Many in business find it difficult to differentiate real-time bidding (RTB) from programmatic.
But mixing the two up can have drastic effects on marketing activities and outcomes. Progress in the advertising world is fast and marketers will need to grasp new concepts in the near future.
Programmatic is workflow being automated by some technology. In the digital advertising domain, programmatic is essentially communication between two computers to enable accurate trafficking operations in any campaign.
It can minimize the risk of human functional error and in this arena, an individual defines the essential attributes required for a campaign, and ad tags get transmitted into the domain ad server automatically.
Certain channels in digital media have been inherently working with programmatic. Hence, training on special programmatic lingo isn’t required to differentiate the processes.
Real-time bidding (RTB) is a protocol in technology that does automatic buying, selling, and bidding of impressions or advertisements using the auction format. It is like programmatic, but the two are not synonymous. RTB is one of the characteristics of the programmatic mechanism. In fact, Programmatic is a bigger superset containing RTB.
A programmatic advertising solution is a technology process which lets advertisers target customers accurately and automatically. The targeting is performed taking into account some metrics extracted using algorithms. Earlier, if a toy brand wanted to target, the first pursuit was kid’s sites. The technique used to target consumers today is way different. Brands can target any site after collecting information like family details, age, geographic location, which sites the prospect, has been to, and also if there has been a history of purchasing the same types of products earlier.
Whenever there is an online auction, there is ad buying and selling within the short span of time it takes your website to load (200 milliseconds). The entire process is conducted by an ad exchange that works by connecting advertisers and publishers.
How RTB Functions
When an ad impression loads in a user’s browser, there is a massive user-related information transfer to different advertisers. If they are interested in the particular user, they begin with the bidding, and the highest bid wins.
But, that sounds like programmatic. So what’s the difference?
Through programmatic, you can identify if advertisers are willing to buy a certain inventory space. With RTB, you are actually buying the inventory space.
Hence, RTB is an inherent part of programmatic. Yet, everything that is programmatic may not essentially be RTB. It is one essential feature of programmatic technology. At the time of its emerging in the online market, advanced players understood what it meant. Simultaneously, companies dealing with ad-tech enterprises created real-time bidders in their domains. Then the industry realized that technological developments could not be bound to just auctions. Enterprises could have frictionless buying across a wider platform.
Farsightedness is becoming inherent to the digital market. The term programmatic has revolutionized the entire layout of online media buying. Before that, the rave was RTB—an ad-tech tool that worked for auction in online media. The process has evolved and expanded to programmatic, bringing many more digital media tools. In case you cannot distinguish between the two, you will be missing the latest technological transitions in the digital domain.