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The Process of Programmatic Buying (RTB)‎ Explained

In this article we will discuss the more technical process of ad buying and selling by using the ‎programmatic buying and selling process (also referred to as RTB).‎

What is RTB?‎

Programmatic buying or Real-time bidding (RTB) is a method of selling and buying online display ‎advertising in real time. The method is based by buying one ad impression at a time. As opposed to the ‎traditional inventory buying, RTB acts just like a stock exchanges and utilizes computer algorithms (i.e. ‎Programmatic) to automatically buy and sell ads in real-time. For the advertisers, RTB offers the ‎possibility of buying only the impressions they need at a price they are willing to pay by utilizing ‎proprietary optimization algorithms of DSP systems and data from various 3rd party providers to fuel ‎their algorithms.‎

How does the process works?‎

The players in this process are the User, the Publisher, the Supply-Side Platform or Sell-Side Platform ‎‎(SSP), the demand-side platform (DSP), the Ad Network, and the Ad Exchange.‎

‎1.‎ A user navigates to a publisher website.‎

‎2.‎ The publisher’s web server loads up the web page and sends back an HTML code.‎

‎3.‎ The browser is then notified on where to get the content and how to set it on the page. ‎

‎4.‎ Part of the HTML code returned to the browser will include a coded link known as an Ad Tag. ‎That part is the same as in regular 3rd party ad serving (non-RTB). ‎

‎5.‎ The Publisher Ad server will return a tag that points to a RTB-enabled SSP, typically through a ‎dynamic JavaScript tag that passes information like the publisher’s ID, the site ID, and ad slot ‎dimensions. From there, the user calls the SSP server where the SSP reads that user’s cookie ‎ID.‎

‎6.‎ Assuming the user already has that SSP’s cookie on their machine (and most users will) the SSP ‎starts the auction by requesting bids from a host of demand sources, the DSPs.  ‎

‎7.‎ If the user does not have an SSP cookie on their machine, their ad inventory can still be ‎auctioned, but since nothing is known about that user, the price will be very low and more ‎related to the site context than the user’s attributes.  For the DSPs to set a high price on ‎impression they need to know something about the user.  This is where the SSP cookie ID ‎comes in – packaged with the bid request is the SSP’s cookie ID.‎

‎8.‎ Using all data, the DSPs all value that impression and submit a bid back to the SSP as well an ad ‎redirect to send the user should their bid win the auction.  ‎

‎9.‎ The SSP picks the winning bid.‎

‎10. The DSP redirect the winning bid back to the user.  ‎

‎11.‎ From this point on, the process is the same as simple ad serving – The user calls the DSP.‎

‎12.‎ The DSP sends the user the ad server redirect.‎

‎13.‎ The user calls the ad server and it serves the user the final Ad to be seen on the website.‎

In summary, the SSP is a technology platform with the single mission of enabling publishers to ‎manage their ad impression inventory and maximize revenue from digital media.‎

The DSP is a system that allows buyers of digital advertising inventory to manage multiple ad ‎exchange and data exchange accounts through one interface. Real-time bidding for displaying ‎online ads takes place within the ad exchanges, and by utilizing a DSP, marketers can manage ‎their bids for the banners and the pricing for the data that they are layering on to target their ‎audiences.‎

All these factors and more help the DSP value the impression and with that to ‎programmatically choose the Real Time Bidding on this specific user. As explained, the DSP is ‎able to match the SSP’s cookie ID to their own cookie on that user, which is tied to a huge ‎cache of marketer data and 3rd party data.‎

Programmatic buying and selling ‎(RTB)