What are Real Time Bidding & Programmatic Buying?

Featured Image courtesy of Stuart Miles at FreeDigitalPhotos.net

Chuck Fetterly, TEC Direct Media’s Founder and CEO, answers questions about Real Time Bidding (RTB) and Programmatic Buying.

There’s been a lot of press recently about Real Time Bidding. What do your clients need to know about it?

That it can work very well for them.  Real Time Bidding [RTB] is a method of selling and buying display advertising.  Our buyers use RTB as an effective buying tactic because we can secure a hell of a lot more impressions by using it…so we can do a lot more now with modest budgets.  And contrary to popular belief we’re now using RTB to buy display and pre-roll inventory.  Mobile inventory is slowly becoming the next great addition to the RTB frenzy.

What do you see as the key benefits for your clients?

Real Time Bidding
Image courtesy of Stuart Miles at FreeDigitalPhotos.net

There are several: efficiency, targeting, transparency.   Let’s first consider efficiency.  By using RTB we’re routinely securing inventory at a much lower cost than when dealing with a publisher or ad network.  We are no longer held to purchase minimums or seeing results crushed by premium CPM’s. But the real power is combining RTB with programmatic buying.   We do this through our platform, TECX.

We can now evaluate and bid on each individual impression.  This not only allows us to effectively buy audiences, but to do so on a large scale, thanks to massive reach offered by the RTB supply side.  And we can build campaigns using multiple tactics across display, mobile and video.  We can design several targeting strategies within these tactics from the most basic ‘site buys’ strategy to ‘retargeting’ to custom audience segments with the help of layering on third party data.  And we do this all with RTB and programmatic buying. But it’s the transparency and results we love the most.  High def reports with granular insight turn investment into results.

Sounds easy. You push a button and let it go?

One would think.  But that’s not the case at all.  All this data and technology supporting RTB and programmatic buying require more agency support, not less.

While programmatic campaigns are automatically triggered by a type of event and deployed according to a set of rules applied by software and algorithms, human skills are still needed in programmatic campaigns to plan, continuously optimize performance, analyze results and provide insight.

Are your clients accepting RTB and programmatic buying?

It’s been a bit of an education for all of us.  But when we can sit down and show a client how it works, the light bulb goes off and many say – “this just makes total sense.” And it does.  The naysayers will balk and say the inventory is lousy, it’s third tier sites, inventory is below the fold, etc.  That may have been the case in the past, but today we’ve access to great inventory, lower prices, position and can track performance. Our music clients are enjoying better reach and discovering new audience segments with better CTR’s.  Our home entertainment [Blu-ray disc and DVD] clients love the placements on top video sites that deliver high engagement rates.  And our direct response [DR] clients are absolutely winning with the high reach and frequency campaigns that RTB and programmatic buying can deliver.

So when’s the best time to use RTB and programmatic buying?

Every campaign is different and we look at each and every media option but I must admit, we’ve been suggesting a budget allocation to RTB on almost every digital buy — we believe in it that much and frankly, our clients need to squeeze every impression out of their investment.  RTB can definitely help.  But in the end it’s only one approach.  There are still times when a particular site is a must buy or another strategy takes precedence.

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