An ad network is a technology platform that serves as a broker between a group of publishers and a group of advertisers. For advertisers, they provide greater reach, efficiency, and targeting capabilities. For publishers, they provide a way to monetize their digital properties without having to directly negotiate with advertisers.
To really understand, let’s break it down.
A brief history
Ad networks were one of the first pieces of advertising technology that appeared in the mid-90s when online advertising first began. They were responsible for the very same things they are today—helping advertisers buy available ad space (aka inventory) across multiple publishers.
Anyone in digital marketing has heard of and probably used one. At the same time, the space is crowded and most say the same thing: “We have the best AI, we are Adtech, we have proprietary Machine Learning, we offer hyper-targeting, etc.”
How do ad networks work?
While you would expect the term “ad network” to include all sorts of media (printed media, television, radio), it is used exclusively to refer to online advertising.
At their core, they collect unsold ad inventory from multiple publishers and offer this pool of impressions to advertisers at a much lower price than a publisher’s direct sales. This kind of inventory is often referred to as non-premium, or remnant.
That trend has been changing over the past several years. More and more networks are taking a strategic approach and leaning towards offering their advertisers more exclusive deals with unsold premium inventory at premium prices.
These networks cherry-pick and pre-buy inventory from a number of top-tier publishers, and then resell it at premium prices. While this arrangement may be more expensive for the advertisers, it ensures premium placement of their ads.
What is the difference between an ad network and an ad server?
Because ad networks and ad servers were introduced to the industry at roughly the same time, it can be difficult to tell them apart.
An ad server is a basically piece of advertising technology—used by ad networks, publishers, advertisers, and ad agencies—to manage, run, and report on their advertising campaigns.
There are two types of ad servers:
- 1st-party ad servers (a publisher’s ad server); and
- 3rd-party ad servers (an advertiser’s ad server).
Ad servers are paramount to the success of an ad network’s campaigns. Data can sit on top of a campaign via these servers to reach a specific audience, on any device anywhere at any time. This technology can also sniff out what content the ads would be running and deflect the ads from any negative content. This ensures “brand safety.”
What are the different types of ad networks?
Ad networks aren’t a “one size fits all” marketing platform. It’s important you choose the right network platform to reach your KPI’s, whether it’s direct response, branding, device or content-focused.
There are 4 main ad network platforms that will cater to a brand’s specific KPI:
- Premium: Offer the inventory from popular publishers.
- Vertical: Topic-specific networks (business, technology, automotive, and fashion ad networks, etc.)
- Specialized or inventory-specific: (Mobile, Video, Native): Focuses on a certain type of inventory.
- Performance and affiliate: Typically using the revenue share, CPC, or CPA pricing model.
With traditional ad networks, an advertiser buys a “package” of impressions on a CPM basis.
What are the pros and cons of ad networks?
I mentioned the reach, efficiency, and targeting capabilities for advertisers and the ability for publishers to monetize digital properties, but there are drawbacks to consider:
- For Advertisers: Potential for ad fraud, less control over where ads are placed.
- For Publishers: Lower revenue share due to the commission taken by the ad network, potential for irrelevant or low-quality ads to be displayed.
Despite these potential drawbacks, the top ad networks not only provide your agency with inventory, but they reduce potential for fraud and help monitor and optimize your campaigns.
Final thoughts
Ad networks play a crucial role in the digital advertising ecosystem by simplifying and automating the complex process of buying and selling digital ad inventory.
If you are an agency or brand direct looking for fast and effective reach, a digital ad network should be part of your marketing mix.
Please reach out to our sales team for a meeting today
