What is Real-Time Bidding (RTB)?

RTB (Real-Time Bidding) is an auction for a single ad impression. While a page or app prepares a slot, DSPs receive a bid request, return a bid, and the winner serves a creative. The loop finishes in a fraction of a second (a common target is about 100 ms for a response). RTB is a deal rule inside programmatic advertising, not a feed product and not a platform brand.

The auction unit is the impression, not the click or the install. The winner is almost always billed CPM: you pay for the won impression even if nobody clicks. CTR and post-click CR are measured after the serve. Most exchanges speak OpenRTB (an IAB spec) for the request/response. A request typically carries slot (imp), device, GEO, and sometimes user/audience objects; a DSP may return a bid or a no-bid — a pass is a valid outcome, not an error.

How the auction runs

The user opens a page or screen; the ad server / SSP builds a request: slot, domain or bundle, device, GEO, sometimes audience and deal ID.
The exchange or SSP fans the request out to connected DSPs.
Each DSP decides whether the impression matches a campaign, what to bid, and which creative to send.
The auction picks a winner. Many exchanges historically used second-price (winner pays the second bid plus an increment). Since the late 2010s the open web is mostly first-price: you pay your own bid. That is why buyers shade bids and watch clearing price, not “bid minus one cent.”
The winner returns the creative; the impression is logged on both DSP and SSP.

Not every programmatic impression is an open RTB. A PMP uses the same protocol with a named buyer list and often a floor. Programmatic guaranteed books volume and price ahead of time: there is no real per-impression contest, or only a formal one.

RTB and nearby terms

A DSP buys: it filters the request and bids. An SSP sells: it emits the request and takes bids. RTB is the moment those bids meet.
Programmatic is wider than RTB: it also covers PMPs and guarantees without an open contest.
A bid strategy in the UI (target CPA, cap) is how the DSP computes the number in the response. RTB is the fact that this number competes for this impression.
Header bidding (its own article) is how a publisher asks several SSPs before its ad server. That is a demand-collection pattern, not a second definition of RTB.

What RTB is not: not RTB feed traffic

In arbitrage, “RTB” is often mixed up with RTB/XML feed traffic. A feed is a buying hook: the buyer hits a network API/XML, takes a stream of pop, push, native, or display, and filters GEO and domains in code — no classic UI. The wire format may be called OpenRTB, but that page is about the feed as a source, QPS, and macros on the win URL.

This page is the impression auction in the DSP–exchange–SSP chain. A feed may use RTB; not every XML stream is an open auction for a display impression (some feeds already allocate traffic under fixed rules).

Buyer practice

In the DSP, watch win rate, average bid, eCPM, viewability, and post-click metrics in the tracker. A high win rate with a weak CR means you are winning cheap or junk inventory. Bot traffic and non-viewable impressions still bill as impressions if filters did not drop the request.

A DSP timeout is a loss with no bid. Fees along the chain (DSP + exchange + SSP) sit inside the clearing price: a “$2.40 CPM bid” is not $2.40 to the publisher. For an offer, count cost per click and per conversion, not the elegance of the auction.