Ad Server Essentials: How Do They Work and How To Choose the Right One?

Industry InsightsAd Server Essentials: How Do They Work and How To Choose the Right One?
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    With the rise of digital advertising, the demand for more technologies to run, manage and maintain ad campaigns has always been high. Brands, publishers, and advertisers always need a solution that would make it easier to display the right advertisements to the right audience without the need to control every step manually, so the media buying/selling process could be automated and profitable. Though ad serving is not something new, the system has evolved and now there are plenty of servers offering publishers and advertisers the best tools for targeting, management of inventory and campaigns optimization, as well as collecting tons of data to adjust advertising campaigns to customers’ needs to deliver creatives that will make them interact. Today we’ll talk about ad servers.

    What is an ad server?

    An ad server is a system used in programmatic advertising that hosts, optimizes, and publishes ads on various websites and apps. It’s a kind of huge storage where tons of ad creatives are stored waiting for the best opportunity to be displayed for the proper viewer at the proper time. Ad servers use a great amount of data to implement ad serving as well as allow marketers to perform management, tracking, reporting, and more. 

    What is ad serving?

    Ad servers probably can’t work as they do without ad serving technology – the very thing that places ads on multiple resources. We may say that this is the heart of an ad server that does hard analytical and decision-making work using specific algorithms to serve relevant ads to the right audience. The way slots are selected is predetermined by the regulations that publishers and advertisers set. Among them are such criteria as targeting, frequency, format, revenue opportunities, and other details.

    How ad serving works: types of servers

    There are multiple ad servers for different needs, with different parameters, and we can divide them into several groups.

    • For publishers and advertisers

    Ad servers work both from the sell-side and buy-side. Though the technology is actually the same, the purposes are different. Ad servers for publishers are also known as first-party platforms, and they make it easy to control the ad inventory including placements management, ads delivery optimization, and statistics collection. An advertiser ad server is a platform of a third party and is used to understand how a campaign performs and to make necessary changes and adjustments for better results and higher profit.

    • Self- and managed-serve

    Self-serve ad servers are distinguished by more comprehensive functionality and are used by their owners who can implement the necessary customization at their discretion. Such technology will be a solution if you can manage everything on your own or have staff that can cope with all the tasks in terms of technical issues, maintenance, and monitoring. Managed ad servers are used by third-party providers who will do all the work for you. In this case, you save much time and money but get less control over the optimization of your campaigns. 

    • Local and remote

    Local ad servers are the ones owned, managed, and optimized by publishers. Remote servers are independent with no direct access from the publishers’ side. Using remote ad servers, advertisers can track the way ads are placed on the web and get the necessary data for further campaign optimization.

    What is the role of ad server platforms?

    The ad-serving platform has diverse functionality but the functions it provides depend on the purposes it is used for. Though the general role of the server is to make every campaign relevant and efficient, publishers and advertisers use them in different ways.

    How do first-party servers work?

    A publisher ad server allows them to implement management of inventory and sell ads to advertisers by means of direct campaigns. In case direct campaigns are not available, a first-party advertising server will help publishers make the decision concerning what ads will fit this or that slot. Such ad servers imply a full-fledged advertising tool and decide what creatives will be displayed based on targeting criteria. They pick up ads for display, serve them, and provide reports including impressions, CTR data, etc.

    The scheme of first-party ad server work is as follows:

    1. A user visits a website, and a browser requests certain content from the server
    2. The first-party ad server sends back the HTML and renders the content of the page
    3. Then it selects an ad slot according to the request
    4. Using targeting data, the ad server picks up the proper campaign and sends the JavaScript code back to the website
    5. The chosen ads are served on the site 

    First-party domain requests and cookies are rarely blocked by ad blockers which makes advertising more efficient and provides more traffic opportunities. Moreover, first-party servers gather data based on a user’s needs, so the relevancy of displayed content would be as precise as possible, especially taking into account the fact that cookies may become a thing of the past. 

    How do third-party servers work?

    Third-party ad servers are used by advertisers who do not have direct access to them. In order to display ads on sites and within the apps, advertisers just use the tag of an ad that is generated when ads are uploaded to the server. Still, third-party servers also give the opportunity to optimize and manage a campaign as well as generate reports on its performance. But the functionality of advertisers’ ad servers is not limited to the features mentioned above, and they are also used for A/B testing, ad viewability analysis, and user journey tracking based on how users interact with an ad and what clicks they make.

    Third-party ad servers work according to the following scheme:

    1. When a user opens a website, the request for certain page content is sent to the server
    2. The publisher-side ad server sends the HTML and conducts page content rendering
    3. Then the server gets a request to choose an ad slot and selects the best fitting campaign according to targeting data
    4. The first-party ad server sends the third-party ad tag (the code of a slot) to the site
    5. This tag sends a request to the third-party platform which returns the proper inventory to the first-party site
    6. The ad is visible on the site

    Ad serving technology: what are the functions of the third and first-party servers?

    Among the functions of a first-party ad server are:

    • targeting and decision-making in terms of ad serving
    • data reporting including such criteria as clicks, impressions, etc
    • slot forecasting (what inventory publishers will sell taking into account ongoing ad campaigns)

    Third-party ad servers are used in the following ways:

    • ad storage and management 
    • campaign optimization 
    • conduct A/B and other types of creatives testing
    • collect data about all publishers’ and platforms’ campaigns
    • measurement and verification to understand how ads are delivered and viewed
    • compare data with publishers’ reports

    How to choose an ad server?

