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Media and Communications

Online Ads 101: The reservation buying process

Online Ads 101: The reservation buying process

In online advertising, there are many ways
to buy ad space on publisher websites. In this example, we’ll look at the process
of buying ad space directly from the publisher. At an advertising agency, it’s the job of
a Media Planner to figure out where their client’s ads will run. So, if the client is
selling pro-sports fan gear, then they’ll want to show ads on sites where sports fans
hang out. Once the Media Planner has picked the websites
where they want to run their campaign, they’ll contact the publisher directly with an RFP,
or Request For Proposal. The RFP outlines campaign goals, run dates,
and target audience. It also includes budget details, like how many clicks or impressions
they hope to get.. and how much the agency is willing to spend. When the publisher website receives the RFP,
they’ll review the list of requirements and the agency’s budget and compare it against
their available inventory. Inventory refers to the number of ad slots a publisher thinks
they’ll have available on specific pages on a given day. This can be tough to determine since publishers
don’t know exactly how many visitors will come to their site, let alone which cat video
will be most popular on a particular day. While nobody can predict the future, publishers
use prior trends to estimate how many visitors will view pages on their website. This is
called forecasting. If the publisher has inventory that matches
what the agency’s looking for, they’ll return the RFP with a list of options and prices. When the agency and publisher agree on the
number of impressions or clicks, as well as the cost, the agency creates an IO, or Insertion
Order to seal the deal. The agency signs the IO and sends it to the publisher. Once the
IO is signed by both parties, it’s considered a legally binding contract. After the campaign goes live, the publisher
serves the client’s ads as promised. And.. when the campaign is over, the publisher sends
a bill for the ad space so the agency can keep up their end of the deal. And then, everyone is happy.

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