Along came ad exchanges which allowed publishers to provide agencies and advertisers with direct access to their inventory and more transparency than many ad networks had. Although auction-based models à la search were introduced, the target segments were often pre-set and companies had to work individually on an exchange by exchange basis.

What advertisers really wanted was the ability to bid on relevant people, across ad exchanges, at a price that was fair. And that’s what real-time-bidding (RTB) is offering.

Two things have happened to make this a reality:

1. Agency groups have launched their RTB / trading platforms to enable them to run campaigns across ad exchanges (via demand-side platforms), allowing them to control the targeting, maximum bid levels and frequency of exposure.
2. Targeting has been improved by plugging in data from the likes of Exelate and Weborama to be able to re-target relevant cookie pools, wherever they are online.

And this is as relevant to B2B advertisers as it is to B2C. To give a relevant B2B example: imagine a typical IT vendor looking to target SMB IT and business decision-makers. In the past, the only route to this audience online would have been the tech and business publishers. With real time bidding, advertisers will still continue to use those targeted sites, however they will complement it by:

1. Re-targeting customers off their own site on the networks / exchanges – either to cross / up-sell with targeted messages or even exclude customers if repeat purchases weren’t likely.
2. Re-targeting prospects off the back of the advertising they are already running on targeted sites by building cookie pools and re-messaging them when they are encountered on the networks / exchanges.
3. Even re-targeting from social profiles on Twitter / Facebook in the same fashion as above.
4. Targeting prospects that have been identified by data companies as SMBs and or are IT/business decision-makers.

Although some of the re-targeting options were available already before, RTB means that the agency / advertiser is in charge of who you are bidding for (as opposed to the ad network) and what price you are willing to pay in an auction environment.

Data was previously a missing piece as well, and it’s still not brilliant for B2B / technology. We need publishers to get on board, selling their cookie pools for one off, re-targeting use in order to get sufficient audience volumes. Some publishers like Future have already done this, and more will follow as they recognise the additional revenue stream they can earn from their premium audiences.

To give an example, 100,000 people on a site may generate 1.5 million impressions; however on the rest of the Internet, the same audience will generate perhaps 30 million impressions, most likely more. Selling the data will provide publishers with an opportunity to monetise their audience many times over.

The implications of real-time bidding are vast:

1. It’s changing the face of the online ad industry: demand and supply-side companies have been forming all over the place and ad networks are being squeezed as budgets shift to exchanges, leading to consolidation in the market.
2. Online media buying decisions are being done within the auction environment more and more, with less focus on relationships and the speed of decisions and optimisations are accelerating, à la search.
3. Advertisers will be paying closer to the true value of audiences, cutting out the waste and providing more targeted (and sequential) messaging along the purchase consideration cycle and focusing on optimising against their ROI goals.
4. Power is being taken back to the agency and advertiser from the ad networks.
5. Percentage share of display advertising will increase.

Real-time bidding is transforming the digital advertising landscape as we speak. WPP has been investing heavily in the MIG to capitalise on the opportunity, strongly believing that technology and data combined will transform the industry.

Here’s a helpful, if somewhat confusing, overview of the change that’s taking place in online advertising industry: