Market Advantages

Auction pricing yields fair market value

Traditionally, online media buyers have purchased ad inventory by negotiating a CPM price directly with the publisher. Auction markets (sometimes known as "spot markets") function very differently, because media buyers simply enter a bid price that represents what they are willing to pay for the inventory.

Each time a consumer visits the publisher's website and generates an advertising opportunity (ad impression), the market runs a real-time auction, in which every eligible ad competes for the impression. The ad with the highest effective price wins the auction and is displayed to the consumer. In general, the higher the bid price, the more auctions the ad will win, resulting in more impressions received. Auctions introduce fairness to both buyers and sellers, who can be confident they are paying and getting fair market value for ad inventory.

Market structure provides transparency and quality control

Networks, the traditional aggregator that most media buyers are familiar with, sell inventory on behalf of publishers and may also include "sub-syndicated" inventory. Sub-syndication means that the network receives the inventory from another network and may not know the original website generating the impression.

Similarly, exchanges function as a 'network of networks' by allowing networks to buy or sell inventory in a spot market. When a network contributes sub-syndicated inventory to an exchange, the exchange may not be able to identify which website is generating the ad impression. This puts advertisers looking for publisher quality control at a distinct disadvantage. What's more, when a network purchases inventory from an exchange, it can dynamically modify which ad (and therefore advertiser) is displayed, making it more difficult for the exchange to enforce publishers' editorial standards.

Market platforms like the Turn Smart Market differ from exchanges because they prohibit networks from buying or selling within the market. The end result: Turn ensures quality control by serving an ad only if the advertiser, publisher, and the web page generating the ad impression are known.

For more information, please refer to Turn's quality control for inventory and brand.