5 Ways RTB is Changing Digital Advertising Forever

5 Ways RTB is Changing Digital Advertising Forever

  • 14 June 2013

The following post is written by Chitika's Head of Real Time Bidding, Mike Ouellette.

The adoption of real-time bidding as a protocol for buying and selling media has been growing fast since inception and, if you think about it, it was inevitable. Over the years, digital marketers have been pushing for faster access to inventory, at the best rate possible, outside of the boundaries of a specific publisher or ad network and with targeting capabilities so they can reach their specific audience with a message tailored just for them. Even in these early stages, RTB seems to be delivering and, at the same time, changing the digital advertising economy. Here's how:

  1. Unprecedented scale – Marketers can finally leverage the full breadth of available digital inventory instantly. This means access to billions of daily impression opportunities on any ad supported website, mobile website or mobile app.
  2. New levels of precision – Low response rates have plagued display ads for decades. Although RTB does not completely solve this dilemma, it does incrementally improve response rates when the right execution is applied. Marketers can understand interest attributes of a user in milliseconds, which guides buying decisions against the vast daily impression opportunity pool. Marketers pay for the impressions that match the audience they are targeting, and publishers have the opportunity to realize higher than average CPMs on those impressions that are most valuable to the marketers.
  3. The ultimate decision engine – For a variety of good reasons, RTB began in the easiest sector to gain scale and momentum, the agency-driven display marketplace. Although the RTB economy is still dominated by digital display, there are some new models emerging, integrating a wide variety of ad formats into RTB. Everything from search-based text ads to outdoor billboards are being bought and sold via RTB. The combination of a diverse aggregation of ad inventory with deep levels of interest-based data and analytics makes comprehensive RTB technologies the ultimate decision engines for marketers.
  4. The players - Advertising these days is much more science than art than it was ten years ago, and this trend will only continue. One can argue that this started before RTB came onto the scene, but RTB has without a doubt sped up the process. Most firms in the RTB space have a least one data scientist on staff. Ad companies are looking for more mathematics, economics and physics majors coming out of school vs. business, marketing and communications majors. The need to understand and succeed in this highly technical space has changed the required skill set of the typical digital advertising employee.
  5. No more unmonetized inventory – Ad networks had been promising publishers high fill rates on their inventory for years, but for most publishers this was never a reality. Now, publishers participating the in the RTB space have the opportunity to push unsold inventory to the open market, essentially filling all of those unsold impression opportunities. Market rate always varies significantly in the open market based on the multitude of factors including traffic quality, scarcity, viewability, data availability, etc.

Mike Ouellete

Michael Ouellette is the Head of Chitika's Real Time Trading Desk Division, dedicated to helping marketers make the right targeting decisions based on Chitika's vast inventory of consumer intent data. If you are interested in learning more about what Chitika's RTB program can do for your company, click here.