The short answer is yes. Connecting your site to an SSP, or RTB exchange opens your inventory and your users up to being tracked by as many DSP buying platforms as are enabled on your inventory.
Every impression is put out to bid, along with that a user identifier is passed. This gives the buyers the information they need to make a decision, “Do they buy or not?” If the buying platform decides to track the user and build a profile on that user’s behavior, there’s little the publisher can do from a technology perspective. The shorthand for this misappropriation of information is Data Leakage.
Sell side platforms and exchanges generally have contracts that restrict buy side platforms (DSPs) from taking advantage of this situation. Data leakage was a serious concern in the early days of RTB and publishers were quick to ask for assurances from their SSP partners.
It’s a two-sided issue, though. The publisher is concerned about their user population being profiled, tracked and then purchased on cheaper inventory. The buyers have concerns about their advertiser intent data being tracked. The publisher can use this data to raise prices on the inventory or cut the buy side platform out of the deal.
Both buy side platform companies and sell side platform companies are striving to introduce more controls over inventory and ad deals in RTB. The concern over data leakage has largely been subdued. Higher valued inventory and advertising is being sold privately using enhancements made on the RTB ecosystem. These private exchanges limit the exposure of high-value inventory to a subset of buyers and vice-versa.
Online advertising transactions are all CPM based. You might think my wild assertion is out of line. You might think you’re buying ads on a CPC or a CPA basis. But when a publisher is looking to sell ad inventory, they’re thinking about the CPM. “How many dollars can I get for every thousand ad views?” And when that CPA deal or that CPC deal comes in the publisher’s doing the math to convert that number into a CPM.
For a CPA deal they’re estimating how many acquisitions they can send to the buyer for every thousand ad views. For CPC, how many clicks per thousand ad views. They’re boiling it down to a CPM because that’s how they can compare the deals. It works like this all the way up and down the funnel.
The CPM has been around for a long time. With the advent of the RTB auction model, the CPM is very dynamic. Each impression up for auction is individually valued based on countless bits of information about the user, the page, the size, the date, the historical performance and a variety of other variables. Even though a separate auction is run for each impression, the bid prices are still in the form of a CPM. It’s in our blood. It is the end result of normalizing the value of an ad impression so that it can be compared to its peers.
I want to point out a couple of problems with the CPM. First and foremost, it’s a single number. This aspect causes a couple of secondary problems that put the buyers at risk. One of the big ones is that there’s no guarantee that the ad will actually show on the page. Steps have been taken to address this by several companies. The result of this problem is a topic near and dear to my heart: discrepancy. Read more
When multiple advertisers are bidding for a certain (impression) and more than 1 enter the same bid amount, (each) being the highest, how does the RTB (auction) determine which ad should be displayed. This question was asked on quora, below is my answer.
Identical bids are not unheard of, but they are rare. Bid prices are presented as a CPM value with up to five decimal places. That means that the actual impression can bid upon with precision down to eight decimal places. So in that rare event, when there are two or more matching top bids, the winner is chosen at random. This is only the tip of the iceberg, though.
Features are being added to RTB systems that allow for preferential treatment of preferred DSPs, agencies, trading desks and even advertisers. Deals that are struck between site owners and buyers are being executed through the RTB infrastructure. Those deals can supersede standard auction mechanics, resulting in a winning ad from a preferred partner in the presence of matching (or higher) bids from other parties.
As time goes on and the RTB system is exploited for more and more features, having equal footing in an auction will be more rare, relatively speaking. There will always be general auctions where no bids are given special consideration. We are, however, entering an era where premium inventory is available to buyers through RTB. With that inventory comes a more carefully crafted environment to buy and sell.
Rather than Small Business Advertising, I was going to title this post, “Eating your own dog food,” but I decided that a more descriptive title would get the benefit of SEO. I recently took on the task of advertising for my wife’s small business, here’s our story.
Leslie Smith MD
My wife’s acupuncture practice recently moved into a larger space; her patient capacity almost doubled overnight from one to two treatment rooms. I say “almost” because she’s still just one practitioner. With acupuncture, once the patient has been needled, they simply rest comfortably in pin-cushion mode. The practitioner doesn’t need to be in the room. That’s where my wife takes the opportunity to start treatment on a patient in room number two.
I took it upon myself to do some online advertising for her practice to fill up that second room as frequently as possible. Now, my wife is not your typical acupuncturist. She’s an herbalist, a holistic medicine practitioner and, most uniquely, an MD. One would think that her résumé would do the marketing for her. That’s not the case, obviously. We have to let people know just how fabulous she is. So, here’s the long story of how I used my background in advertising, my wits in video production and my fabulous wife’s personae to kick off her marketing push for the new office. Read more
Why historically (and currently) only one single bid was allowed for each DSP per impression? Why hide demand from the exchange and create opportunities for the DSPs to arbitrage? – I know this is changing now with the possibility of multiple bids per DSP (openRTB v2) but why ad exchanges let this happen at the beginning? This question was asked on quora, below is my answer.
A multiple bid response was discussed at the very first OpenRTB meeting. It was not seen as a favorable feature by the demand side, at first. They preferred submitting one bid. Supply side partners were not in a position to force the issue, nor had the necessary research been done to support the idea.
From the supply side’s perspective, as with many transaction systems, early efforts in RTB were focused on connecting the pipes. RTB represented a new source of demand and the pressure was applied to getting plugged in to as many DSPs as possible. Read more