This is an unbaked opinion piece. Please comment to keep the conversation going as this will certainly provoke some commentary.
I’ve been participating in many conversations (conferences, panels, articles, journals, meetings, etc) about Real Time Bidding and it’s potential affect on digital media. There are very few true real-time-bidding inventory sources today and only a few Real-Time Ad Platforms (i.e. AdNexus). Without revealing too much information from our day to day in the office, we see that less than 25% of our inventory is coming through Real-Time Bidding. According to conversations with our peers, this is fairly consistent with the industry.
The big question is not whether RTB is coming (or here), but rather if you (as a marketer) need to harness it.
Demand side platforms (DSP) build/buy/partner with RTB-enabled platforms
If the big agency holding companies have their way (note: I’m part of MDC Partners), then the majority of standardized display will be running through these platforms. If these platforms and capabilities are RTB enabled and the processes and procedures are in place to run in Real-Time, then there can be a very large demand (liquidity) for RTB enabled inventory. This means that the Supply Side Platforms need to on-board enough inventory to be sold in Real-Time. I include data (& audience) within the “inventory” label. 1st, 2nd, and 3rd party data (& audience) needs to be RTB enabled as well.
You need both the Demand Side and Supply Side to be real-time enabled to make this happen.
This theoretically seems easy, but how many “big-name” publishers are real-time-transaction enabled? The majority of RTB inventory is long-tail today… and this needs to change to really attract the significant dollars to this space. The Supply Side will either aggregate at large exchanges or use Supply Side technology to make this happen.
If you do not buy in real-time, can you exist in the future? Simple: yes.
I know people in the marketing space (including myself) are trying to draw parallels to the financial markets and I’ll continue to do so here. There are many financial brokerages that have access to transact very quickly and they do. But other brokerages and buyers are able to transact (with significant dollars) in near-real-time (or less than near-real-time) and still be in solid financial positions and the ability to move markets.
Speed does not guarantee success in markets: finance or marketing. The art of orchestrating the sciences is where the men are going to be separated from the boys. You can give me access to AdNexus tomorrow morning and just because it’s fully RTB enabled, does not mean I’ll be any better than buying site direct or thru a non-RTB network.
Unless the algorithms and the “view” of real-time inventory is exactly the same, no two RTB platforms will perform exactly the same.
Have I convinced you that you do not need real-time bidding to be successful today?
Now the contrary: The faster an RTB platform can operate (in milliseconds today), the more inventory it has access to. This is a big deal. If you are building models to predict the future, then you want to see as many impressions as possible to have access to pick from. Some say buying clout does not matter but does it? A question to ponder.
The net/net: RTB is a buzz word today and many people are talking about this space. I believe that where there is smoke there is fire, thus, there is something to take note about RTB. With the opportunity to value individual impressions and data with the ability to go the last mile and action it, potentially ahead of competitors, RTB does have an edge to those who can use it.
I believe that the long term winners in this category will not be the scientists, but rather the artists who know how to apply the processes, procedures, and strategies for their clients.
Please comment to keep the conversation flowing. Would love to hear your perspective.