AdBrite brings together thousands of advertisers and publishers in a real-time auction for ad space. It’s like the stock market, only we’re a place to buy and sell online advertising, rather than stocks.

As advertisers set up their targeting parameters and create their ads, the ads are automatically entered in AdBrite’s auction, along with the corresponding bids. When publishers enable their site to run ads, the publisher zones created are automatically part of the inventory that advertisers bid for.

Here’s how it works:

1. Every time a user views a page on the AdBrite network, our system determines the most appropriate ad to show to that user via a real-time auction. AdBrite OTX (Open Targeting Exchange) ensures that the lastest targeting technologies are deployed to serve the ad.
2. For a given user requesting a given page, we find the pool of ads that match the appropriate ad format and user targeting criteria. For example, a young male user in New York viewing an entertainment site will draw from a different ad pool than an older woman in LA on a page about sports.
3. Once we’ve defined the available pool of ads, we choose the highest yielding ad. For banner ads and Full Page Ads, we choose the ad with the highest bidded CPM (cost-per-thousand impressions). Auctions for text ad space factors in CPC (cost-per-click) bids and click rates of the eligible ads. In all cases, the highest bidding advertiser is charged one penny more than the second highest bid, regardless of the original max bid.
4. Once an ad is shown, we store click data and other statistics to continue improving relevance and maximizing yield for participants in the marketplace.

AdBrite runs nearly 1 billion such calculations each day — one for each pageview on which we serve an ad.