Real-time bidding helps solve these problems by allowing marketers to buy known audiences. Click to open a web page and an automated auction begins. Firms bid to serve an advertisement, taking into account where it will appear and what they know about the presumed viewer from digital traces he has inadvertently left around the web. The winner serves the advertisement, often customising itso you may see more ads for convertible cars on a sunny day. The whole process generally takes some 150 milliseconds, or less than half the blink of an eye.
Many online adsparticularly the expensive ones that appear on home pagesare bought and sold much like old-media advertisements. A seller agrees on a price with a buyer, and then pays for lunch. But many publishers sell only one- to two-fifths of their online ads directly, says Jay Stevens of the Rubicon Project, a California firm that works with many of them. The rest are offloaded to digital middlemen. It is in this high-volume, low-cost market that real-time bidding is advancing. In the past year, says Mr Stevens, real-time bidding has risen from almost nowhere to capture 30-40% of spending.
Real-time bidding makes it easy to aim ads at susceptible eyeballs. Firms such as John Lewis , Zappos and Lenovo know that you have visited their websites because they dropped digital markers onto your computer. They then outbid others to reach you again. This is called retargeting.
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2016-02-26
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