What is Real-Time Bidding?

Real-time bidding is a form of programmatic advertising. It describes an automated auction that takes place to determine which ads are shown in predefined placements.

Advertisers can place their maximum bids and define their target audience and campaign goals. Publishers can offer their ad spots and set requirements such as minimum bids or traffic limitations. An algorithm then proceeds the auction to find the best matching offer for each ad placement. This auction happens in real-time within milliseconds when a user launches an app or opens a website. When the app’s or website’s content is completely loaded, the auction is already over, and the winning advertiser’s ad shows up.

RTB works based on three components:

• a demand side platform (DSP) to bundle advertisers’ campaigns
• a supply side platform (SSP to aggregate publishers’ ad placements
• an ad exchange to connect the DSP and the SSP and run the auction