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Ad Exchanges offer many benefits for both publishers and advertisers. They provide publishers with a way to manage ad position on websites, ad formats, customized styling, such as fonts, colors and other parameters. They also allow them to manage CPMs, apply sophisticated filtering and sell excess ad inventory.
Real-time bidding allows advertisers to bid on individual impressions. As supplemental information is provided for each offered impression, its perceived value for advertiser can be more precisely calculated, leading to more cost-effective marketing campaigns.
Through analysing results of marketing campaigns on individual or aggregated impressions, advertisers can gain important insights on important drivers for their KPIs.
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These different platforms work together to get ads in front of the user. Before explaining how the different platforms work together for real-time bidding, let’s talk about what each platform does.
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Unlike real-time bidding, which involves selling ad impressions through a single auction, header bidding opens the floor to multiple demand sources at once, potentially increasing revenue for publishers by creating more competition for their ad inventory.
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Header bidding is a pre-auction process that allows publishers to simultaneously solicit bids from multiple advertisers or demand sources before calling the ad server, ensuring that they get the highest possible bid for their ad space.
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Through programmatic advertising and an exchange, the advertisers can determine which users are the most valuable and then adjust bidding accordingly.
This happens through auctions on Ad Exchanges, where publishers offer their ad inventory and advertisers bid on them, with winners’ ads finally shown to the visiting user.