Rules of buying traffic

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The ad tech industry has come a long way since the beginnings of the Internet. Back then, dealings between a publisher and advertiser had to be direct. Nowadays, there are various intermediating platforms that connect advertisers with publishers.

Most traffic sources have incorporated a programmatic buying technique, where deals are made by special algorithms. Most programmatic buying (but not all) is real-time bidding, or RTB. RTB is a purchasing model, in which an automatic auction is conducted for each ad impression.

It works like this: 

  1. A visitor loads a publisher’s page, 
  2. The page is loaded from a web page server and rendered by a visitor’s web browser. 
  3. The web server delivers all page content apart from an ad
  4. A special script that is put in place of an ad makes a request to the publisher’s traffic source (DSP, ad network, or similar) and then the auction begins.
  5. The traffic source checks for the highest bid among advertisers that fit the traffic targeting criteria.
  6. The traffic source collects the money according to the auction type and loads the advertiser’s ad.

 This all happens in milliseconds, before a web page fully loads.

There are actually two auction types:

  • First price auction, when the winning advertiser pays exactly as much as they bid for an impression.
  • Second price auction, when the winning advertiser pays the amount equal to the second highest bid in the auction.

You now know how traffic sources charge you for traffic. Now you have to decide on your budget.

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