Advertising is one of the most common ways for publishers to earn money, in part because it offers so many options for diversifying your revenue. But it can be a challenge to understand the different types of ads, how each one works, and where it fits into your overall monetization strategy.
That’s especially true when it comes to programmatic advertising, which comes with its own “alphabet soup” of terms and acronyms. Today we’re going to dig into one of the less well-known aspects of programmatic: ad servers. We touched on ad servers in our programmatic glossary for publishers, but there’s a lot more to learn than just a simple definition.
First things first: What is an ad server?
An ad server is a web-based technology that stores, maintains, and serves advertisements to website visitors when a page is loaded. Ad servers are typically platforms that are dedicated to the deployment of digital ads to the end user.
Simply put, ad servers help publishers and content creators efficiently manage the ad space on their site. They can also help advertisers manage the creative that will be shown on publisher websites.
- Publisher-focused ad servers are often called supply side platforms (SSPs).
- Advertiser-focused ad servers are often called demand side platforms (DSPs).
In general, when a reader goes to a website page that contains ads, information about that individual is sent to auction. Advertisers then make bids to show an ad to that reader, and the highest bid wins. The winning bidder serves their specific creative or advertisement on the publisher’s site. All of this happens automatically, behind the scenes.
More on supply side platforms (SSPs)
An SSP is a platform that allows publishers to automate the sale of their ad inventory. SSPs give content creators the ability to set up ad tags based on their website layout. Once those ad tags are created, they place the ad tags on their site.
Ads are then shown through the ad tag and the publisher is paid based on the number of times that the ad is shown to a reader. Each ad view is called an impression.
SSPs often operate on a revenue share basis. A revenue share of 15-20% is common – so for every $1 earned by the publisher, the SSP would take $0.15 or $0.20 off the top.
More on demand side platforms (DSPs)
DSPs give advertisers the ability to control the actual advertisements that they want to run at scale. A DSP allows the advertiser to identify the best ad inventory for reaching a target audience, automatically place bids, and gain insights into ad performance.
Advertisements (or “creative”) are uploaded to the DSP by a marketer or an advertiser. The marketer or advertiser then sets parameters so the creative is only shown to specific readers. For example, UK-based creative would only be shown to UK readers; an athletic apparel ad would only be shown to fitness enthusiasts.
The advertiser is then able to report on the number of times their ads were served to a user. These reports can be leveraged to understand the effectiveness of the individual ad or campaign.
How DSPs and SSPs work together
DSPs and SSPs depend on each other to function. DSPs provide the advertisements and the overall ad spend, while SSPs provide the “real estate” for ads to appear. DSPs and SSPs can connect through a virtual marketplace called an ad exchange, where they conduct automated transactions to buy and sell ad space.
A few of the major players in the DSP spaces are The Trade Desk, Google, Amazon, BidSwitch, DoubleClick, and LiveRamp. Major SSPs include Google, OpenX, Amazon, SpotX, Magnite, and Rubicon.
Managing DSPs, SSPs, and more
If all of this seems a little confusing, you’re not alone. Digital advertising is complex, and it changes constantly. In fact, there’s a whole segment of ad management – called ad operations or “ad ops” – that’s dedicated to managing DSPs, SSPs, data management platforms (DMPs), ad exchanges, private marketplaces (PMPs), and more.
The ultimate goal of ad ops is to drive higher ad revenue, but it requires constant attention, testing, and experimentation. Small and mid-sized publishers often miss out on valuable revenue opportunities because they lack the time, resources, or expertise to optimize their ad ops.
Disclosure: What’s New in Publishing is wholly owned by Sovrn Holdings, Inc.