    Before you choose a certain ad server you need to define what goals to pursue. Both first- and third-party platforms involve the same technology. The difference lies in the purposes they are used for – to satisfy the needs either of the demand-side or the supply-side. 

    For instance, if you don’t know whether you need a self-serve server or a hosted one, estimate your resources first. If you have enough expertise or there are employees in your company who know the technology, it is better to choose a self-hosted ad server. You will be able to take full control over the ad serving and save on expenses as a bonus. But if you lack the necessary knowledge and experience and there are no ad serving professionals in your team, you better entrust all the work to a third party, i.e. use a managed ad server. 

    When publishers choose a server, they want to be able to control it at every stage. So they should pay attention to the access available to slots, targeting, available ad formats as well as tools that provide an efficient display. A first-party server should make it easy to measure campaign performance in order to be able to customize it for better results in the future. In turn, advertisers seek an ad server that would give them valuable insights on how a campaign is performing and help track the impressions of every element of the ad to maximize revenue.

    When choosing an ad server, marketers can pay attention to such metrics as eCPM (effective cost per mile), in other words – the cost for every thousand impressions. Knowing this metric, a publisher can predict how much revenue this or that ad may bring. Apart from that, every ad server has its SDK (software development kit) which is used for ad display, campaign management, and performance tracking according to a range of key metrics. Before choosing a certain ad server, you can do a little research to find out which servers have the best SDK.

    Examples of ad servers for publishers and advertisers

    There are plenty of ad servers available. In order for you to pick the one that will meet your requirements, we have created a small compilation of ad servers for advertisers and publishers. Check them out and choose the best one for your needs.

    OpenX

    OpenX is one of the most popular ad servers for advertisers allowing them to work with direct campaigns or use premade programmatic tools. It provides such features as microtargeting, optimization in automatic mode, and real-time analytics. There is also the possibility to access data gathered from the previous 12 months and to sell any ad spaces that weren’t sold through the OpenX AdExchange.

    Xandr

    It’s a former AppNexus, and now is one of the most powerful AdTech companies in the industry. It offers an in-built ad server and a marketplace, which is equipped with a SSP as well as having support for various formats including interactive video creatives that could be delivered to any screen size. This ad server will become an excellent solution especially for premium publishers who deal with millions of impressions monthly since Xandr offers lots of features top media publishers will definitely appreciate.    

    Campaign Manager 360

    This is a demand-side platform that serves ads in different dimensions across various devices. It provides advertisers with the following features: a user-friendly interface, fraud protection, trafficking, reporting, and double-click verification. With DCM, advertisers can launch new campaigns in a matter of clicks and implement real-time updates.

    Google Ad Manager

    With this ad server, publishers will be able to easily manage their campaigns leveraging multiple programmatic tools to display ads across various devices and get fast reports. The ad server provides powerful analytics and is integrated with Google’s ad network and AdSense to make it easy for beginners in advertising to get the most out of their advertising experience.

    Kevel

    Kevel is a white-label company that helps publishers build a custom ad server with minimum time and effort. With the help of its APIs targeting of ads, their serving and reporting become easy for everyone. Among the key benefits of the ad server are fast response (less than 30 minutes), no use of JS tags or cookies, full control over the front end, and pricing with no revenue share. With Kevel there is no need to hire more professionals to help you build an ad server as you can add any features yourself making all manual tasks automated. Moreover, the APIs will help you avoid problems with ad blockers.

    Broadstreet

    This ad server will suit those users who are not tech-savvy. It is distinguished by an intuitive user interface, integration with WordPress, and technical support that quickly processes requests to help users use the ad server to its fullest. This type of ad server will fit digital magazines and news sites interested in direct sales (not programmatic approach) as well as anyone who is looking for an ad platform that will be easy to use and manage. 

    Smart AD Server

    This is an ad server for publishers allowing them to execute direct or programmatic campaigns across all formats and various sizes of screen. Thanks to the unified action feature, publishers can get maximum profit from ad impressions. Moreover, they can enjoy a wide range of features among which are cross-platform trafficking, detailed reports, comprehensive targeting, and forecasting in real-time.

    Magnite

    It is the biggest independent sell-side advertising platform that helps connect 60k+ publishers with 900k+ premium advertisers via a self-hosted ad server. With a user-friendly interface, it is easy for publishers to manage ads with access to Automated Ad Pods, Real-Time Insights, and everything they need to succeed – from tech tools to fraud protection and support. Magnite makes it easy for publishers to sell their inventory covering all channels and formats as well as helps agencies deliver relevant ads to millions of customers complying with all privacy requirements. 

    Sizmek

    Sizmek is a third-party ad server offering many tools and features for effective advertising across multiple channels. It offers advertisers full control over their campaigns, automatic optimization features, an HTML5 Ad Builder, real-time analytical tools, and helpful support available round the clock.

    Conclusion

    An ad server is a must-use technology for publishers who want to maximize their profits and take control of media planning, targeting, trafficking, optimization, and reporting. In addition, it is also for advertisers who want to learn the ins and outs of their campaign performance. The question is not whether you need an ad server or not, the question is what kind of an ad server you need to make every invested dollar pay off and raise the efficiency of your marketing efforts. Fortunately, there is a wide range of solutions both publishers and advertisers may leverage to run efficient advertising campaigns and optimize them to get the desired results. Define your needs, estimate your resources and pick an ad server that fits you best.