Real-Time Bidding Exchanges And The Rise Of The DSPs
With Facebook Exchange in the headlines for allowing Facebook to target users on their social metrics as well as their browsing history, the demand-side platforms (DSPs) that will serve up those ads are getting a lot of attention this week.
DSPs are delivering what standard CPM-based display units could never do: They’re targeting the right people with the right ads at the right time. The features and services differ from one DSP to another, but advertisers are seeing more accurate targeting capabilities, easy-to-use inventory control and bidding dashboards, and the ability to set frequency caps on the ads being served, which prevents annoying the user with the same ad too many times.
Real Time Bidding (RTB) is a dynamic auction process where each impression is bid for in real time. The potential advantage (versus a static auction where the impressions are typically bundled in groups of 1,000) are cost efficiency, higher performance and greater granularity with targeting and measurement.
DSPs give advertisers direct RTB access to multiple sources of inventory, streamlining ad operations with applications that simplify workflow and reporting.
The rise of online-advertising auctions has increased the data collection happening with most websites. The average Web page visit to sites owned by Google, Microsoft, Facebook, Amazon, Wikimedia, Apple, Yelp and Netflix now triggers 56 instances of data collection. RTB exchanges, where advertisers buy data about users’ Web browsing, contributes to about 40 percent of this data collection.
The online display-ad market is moving from a traditional advertising model, where 1,000 impressions are bought, to real-time bidding, where a single impression is evaluated and purchased. The number of data collectors and the amount of data collection are growing incredibly quickly. The number of companies that provide the tracking technology has grown to about 300 (versus 131 just two years ago).
The data collected is cookie data from a user’s browser. It includes the content you view, your interests, your age, your income, your education, and more. These things build the user’s profile and develop audience segments for the ad networks and exchanges, where it’s sold in real time.
Real-time bidding is huge. It was a zero-dollar industry five years ago and is now in the neighborhood of $5 billion. Advertisers aren’t buying an ad on a page anymore; they’re buying the audience to see that ad. They want scalability, they want attribution, and they want low prices. RTB delivers.
Credit card companies and phone companies have been collecting information about you for years. But while these services have access to your browsing history, they don’t have access to personally identifiable information. In addition, technologies like Do Not Track and Ad Aware and government interventions through regulation are forcing the companies and publishers to be more transparent and open about what is being tracked.
The following is a list of ad exchange players, courtesy of the Advertising Perspectives blog:
Yahoo’s Right Media: one of the first exchange, it is well positioned and has recently committed to offering more premium inventory.
Google AdEx: leverages the DoubleClick ad serving platform with RTB. As is typical with Google, the technology stack is the most sophisticated of the top-tier exchanges.
Microsoft AdECN: Microsoft’s Ad Exchange for the Microsoft Media Network.
AdMeld: helps premium publishers maximize revenue from their ad inventory, reduce operating costs and eliminate unwanted ads by giving publishers access to demand from ad networks, exchanges and DSPs.
PubMatic: an ad monetization and management solution that combines impression-level ad auction technology, brand protection tools and ad operations support.
The Rubicon Project: offers supply and demand platforms with integrated API’s for data providers.
ContextWeb: provides real-time contextual targeting.
AdBrite: an advertising exchange focused targeting and optimization, has real-time bidding, API functionality and a self-service account management interface.
OpenX: combines ad serving and yield management with RTB.
Media Math: a demand side buying and analytics platform that aggregates the AdEx, Right Media and AdECN exchanges.
DataXu: offers a real-time ad optimization platform which manages buys on an impression-by-impression basis across AdEX and Right Media.
AppNexus: a single-point integration to exchanges and inventory aggregators, including Google’s DoubleClick, Microsoft’s AdECN, and others.
Turn: a demand side platform with targeting, exchange integration and analytics.
Audience Science: specializes in segmentation and targeting data.
x+1: a targeting platform for advertisers and publishers. They also build dynamically assembled landing pages and micro-sites based on demographic and behavioral data.
Triggit: integrates with Ad Exchanges via its RTB Platform.
Invite Media’s Bid Manager is a RTB-buying application.
MARSHALL JONES 