What Does RTB Stand For?
RTB stands for real-time bidding, it is has become a popular method that advertisers use to place ads online.
However, you may come across the RTB meaning for the military, which is “Return to Base.” But if you’re looking to learn about RTB advertising, you should know that it’s all about real-time bidding.
What Is RTB?
RTB advertising places ads on digital content as a visitor views the content. For example, when someone clicks on a YouTube video, the ad space for that viewer will go up for auction.
Different companies can bid for the ad space in real-time, and the winner will get the spot.
How Does RTB Work?
Whenever someone clicks on a page that uses an RTB ad, an auction will occur for the ad space. Companies compete to offer the highest bid for the space, and the winner will have their ad show up.
The process can work on videos, blog posts, and other content online. While some publishers may choose to determine the ads before they show, RTB advertising gives multiple companies the chance to compete.
It can help newer companies break into advertising since you don’t have to worry about a page selecting your ad. You should have an ad ready before the auction begins, and you can set a budget that you’re comfortable spending.
Then, you can place your ads into auctions so that you can reach potential customers. When done right, RTB advertising can be very effective.
Is It the Same as Programmatic Advertising?
RTB advertising is similar to programmatic advertising, but there are some essential differences. For one, RTB works in real-time as a viewer clicks on a webpage.
However, programmatic advertising uses various algorithms to determine where to place certain ads. In some cases, RTB ads fall under the umbrella of programmatic ads because you can use an algorithm to decide which content to bid for.
For the most part, programmatic advertising plans out the ads and content ahead of time. On the other hand, real-time bidding occurs in less than a second.
You can plan your ad before the auction, but you won’t always know what content it will appear on. Both types of ads can be useful, but it’s essential to understand the differences so that you can choose which is better for a specific ad campaign.
History of RTB Advertising
RTB advertising has been around for over a decade, and it started gaining popularity around 2010. The new method changed how marketers created campaigns, and there have been some fantastic results.
While RTB advertising hasn’t been around as long as other ad types, it still has a relatively long history. If you’re considering using real-time bidding to get your business out there, consider where it was a while back and how far it has come today.
In the mid-2000s, advertisers started using real-time bidding, and new platforms developed ad exchanges. The ad exchange is where multiple ad networks come together to manage the supply and demand of ads.
Website owners could sell generic ad space to the ad networks, and the networks would offer them on the ad exchange. Companies with ads could select which sites they wanted to bid for.
However, companies could use the information of an individual user to know when to bid. Thanks to the rise of cookies, companies could track customer information and use it to target their advertising.
It seemed like a revolution, and it quickly surpassed the New York Stock Exchange in the number of daily transactions.
RTB advertising has come a long way since the early days. Advertisers can better target customers, not only based on their online activity but also on their demographics.
Because of this, companies can advertise for people who might be interested in buying, but the customer doesn’t have to know about the company.
If a company targets the ad correctly, it won’t have to worry about making a good first impression. For example, a cosmetics company can target young women who watch makeup tutorials on YouTube.
Odds are at least some of the people who view the ad will click and buy something.
In the future, RTB advertising will continue to grow and change. However, it is already a useful tool for online marketing.
Why Use Real-Time Bidding?
You may know the answer to the question, what is RTB? But that doesn’t exactly cover if it’s the right advertising method for you.
For some businesses, an RTB ad can be the best way to attract new customers. You can target users based on their internet history and interests.
But for other businesses, it may be hard to win a lot of ad space. Some industries can be very competitive, and you’ll need a decent ad budget to compete with other companies.
Before you write off RTB advertising for your company, consider a few benefits that you can get.
Bid for Ad Space
One of the biggest ways that an RTB ad can help new and growing businesses is that the publisher doesn’t select the ad. You don’t have to worry about a website owner or YouTube creator knowing about your business for your ad to appear on their content.
As long as you bid for content that’s relevant to your target audience, you can stand a good chance of winning an ad spot.
Each time a visitor clicks on a webpage or video, every company has the same chance to win. While budgets can differ, you may be able to win an ad slot occasionally with a smaller budget.
The bidding is also very quick, so you won’t have to worry about bidding going slowly. A winner will be chosen almost immediately after the auction starts.
