Ad servers have revolutionized programmatic marketing, making it easier to monetize ad inventory effectively. To achieve seamless cooperation between companies and brands it is essential to clarify the need for solid ad server software to increase the effectiveness of their marketing and earnings efforts. Ad servers are beneficial to both sides.
Advertisers reach their intended audience more efficiently by enhancing their marketing, and publishers can easily generate income by displaying ads. It’s a win-win scenario for all parties involved in the digital advertisement process. According to research, the global ad server’s market size was about $2.3 billion as of 2021. But by 2025, this number is predicted to increase to $4.8 billion!
Are you eager to start studying the development of software for ad servers? This blog focuses on various aspects, including what exactly an ad-serving system, how it operates with different advertising servers.
What is an Ad Server?
Ad servers are technology-enabled tools that act as decision-makers in online advertising transactions. For instance, they select the best ads to display on the publisher’s platform, provide advertisers with performance reports, and allow for real-time campaign improvements. This vital AdTech component streamlines campaign management, optimizes ads across platforms, and fosters an environment for achieving advertising goals effectively..
Top ad-serving technology lets advertisers upload campaigns, set audience targeting, demographics, budgets, and achieve specific results effectively.
Building an ad server platform helps publishers match suitable ads, track traffic, manage inventory, target audiences, and meet objectives.
What are the Different Types of Ad Servers?
Ad servers are classified according to the organizations that utilize them, namely first-party and third-party ad servers. Each has its unique advantages and distinctive capabilities.
First-party Ad Server (Publisher or Sell-side)
Publishers who own apps, websites, or any other digital platforms use this advertising-serving technology to manage and serve advertisements on their digital properties.
Ad servers manage ad display, pricing, and offer robust features like data storage and reporting to support better decision-making..
Third-party Ad Server (Advertiser-side)
Advertisers use this ad-server software to connect with multiple publishing platforms.Ad servers help agencies manage campaigns efficiently, coordinating, dispersing, and optimizing ads across formats like images, videos, and CTV advertising. They also let advertisers concentrate on particular audiences and track the performance of their campaigns.
How Does an Ad Server Work?
The introduction of ad server systems in the 1990s revolutionized the way that advertising was done. This tool enabled corporations and brands to control and manage their ad display without altering their website’s backend. In 1995, FocaLink Media Services introduced an ad server that simplified managing ad performance and ads. In the years since, ad servers have adapted to new features, such as the ability to target and manage budgets. They then developed into first and third-tier ad servers providing customized solutions to manage ads effectively. In the present Ad server software is now a crucial part of achieving online advertising objectives in the ever-changing landscape of the passing of time.
In this section, we’ll examine the way that first-tier and third-tier advertising servers function:
How Does First-Party Ad Server Work?
First-party ad-serving technology operates within the framework of the publisher’s digital platform and serves as a control center for display ads. Here is a complete advertisement operation process performed by the ad server for publishers:
Ad Placement Tags: imagine that you’re a professional painter. Think of your digital app or website as a canvas for a publishing company. Ad placement tags provide guidelines that help you choose which areas you want to paint. The tags, i.e., code snippets, indicate where ads will be displayed.
Sending an ad request: When a user browses or interacts with the publisher’s platform, it’s almost like they’re knocking on the doors of the Ad Server. This knock is an advertisement request, which asks for an advertisement to be displayed in a certain place for the ad. It’s the trigger that puts the process of serving ads in motion.
Targeting and Ad Selection: The first ad server is a skilled archer, using its capabilities to choose the most relevant ads among the available inventory. It considers factors like the demographics of the user’s profile, their behaviors, and the content on the page or application. Each advertisement is an Arrow aiming to strike the user’s interest target.
Ad Serving: After an ad server chooses the best creative for an ad, it will deliver it in real-time to the appropriate ad location on the web page or inside the application.
Tracking and reporting: Ad servers doesn’t only serve ads but also forget about them. It tracks various indicators like impressions, clicks, as well as conversions. These data provide valuable information to the advertiser on the effectiveness of their ads.
How Does Third-Party Ad Server Work?
