enables data collecting and its management. DMP allows brands to identify unique, relevant audience segments;
  • Trading desk: a platform to configure the parameters of ad buying
  • Dynamic creative optimization platform (DCOP): a platform that assists in creatives optimization. DCOP for CTV allows brands to optimize messages and creatives according to demographics, interests, location, time, seasons, holidays, weather, language and etc., generating relevant, data-driven video ads in real-time mode;
  • Ad verification and brand protection: a system that validates ads and shields brands against improper impressions;
  • Analytics: metric tools that are tracking user behavior

As we can see, RTB involves all the players necessary for performing online advertising on an automated basis, so advertisers don’t even have to work with publishers directly. However, many brands still prefer PMP deals when advertising on digital TV as it provides access to premium inventory.

RTB for CTV

Initially, real-time bidding technology was developed for display advertising(when browsing via desktop or mobile) but it completely fits the CTV dimension. So all the benefits of the model are retranslated on this advertising channel too. Inventory here can be purchased on a per-impression basis.

Advertisers can use a standard trade desk software to manage their campaigns and just select the desirable channel which is CTV in this case. They can configure parameters of video creatives that can include QR codes and other interactive options and formats like tremor video ads (for mobile users who consume TV content via OTT) that allow marketers to win audiences’ attention.

Wrapping Up

The RTB model is a milestone in the ad tech industry since it was released in 2008. For over a decade this technology expanded greatly and took over multiple platforms, and connected television is also on the list. It helps brands to purchase desirable ad spots and reach cord-cutters who are intensively shifting from cable TV to the digital one. This is an efficient way to extend classical online advertising and improve the marketing advantage of a brand by engaging more users with interactive creatives available on the CTV channel.

I am content write and technical expert at a tech organization. I also do the computer science education through the college. Love to solve the techncal issue through my writing and want to help people to solve their.

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