To envision the process, keep this flow in mind
- The user enters a website, then an ad request is sent to the ad exchange platform with all the information about the user and the website itself.
- This information is matched and checked with all available demand partners or advertisers and a real-time auction starts between all the relevant advertisers.
For example, did you ever notice that after you’ve visited a certain website, suddenly any visit you make to any other site start showing you dog food ads? That’s called remarketing and it is also based upon programmatic advertising technology which facilitates Real-Time Bidding.
In the time that it takes to load the website, roughly 100ms, an auction takes place between that dog food brand advertiser and any other advertiser looking to show you ads as a user. If the dog food brand advertiser knows you have the intent to buy dog food, he might bid more than other programmatic advertisers.
Whoever bids the most will win the impression and get to show you, the user, an ad.
In the past, advertisers would seek relevant sites, in our case, for example, blogs about dogs or dog nutrition sites, it is likely that users who end up on these sites own a few relevant traits you’d like to capitalize on as brand advertisers. In these cases, advertisers would manually negotiate and upload their banner ads campaigns to these sites in order to get the relevant audience to their products and services.
Real-time bidding allows a more granular media buy process, ads can be bought and sold on a per case basis, which means that out of all the users of a certain website, you can opt-in to display ads only to the users who visited your website instead of all the users as a whole. That allows advertisers to increase their bid, or to become more competitive when buying relevant users in a programmatic auction through openRTB.