Programmatic and RTB: do you know the difference?

Jess ThompsonCommunications ManagerMore about Jess

A common point of confusion in the world of digital media buying is the difference between programmatic and real-time bidding or RTB. One of these things is like the other, but they’re not the same. Programmatic is the automated format of ad buying, while real-time bidding is one type of programmatic, referring to a lightning quick auction that takes audience data into account to assess the value of an impression to a certain advertiser.

Programmatic vs RTB

So what is programmatic?

Programmatic uses technology to automate media buying and ad placement in digital space. It’s a much cheaper and more efficient way of media buying as it eliminates the need for salespeople, while reducing human error and inconsistency. Before you go worrying that machines are taking over, programmatic doesn’t make people obsolete, it just takes care of boring tasks like insertion orders and ad tagging, so people can be more effective.
Programmatic still relies heavily on people to customise and optimise campaigns to get the best performance and engagement Twitter icon Getting the mundane stuff out of the way empowers ad buyers to build more sophisticated strategies, get better analysis on campaigns and keep up with industry shifts.

Programmatic vs RTB

And what is RTB?

RTB is the buying or selling of ad space via an auction that occurs in the time it takes for a webpage to load – just milliseconds. Advertisers compete for an impression, or ad space on a webpage, with automated bids. The highest paying bidder wins the auction and gets the placement on the webpage, which is then loaded immediately.

Programmatic vs RTB
Programmatic vs RTB

RTB enables more specific targeting, since information about the user’s browsing habits are communicated in real-time Twitter icon from their browser to an ad exchange and are important for the outcome of the auction.

Reaching more relevant users cuts down on advertising waste – something the industry is infamous for. Using ad tech opens up a huge range of inventory across a wide-range of sites, meaning advertisers can be selective in choosing impressions that are most valuable to them.

Many advertising industry insiders predict that over the next five years programmatic ad buying will be the norm, with RTB being a big piece of that. Through the use of data and technology, programmatic brings greater efficiency and scale to campaigns Twitter icon Reaching the right person at the right time makes advertising more relevant and useful to its audience, making advertising better for all of us.

If you’d like to learn more about how you could get better performance on your advertising with programmatic, talk to one of our experts.

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