An Assessment on Real Time Bidding Strategies for Advertising Markets

Abstract

With the advancement in the advertising industry, Real-Time Bidding (RTB) is become the most promising framework for the ad-space auction. The main challenge in RTB is to handle the highly dynamic nature of the data and do computations with this exponentially growing data, so that the involving agencies get high Return of Investment (ROI). In the RTB process, advertisers buy ad-space (impressions) published by the publisher (website owner). When user visits a webpage, an ad-space is created. If ad-space is not reserved for any specific advertiser then publisher ad-server auctions it on the open ad-market. Publisher ad-server connects to the Server-Side Platform (SSP), SSP sends the ad-request with auction information (like web cookies, unique visitors, page views per visit, sessions etc.) to Ad-Exchange (AdX), which further send the ad-request to DSPs. DSPs bid on the behalf of advertisers for the ad-space and submit it to the AdX. The winner, who bids more than other competitors, will win the auction and display her ad to the publisher website. In RTB, there are two important bid price models, from the view of advertiser. One is to estimate the utility and other is auction cost. The former deals with the probability of user responses towards displayed ad (i.e. determination of Conversion rate (CVR) and Click through Rate (CTR)) and later deals with the amount paid by the advertisers after winning auction. In this paper an attempt has been made to provide insights about the bidding strategies from demand and supply side platforms. The motive is to give detail about real time bidding strategies with the future work guidance.