Also known as a closed auction, an invitation-only auction is where the publisher/seller only invites selected advertisers/buyers to bid on their available (usually premium) inventory via a private marketplace.
Publishers often negotiate deals with selected advertisers in advance, agreeing terms such as maximum CPM and ad unit types. This agreement is then assigned a ‘deal ID’. The publisher makes their inventory available via an invitation-only auction on a private marketplace, and if it matches the criteria agreed under this deal ID, a bid request is triggered inviting relevant buyers to bid.
The deal ID ensures that both parties can identify each other as trusted partners – publishers know who is buying their inventory, advertisers have more control over ad placement, and both have more control over deal terms.
See also Private Marketplace.