If you’ve read part one of this blog series, you should have a fairly solid understanding of why online video advertising is quickly being adopted by brand marketers. To get up to speed, click here.
As advertisers continue to recognize the importance of the Internet as an effective and efficient medium to reach audiences at scale, they are starting to allocate more of their advertising dollars into online video.. With this, real-time bidding has emerged as a major option for buying online video advertising.
What exactly is video RTB?
Buyers and sellers will use a technology platform to bid on each video ad impression in real time. You could compare this technology platform to the NASDAQ in that multiple buyers are bidding on stock and the highest bidder wins the right to buy that stock. For Video RTB advertising, instead of buying stock they are buying video ad impressions. Multiple advertisers will compete against each other in this RTB auction to target their video ad specifically to you. Why you? Say for instance you visit ABC.com daily. You’re a news lover and a reader. A company like Amazon.com sees your traffic in an RTB auction, knows you’re a reader and wants to sell you a Kindle. They then bid against other advertisers to have the opportunity to run their video advertisement before you watch the video content that you are interested in viewing on ABC.com.
Video real-time bidding is quickly becoming a major player in the online video marketplace. In fact, Forrester Consulting found that now more than ever, digital, print, TV and agency trading desk buyers are looking to tap into online video ad market; a factor that increases real-time bidding ad revenue from $387 million in 2012 to $667 million in 2013. Forrester Consulting outlines the following three factors that are contributing to the explosive growth of ad bidding in the online video marketplace:
* Display RTB has paved the way for video RTB since buyers and sellers already have experience working with display RTB buys
* The ability to “buy your audience” has greatly increased the attractiveness of real-time bidding to online video advertisers by being able to optimize to their target audience in real-time
* CPMs (cost per thousand views) are increasing daily as buyer demand outweighs supply
Online video advertising is gaining such prevalence in today’s society, and real-time bidding will continue to explode and function as a typical auction. Read the final blog in this series as discover how video ad bidding continues to change every day.