Lets start by de-mystifying some of the most common industry language and jargon you're going to hear trotted out at nearly every website about internet advertising. Understanding these will make de-ciphering what people are really selling to you much simpler.

DSP being a relatively new term at the time of this post, its actual definition is still being formulated and evolving. Many see DSP's as middleware. They provide advertisers and agencies the ability to buy across exchanges and other sources through a single interface. Thats a great starting point. More on this as it develops.

RTB is another new term in the industry but unlike DSP this one is fairly well defined.

RTB enables ad networks, exchanges and DSPs to analyze each impression and bid accordingly in real time as well as optimize in real time using the real time bidding data. Wow, thats a mouthful.

Think of is this way. In the past media buying was done primarily on a "futures" model. Buyers bid on publisher placements in the future. The advertiser must trust that targeting parameters for their buys are implemented properly by the publisher or network. RTB turns this on its ear.

Each impression that comes in is evaluated in "real time" and bidding takes place based on the results of that evaluation. Advertisers still set their parameters but they are in control.

Ad Networks are companies that connect advertisers to websites that want to earn revenue from advertisements on their properties. Networks typically aggregate ad space supply from publishers (website owners) and match it using targeting and other parameters with demand from advertisers. There are 3 main types of networks;

• Vertical networks offer ROS (run of site) buys for advertisers in niche markets or specific channels. e.g. Automotive sites or Football sites.
• Blind Networks offer great prices for advertisers in exchange for more leniency from the advertiser on where ads are going to run.
• Targeted Networks focus on specific targeting technologies such as user behavioral targeting or contextual targeting.

Networks also fall into tiers.

• First Tier networks have many of their own advertisers and publishers, typically high quality traffic and they serve both ads and traffic to second tier networks.
• Second Tier networks may have some of their own advertisers and publishers but the bulk of their revenue comes from working with other networks.

Ad exchanges provide a very similar service to a DSP. Exchanges function as middleware however, they focus instead on Ad Networks and Agencies as clientele instead of individual publishers. Exchanges provide excellent reach and typically very good price. Companies that hold seats on the exchanges vary greatly and while they may operate on the same platform, they have very granular control over how they do business in that environment. Much like two companies that both use computers. While the computers may run the same OS, the companies can function very differently and use the computer as a tool in their own way.

Websites that are deemed safe for brands to advertise on without concern for the integrity of their image. Brand Safety is highly subjective and depending on the provider you are working with can really be across the board in definition. It is in your interest to find a provider with similar sensitivities to yours from both a publisher and advertiser perspective.

Run-of-Site. Ads run across an entire site, not just selected sections.

Run-of-Network. Ads run on all sites in a network.

Also called Passbacks, these are ad tags that a publisher provides to a network that "passback" traffic when a rate floor or other limit is reached. Not all providers accept passback/default tags.

Public Service Announcement. Ads that serve when no other eligible ad can for any reason. These ads carry no monetary value for the provider or publishers.

Cost per Mille (per thousand). A rate of measurement and payment used in many kinds of advertising where the traffic supplier is paid a rate per thousand ad views.

Cost per Click. Traffic suppliers are paid when a user clicks on an ad.

Cost per Acquisition (or action). One step further than a click, also called a conversion. To cause a revenue event, the user must perform a specified action. That action could be anything from making a purchase or providing an email address to simply arriving at a landing page.

Click through Rate. The percentage value of clicks per total number of impressions. Calculated via: (CLICKS / IMPRESSIONS) * 100

Click to Conversion Rate. The percentage value of conversions per total number of clicks. Calculated via: (CONVERSIONS / CLICKS) * 100

A file containing user information recorded during the users first visit to a website or view of an ad. Cookies are used to tailor campaigns to users as well as include/exclude users from campaigns.

Referring to unique traffic, uniques are site visitors that haven't been served an ad at your site during a given time period. Usually that time period is 1 day. Uniques by nature are more valuable to advertisers and garner higher rates. With subsequent views the value of the visitor drops.

A measure of time since an ad has been served or a measure of time since the most recent visitor.

How many page views an individual user has seen during a given time period. Works in conjunction with uniques and as frequency rises, value of the user declines.

Geographical targeting. Automatic segmenting of visitors based on location. Currently US traffic holds the highest value for most campaigns. Rates for various locales fluctuate depending on the target market and the provider you work with.

Targeting of ads based on the content on the page (the context). This can sometimes cause problems with competition appearing on your site. That issue however can be overcome with proper filtering at the provider level.

The targeting of advertisements based on tracked user behavior. Through cookies or unique browser fingerprints ads are displayed to users with their web activity in mind. e.g. if you've been visiting lots of automotive sites, a automotive manufacturer might want to target you as an intender (intending to buy).

Using cookies, advertisers can determine whether they'd like to include or exclude a particular user based on their activity with the advertisers website or previous ads. e.g. You visit a site but dont buy anything. The advertiser may want to target you with additional offers or a better offer. Once you buy, the advertiser will want to exclude you so they dont spend their budget on an existing customer.