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Instant Ads Set the Pace on the Web

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At AppNexus, from left, Michael Rubenstein, president; Brian O'Kelley, chief executive; and Mike Nolet, technology chief.

Joshua Bright for The New York Times

Advertisers have been able to direct online messages based on demographics, income and even location, but one element has been largely missing until recently: immediacy. Advertisers booked slots in advance, and could not make on-the-fly decisions about what ads to show based on what people were doing on the Web.

Now, companies like Google, Yahoo and Microsoft let advertisers buy ads in the milliseconds between the time someone enters a site’s Web address and the moment the page appears. The technology, called real-time bidding, allows advertisers to examine site visitors one by one and bid to serve them ads almost instantly.

For example, say a man just searched for golf clubs on eBay (which has been testing a system from a company called AppNexus for more than a year). EBay can essentially follow that person’s activities in real time, deciding when and where to show him near-personalized ads for golf clubs throughout the Web.

If eBay finds out that he bought a driver at another site, it can update the ad immediately to start showing him tees, golf balls or a package vacation to St. Andrew’s, Scotland, often called the home of golf. If a woman was shopping, eBay could change the ad’s color or presentation.

“The biggest problem with advertising was that decisions about what ads to show were made way in advance of when they actually appear,” said Brian O’Kelley, the chief executive of AppNexus. “There are a lot of reasons you want to make those decisions as close to when the ads run as possible.”

From The New York Times
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