Real-Time Bidding (RTB): The Complete Guide

It’s a win-win situation where advertisers can target the most relevant users, and publishers can maximize the efficiency of their inventory.

Real-time bidding can be compared to a stock market, where the amount of demand at the moment determines the price of a stock. With real-time bidding, publishers set the floor price for an ad, but the demand still determines the final price. The whole process, from an app user triggering an ad request to the bidding process to the placement of the ad, happens in just 200 milliseconds.

The Difference Between Real-Time Bidding and Programmatic Advertising

Is programmatic advertising different than real-time bidding? There is some overlap, but the words RTB and programmatic can’t be used interchangeably. Programmatic advertising is a form of purchasing ads that utilize technology to automate and streamline the process. However, programmatic advertising isn’t completely automated, as there needs to be a person to define the parameters of the advertising campaign, such as target audience, geographic area and desired ad format (video, native, display, etc.). However, once those parameters are defined, programmatic advertising streamlines the ad purchasing process through automation.

The advertisers involved in RTB use programmatic advertising to improve the efficiency of their campaigns. RTB is therefore programmatic by nature, as the bidding process is automated. The difference is that while RTB utilizes programmatic advertising, not all programmatic advertising uses RTB. For example, advertisers can programmatically purchase inventory directly from publishers instead of bidding on an open market with RTB.

In short, RTB is always done through programmatic advertising, but programmatic advertising doesn’t always use RTB.