As we’ve mentioned, they operate from the advertiser’s perspective and differ from the ad servers used by publishers. Let’s learn how a third-party advertising server functions:
Advertorial Campaigns Setup: To ensure the success of an ad campaign, having the right campaign parameters in place will pave the way to better results. Advertisers define their campaign parameters through Third-Party Ad Servers, establish the budget, and then create their own ad assets. Ad assets can be everything from banner ads to videos.
The Ad Tag Generator: After the campaign is in place, the advertiser’s ad server generates a distinct ad tag for each creative ad or campaign. We could think of it as a different digital footprint for every advertisement.
Ad Network Integration: This step lets third-party companies integrate ad tags with various ad networks or exchanges. This enables the ad exchange to go one step further by asking for ads for creatives when the right places become available.
Auctions and selections: Bidding that is real-time in an ad exchange takes place using key parameters like pricing, targeting, and bid prices. When the top advertiser wins the competition, ad exchanges request ad creatives from the advertiser’s server.
Delivery and Display Ads: The Ad Server of the Advertiser completes the request for ad exchange by delivering the ad’s creative, and then serving an ad on the platform used by the publisher.
Benefits of Ad Server in Programmatic Advertising
Ad servers have developed into tools similar to smartphones for companies and agencies. They’re not just tag transporters but essential tools that boost ad efficiency and ROI and offer an overall analysis of marketing efforts. Today, ad servers act as the command center for advertisers, using data to deliver personalized ads, measure performance instantly, and optimize automatically.
A good ad server will transform regular digital advertisements to direct value for business and help grow brands. Let’s look at the advantages of developing platforms for ad servers for programmatic advertisements.
Benefits for Publishers
Direct Ad Sales and the Management of Inventory: Ad servers allow publishers to sell directly and manage their inventory of ads. With the right control, publishers can efficiently manage their ad placements, establish prices for advertising space, and gain insight into the advertising space available to aid in decision-making.
Audience Segmentation and Behavioral Targeting: The ad server functions as a web server that collects, stores, and retrieves information. As an information broadcaster the technology of ad servers allows advertisers to gather insights into the behavior of their website visitors. Based on data like browsing habits, interests, and demographics, creating audience segments is easier for marketers. This enables advertisers to create targeted advertisements and generate more value from each place.
Advertising Network Ad Network and Exchange Integrations: By taking advantage of the capabilities of Ad Servers, publishers can connect to the marketplace using various advertisers and demand-side platforms (DSP) that result in higher rates of ad placement.
First-Party Data activation: Advertisers can utilize their first-party information like user registration or consumption patterns inside their advertising server. This allows for better audience targeting and creates personalized advertising experiences.
Benefits for Advertisers
Multi-Channel Campaign Management: Ad servers allow advertising agencies to optimize and manage campaigns across multiple channels, such as display, video, mobile, and social media, from one platform.
Remarketing and Audience Retargeting: Real-time retargeting and remarketing improve the efficiency of campaigns. Ad servers enable advertisers to target and remarket their ads to users based on their campaign performance directly affecting the relevancy of advertisements, conversion rates, and overall effectiveness of the campaign.
A/B testing: The Ad Servers for Creative Optimization, A/B testing, and Testing help creative optimization, allowing advertisers to experiment with different creatives, formats, and messages across various audiences. This process will enable advertisers to separate the most efficient creative assets and messages.
Accreditation and Tracking Conversion: It gives you granular attribution and tracking of conversions that allow users to understand the effects of their marketing campaigns on desired outcomes like website visits or lead generation sales.
Data Integration: Adverts who integrate their audience data may incorporate data from first-party sources or utilize third-party data sources within the Ad Server platform. With this integration, advertisers can achieve more accurate audience targeting and more personalized ads. Better performance and campaign relevancy are inextricably linked.
Ad servers are essential tools that streamline programmatic advertising, benefiting both advertisers and publishers. They enable precise targeting, effective campaign management, and increased revenue opportunities. As the ad server market continues to grow, adopting this technology is crucial for achieving advertising goals and staying competitive in the evolving digital landscape.