Programmatic advertising has revolutionized the digital landscape since its evolution. Most of the burdensome tasks are now automated, which has gifted the industry with speed and scale. Numerous software and platforms work behind the scenes to serve quality ads in the right place, at the right time, and to the right person. It won’t be wrong here to say that it has helped your business make money while you sleep.
Among all these technologies, Ad Server has been one of the greatest things since sliced bread in the programmatic industry. It came into existence when digital advertising was taking baby steps and, since then, has supported the whole infrastructure as one of the strongest pillars. So, let’s dive into the details of this gray eminence – Ad Server.
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What Is an Ad Server?
An ad server is a software platform that helps publishers to create, sell, optimize, track, and manage ad inventories. It’s the decision layer that allows you to procure the maximum revenue while delivering the right ads to the user.
When you integrate an ad server into your website or app, they can set up rules to determine which ads are shown to users based on their location, browsing history, or device type. For example, if you are a publisher in New York, an ad server enables you to serve relevant ads to a user sitting in California just a week before the 4th of July and as per the device used.
Ad servers also allow publishers to track metrics such as ad impressions, clicks, and revenue, which can help them optimize their ad strategy and generate more revenue from their content. Furthermore, advertisers can use the ad servers to deliver ad creatives (requested by the publisher) and pull advanced reports and performance data for the live campaigns.
Insider Tip: Many ad networks and ad exchanges offer integrated ad servers as part of their suite of services.
How It All Started?
Well, in the beginning, everything was quite simple but slow. Advertisers would pay publishers directly to serve their ads on the website. The whole process used to be slow and inefficient. Then the publishers discovered that ads could be served dynamically if the ad sizes and spaces were standardized. That’s how the ‘ad servers’ (first-party servers as the publishers operated them) came into existence. The server would retrieve the correct images for the space. Publishers would add more page data and users in the request to the ad server. With the help of the ad server, both publishers and advertisers could collaborate and scale up advertising campaigns across the globe.
Technology has evolved a lot since its inception. Back in 1995, all they [ad servers] could do was serve ads based on the rudimentary target metrics or context*.
*Contextual targeting?
Contextual targeting places ads for a user based on,
– Language of the webpage,
– URL of the webpage,
– Browser type and version,
– Operating system, and
– Device.
However, today, ad servers can handle more than you can imagine. With the advent of machine learning and algorithm developments, ad servers can now schedule, sell, optimize, and measure every advertising campaign you see on the web.
Key Capabilities of an Ad Server for Publishers
Interested in learning what an ad server can do for you? Here’s what it has in store for you:
- Ad Creative Management: An ad server can efficiently manage, optimize, and traffic ad creatives to ensure they are displayed to the target audience.
- Ad Inventory Management: With the help of direct deals and/or ad networks, an ad server can help you sell your ad inventory to the right buyers, maximizing your revenue potential.
- Campaign Optimization: An ad server can optimize your ad campaigns to maximize revenue.
- Metrics Tracking and Reporting: An ad server can measure and report crucial metrics such as impressions, total revenue, and eCPM, allowing you to analyze the performance of your ad campaigns and make informed optimization decisions.
- Targeting and Frequency Capping: Ad servers offer advanced targeting and frequency capping options, enabling you to display ads to the right audience at the right time while avoiding overwhelming your users with too many ads.
Related read: Best Ad Servers For Publishers 2023
Types of Ad Servers
There are two types of Ad servers:
- First-party ad server and
- Third-party ad server
First-Party Ad Servers
Simply put, first-party ad servers are used by publishers to serve ads to readers. They are often paired with ad networks and SSPs to increase the yield.
How does a first-party ad server work?
- When a user visits the page, the browser will call the web server for the content.
- The server returns the content along with an ad tag.
- The ad tag will make the browser call the ad server.
- The ad server will select a suitable campaign based on the user’s info (gender, hobby, age, etc.).
- The line items matching the criteria are activated and allowed to compete for the impressions.
- At last, the winning ad is delivered to the user.
Third-party ad servers
Third-party ad servers are used by advertisers to deliver ad creatives and to measure the effectiveness of the campaign.
How does a third-party ad server work?
It works similarly to the first-party ad servers except for the final delivery stage.
- When a user visits the page, the browser will call the web server for the content.
- The server returns the content along with an ad tag.
- The ad tag will make the browser call the publisher’s ad server.