Access to Analytics
If you buy ad space directly from someone online, you may not get to see how well your ad performs. You’ll have to ask the website owner or content creator for that information.
However, many ad exchanges will let you access the analytics and ad reports. You can use that information to determine how well your ad is performing.
Generally, you’ll be able to view a variety of metrics, including impressions and click-through rates. You may also be able to see how often your ad wins an auction.
If the ad is doing well, you’ll know to keep doing what you’re doing. But if the ad isn’t doing as well as you expected, you can make some changes. You can change anything from the content of the ad to the demographics you choose to target.
Depending on how detailed the analytics are, you may have to experiment more. But if you have access to more information, you will have a better idea of the changes you need to make.
Target Specific People
When you first start with RTB advertising, you won’t know what will work well. But you can choose to target specific types of people.
For example, an online women’s clothing store may want to target women over 25 years of age. You can tell the ad exchange that you want to target those customers.
Because of that, you won’t have to waste your ad budget on websites that primarily attract men or teenagers.
If you sell accessories for Androids, you can avoid advertising on content that heavily promotes Apple products. The more you know about what your ideal customer likes, the easier it will be to target them with an RTB ad.
Choose Content to Advertise On
While you won’t always know what content your ads will appear on, you can choose types of content you want to avoid. A lot of advertisers don’t want to pay for ads on videos or websites that mention obscene topics.
However, you may want to avoid certain types of content for other reasons. Perhaps you only cater to one local area. In that case, you can advertise on websites that also target people in your city or state.
If you offer products for families, you can avoid websites that are for adults only. Then, you can focus your ads on websites where potential customers will be. That will make your ads more effective, and it can save you money.
Why Not Use Real-Time Bidding?
Real-time bidding can be very useful for many marketing campaigns. You don’t have to worry about negotiating with a publisher for ad space, and you can reach a variety of customers.
However, there may be some times when an RTB ad isn’t the best option. If you want to create a more targeted ad campaign, you may prefer to work directly with the publisher of the ad.
Other ad methods can also be useful if you want control over the types of people who may see your ad. While ad exchanges can use your ad preferences, you can’t always control what ad space you’ll win.
Unless you have a massive marketing budget, you may not always have the money to spend on RTB advertising. You almost never know how much money you’ll spend on an ad, and you can never predict when you’ll win.
In some cases, you may spend nothing purely because another advertiser always out-bids you. On the other hand, you may end up spending more than you expect because you win more ads.
When you buy ads directly from a publisher, you’ll know exactly how much you’ll spend on the ad. If you have a tight advertising budget, that predictability can be crucial.
You may be able to input a budget maximum with an ad exchange, but it can be difficult to make the most of that money.
Lack of Control
While you can give your preferences for what types of content your ads will go on, you don’t have the final choice. You can say that you want to place ads in front of young adults, but the content might appear in front of young adults who can’t afford your product.
If you want to make RTB advertising work, you should provide as much information as you can about your ideal customer. Then, the ad exchange will better understand where your ads should go and what auctions you should be in.
Still, you can’t control when another company outbids you. And since the auctions happen so fast, you won’t always win. If you want to determine exactly where your ads go, you should buy ads directly from publishers and content creators.
Potential for Fraud
The internet is full of potential fraud, and that includes fraudulent traffic. It can be hard to determine if a visitor is real or fake, especially after the auction ends.
So if your ad wins for a fraudulent view, you’ll have to pay. Even for real views, you have to pay for the ad and not the clicks it gets.
However, your ad may not always show up in front of a real viewer. You can’t predict when you’ll experience fraudulent traffic.
Other types of fraud include malware, hijacked ads, ad placement manipulations, and popups.
While you might experience fraud with any type of online ad, RTB advertising can be especially vulnerable. And since you don’t have final say over the websites you advertise on, your ad may appear on a spammy site, which can also be problematic.
RTB Meaning and More
If you want to improve your online advertising skills, you should know, what does RTB stand for? Real-time bidding is a useful tool for reaching a variety of potential customers.
You can use the bidding to reach people even as a new business owner. But you should understand how to use it and why.
Do you want help with RTB advertising? Contact us for a free strategy session.