The ETA on RTB and Mobile

What’s the big deal with RTB and mobile these days? It’s a good time to get familiar since many major players in the mobile advertising space see it being the next big thing for 2013.

Wesley Biggs, co-founder and CTO of global mobile ad buying platform Adfonic, is one of those big players who forecasts Real Time Bidding transforming mobile media. For those unfamiliar with the RTB phenomenon, Biggs explains it in his AdWeek piece titled, Mobile Real-time Bidding: From Slow Waiting to Smart Crowds.

A common analogy used to describe the RTB process is the stock exchange; all Interested advertising parties simultaneously bid for a mobile placement with the set of qualifiers desired by an advertiser. Accordingly the highest bidder wins the impressions with this entire process taking place in milliseconds, as described by Biggs. (If you still want more clarity on how RTB works, take a look at this explanation from Crowd Science.)

Another co-founder for Adfonic, CEO Victor Malachard, similarly describes why he feels many advertisers will flock to this emerging platform for mobile media.

“Real-time bidding will also emerge to become the dominant way to buy mobile media, which involves using a programmatic, instantaneous auction. For most sellers, RTB is a simple proposition: they get greater control over their inventory and the ability to generate higher eCPMs, driven by lots of bidders competing for the inventory,” he said when speaking to Forbes in late October.

Despite increased fragmentation in the space, Malachard believes RTB solutions, like that offered by Adfonic, provide a wider range of inventory sources through a single point of purchase.

Brett Wilson, CEO of RTB buying platform TubeMogul, noted his thoughts on the platform’s ability to offer greater transparency to advertisers seeking a clearer understanding of what their buying offerings actually get them. Regarding a Forrester Research study commissioned by TubeMogul, Wilson said, “…Executives are moving from a world where they lean on vendors—’Here’s what I need done, don’t tell me how you did it’—to a world where they need control.”

Other notable digital publishers that have chosen to launch RTB platforms in 2012 include Vevo, Smaato, Juice Mobile and Nexage, amongst others.

Forrester Research stated in the same study that the shift towards RTB would move the digital industry away from the traditional buying model that has been mediated between ad agencies and sellers. Other industry forecasts anticipate a similar trend regarding the impact of RTB. eMarketer reported earlier this month that all RTB spending is expected to nearly double in 2012, with expectations for it to account for 13% of all US display advertising spend.

The potential for this increasingly popular automated process to change the anatomy of mobile buying as we know it is something to keep an eye out for in 2013. What are your thought on the impact of RTB on mobile media? Sound off your thoughts below.