Real-time bidding, in its simplest form, is a method is which media impressions are bought and sold between advertisers and publishers in an auction that occurs in real-time as a user is loading a website.
Every advertising technology company will use real-time bidding in a different way – that’s what sets companies apart. Here is how Katch’s real-time bidding feature works.
- A brand (or publisher) determines which media they wish to put on the market for advertisers to bid on. They also determine which advertisers they would like bidding on their media.
- An advertiser logs into the brand’s private exchange, which is powered by Katch. The advertiser sets their consumer parameters for bids, perhaps by geographic location, age, or other attributes that their ideal consumer may have.
- Katch’s algorithms take into consideration bid amounts, consumer parameter settings compared with who the user is, advertiser click-through rates (CTRs), and other factors to determine the ad that will appear in the most ideal location on the brand’s website.
The benefit of using real-time bidding as part of a private exchange versus automated guaranteed – where there one a set price for a certain media spot – is that real-time bidding greatly enables an open-market ruled by the laws of supply and demand. The higher the demand for certain consumer attributes, the higher the bids will be to advertise to consumers who bear those attributes. The result is brands or publishers knowing that they’re getting market prices for their inventory.