- The publisher’s ad server will select a suitable campaign based on the user info.
- The line items matching the criteria get activated and can compete for impressions.
- The winning line items return the ad creative URL (pointing to the advertiser’s ad server) back to the browser.
- The browser makes the final call to the advertiser’s ad server.
- The advertiser’s or third-party ad server delivers the ad creative to the user.
The third-party server counts an impression when the ad is delivered to the user. Typically, advertisers utilize a third-party ad server to track their KPIs.
What Are Hosted and Self-Hosted Ad Servers?
Hosted and self-hosted ad servers are two different ad server solutions you can choose based on your specific needs and preferences.
Hosted Ad Servers:
A hosted ad server is a server that a third-party provider hosts on their servers, and you can access it through a web-based interface. The provider typically manages all aspects of the server, including maintenance, upgrades, and support. Some popular examples of hosted ad servers include Google Ad Manager, Xandr, and Kevel.
Pros:
- Lower upfront costs: Hosted ad servers often have lower upfront costs than self-hosted options since there is no need to invest in hardware or IT support.
- Easy to set up: Hosted ad servers are generally easy to set up since the provider handles all the technical aspects, allowing publishers to focus on managing their ad campaigns.
- Regular updates and improvements: Providers of hosted ad servers typically release regular updates and improvements to the platform, ensuring publishers have access to the latest features and capabilities.
- Reliable support: Hosted ad servers typically offer reliable customer support, helping in case of technical issues or questions.
Cons:
- Ongoing fees: Hosted ad servers often come with ongoing fees that can add up over time and become a significant expense for publishers.
- Limited customization: Hosted ad servers may offer limited customization options since the provider manages the server’s infrastructure and configuration.
- Control: Hosted ad servers give less control to publishers over their data and the ad-serving process.
Self-Hosted Ad Servers:
A self-hosted ad server is an ad server hosted by the publisher on their own servers, either on-premises or in the cloud. You are responsible for managing all aspects of the server, including maintenance, upgrades, and support. Revive is a self-hosted ad server.
Pros:
- Greater customization: Self-hosted ad servers offer greater customization options since the publisher fully controls the server’s infrastructure and configuration.
- One-time cost: Self-hosted ad servers typically require one-time hardware, and IT support investment, making them more cost-effective in the long run.
- Full control: Self-hosted ad servers give publishers complete control over their ad campaigns, data, and infrastructure.
Cons:
- Higher upfront costs: Self-hosted ad servers require a significant upfront investment in hardware, and IT support, making them initially more expensive to set up.
- Technical expertise required: Self-hosted ad servers require technical expertise to set up and manage, which may require additional resources or training.
- Updates and improvements: Publishers are responsible for keeping their self-hosted ad server up-to-date with regular updates and improvements, which may require additional resources.
The Road Ahead
The advent of ad servers in the late 1990s revolutionized how publishers delivered ads to their target audience. Today, ad servers have become a comprehensive platform for managing, optimizing, and analyzing ad campaigns. As the digital advertising industry has grown and evolved, so have the capabilities of ad servers, enabling publishers to increase their revenue and improve the user experience.
The recent development of header bidding has further revolutionized ad-serving technology, providing publishers with greater transparency, control, and revenue potential. With header bidding, publishers can access more demand sources, receive real-time bids, and increase the value of their ad inventory.
Overall, ad servers have played a crucial role in the evolution of digital advertising, and publishers who embrace this technology stand to benefit from greater efficiency, revenue, and control over their ad inventory. As the industry continues to evolve, it will be interesting to see how ad servers and related technologies continue to innovate and shape the future of digital advertising.
FAQs
Q1. What does an ad server do?
An ad server is a technology platform that enables publishers, advertisers, and ad agencies to manage and display digital advertising campaigns.
Q2. What are the best ad servers for publishers?
Popular ad servers for publishers include Google Ad Manager, Adzerk, OpenX, AppNexus, and Smart AdServer.
Q3. What are third-party ad servers?
Third-party ad servers are owned and operated by third-party companies, providing advanced targeting, reporting, and tracking capabilities for advertisers and agencies to run digital ad campaigns across various publishers’ websites and mobile apps.
Q4. Why do publishers need an ad server?
Publishers need an ad server to manage their digital ad inventory, deliver ads, optimize ad delivery, track performance, generate revenue, and control the ads displayed on their websites.
