TLDR

The primary function of advertising networks is to aggregate inventory from multiple publishers...

Do you understand the distinction between an ad network and an ad exchange? If not, you're in for a surprise! It's easy to mix up Ad Networks and Ad Exchanges, but they're not the same thing. The primary function of advertising networks is to aggregate inventory from multiple publishers, mark it up, and profitably sell it to advertisers. Because they allow advertisers to see the exact price at which publishers' impressions are sold, ad exchanges are more transparent than ad networks.

In this post, we'll look at the differences between these two platforms and explain why ad exchanges are quickly becoming the preferred platform for publishers. Keep an eye out!

What exactly is an ad exchange?

Consider Ad Exchange to be an online marketplace where publishers and advertisers can buy and sell advertising space. Ad exchanges collect a large pool of inventory from multiple ad networks, SSPs, and publishers, which is then presented to DSPs, media buyers, ad networks, and brands to buy impressions in real time. The video, display, mobile, and in-app ad inventories are listed under impressions.

Publishers can get started with ad exchanges by contacting one or signing up directly. Publishers join this pool to maximize profits from inventory by tapping into global demand. Publishers can control their entire inventory through ad exchanges in this case. They can set and adjust floor prices, create targeting criteria, add or remove demand, and so on. Ad Exchanges are primarily geared toward enterprise-level publishers with high traffic and revenue requirements. In such cases, ad networks and SSPs can assist small and medium-sized publishers in gaining access to them. In a nutshell, ad exchanges are a quick and easy way to buy and sell ad inventory.

Publisher Advantages of Ad Exchanges

Publishers can use ad exchanges to get the best price for their ad inventory, and advertisers can target the right audience at the right time.

  • Publishers can set a minimum CPM for ad units, as well as block ads with sensitive ads or competitors' content.
  • Set the types of ads that will appear on the web page by choosing from a variety of ad formats and styles. They can also select ad placement and location.
  • Combine different corner styles, fonts, and colors and apply them to various display ads at the same time.

What exactly are Ad Networks?

By aggregating ad inventory supply from publishers and matching that supply with buyer demand, an online ad network acts as an intermediary between buyers and sellers of ad inventory. Advertisers can target specific audiences because inventory is typically segmented into categories such as gender, location, and age.

How do Ad Networks function?

Unsold inventory from publishers is collected by advertising networks and sold to advertisers. Ad networks make money by taking a percentage of the publisher's ad revenue after real-time bidding has sold inventory. Ads appear on publisher's websites via a highly automated process in which the website invokes an ad request by incorporating code that calls the central advertisement server, which serves the ad.

Following that, a hidden tracking javascript pixel monitors the performance of the ad. Ad networks can be a dependable and simple way for publishers to sell unsold inventory to online publishers, though they typically do not generate as much revenue as direct sales. However, for advertisers, ad networks are a cost-effective way to reach out to potential customers all over the world.

What is the distinction between advertising networks and advertising exchanges?

Ad Exchanges

  • Its automated technology platform boosts ad buying and selling efficiency.
  • Publishers can sell their remnant ad inventory transparently using ad exchanges. Publishers have more say over what is defined.
  • Policies and procedures for purchasing and selling advertisements.
  • Ad impressions are sold on an impression-by-impression basis through real-time bidding (RTB) auctions.
  • Ad impression prices fluctuate depending on how much advertisers are willing to pay for ad inventory.
  • There is no involvement of a third party.
  • Transactions between advertisers and publishers take place on the open-marketplace technology platform of ad exchanges.
  • Publishers have control over which advertisers bid on their ad inventory.
  • Publishers can easily customize performance reports that are generated automatically.

Ad Networks

  • People own and run advertising networks.
  • Streamlines the ad buying and selling process between publishers and advertisers.
  • Advertisers are connected to premium ad inventory sources from industry-leading publishers.
  • Some ad networks do provide advertisers with an automated ad-buying experience, but this is not the same as the impression-by-impression automated bidding and targeting systems seen in programmatic media buying.
  • Ad Impressions are bundled together and sold to advertisers as packages. After the negotiations are completed, the prices remain stable.
  • Publishers have no say over who buys their ads.
  • Reporting is managed by teams rather than being automated.
  • Only certain publisher websites that meet the requirements and apply for membership will be accepted into the ad network.
  • Publishers can get the best prices on both premium and remnant ad inventory.

Despite their similarities, ad networks and ad exchanges operate differently, even if they appear to be the same at first. Ad exchanges, unlike ad networks, only use real-time bidding, so pricing is always competition led and the highest bidder gets the ad inventory.

Inventory is purchased more transparently in an ad exchange because advertisers specify various parameters for where and to whom ads should appear, implying that they are generally more willing to pay more for these impressions. Ad exchanges enable advertisers and publishers to directly discuss the type of ad inventory they are trading.

Ad networks, on the other hand, offer exclusive, pre-segmented inventory at higher rates to a specific audience. Ad networks have been deemed less transparent because advertisers have no idea which websites their ads may appear on, and publishers have no idea who purchased their ad inventory.

Despite the fact that ad networks made selling and buying ad inventory more efficient, ad exchanges can be thought of as ad networks on steroids.

Final Thoughts

So, what's the bottom line? If you want to avoid a drop in ad revenue, it might be time to consider switching to an ad exchange. Not only will you receive a higher value for your inventory and more relevant ads for your users.

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