Why Do We Need Ad Exchange? 3 Most Popular Types of Ad Exchange

Ad Exchange is technology enabled market place where advertisers and publishers exchange their ad inventories. The publishers and advertisers are using separate platforms to connect through ad exchange in a real-time.

Why Do We Need Ad Exchange?

Let’s look why publishers and advertisers need ad exchange and how it is beneficial to them in the digital advertising today.

For Publishers:

Curate the ads and pick the buyers: Ad Exchange allows publishers to pick the buyer they wanted to serve the ads independently. Also, the ad exchange allows the publishers to select the types of ads that they wanted to display on their web pages. It provides control over restricting the buyers to display ads on publisher pages.

Maximize the revenue: The ad exchanges help the publisher to choose the highest bidding advertisers to display their ads on the web page. It will guarantee that the publisher will be paid highest revenue to their inventory at all the time. Additionally, floor price ensures that the publishers will be paid more than the set price.

Select the Ad Slot and Increase engagement: Ad exchange provides the flexibility and customization abilities to the publishers to control the ad serving activities. The publisher can decide where exactly ads can be served on the web pages and engage with their audience effectively.

For Advertisers:

Enormous pool of impressions: Ad exchanges provide the various of options of inventories to choose while planning the ad campaigns to an advertiser. The ad exchanges will help the advertisers to effectively purchase inventory and optimally spend their ad budget. The advertisers can setup a deal with a specific publisher though ad exchange if they wanted to serve an ad on specific website.  

Greater independence over ad placement: When advertiser use an ad exchange compared to ad network, they will get more options in decision making on where to display their ads. Advertiser can setup their campaigns and manage entire activities using ad exchange platforms.

Maximum ad optimization: Advertisers can use multiple strategies of user targeting ex: geographic targeting, behavioral targeting, inventory targeting, dayparting, device and cross-platform ad targeting to ensure maximum user engagement of their ad campaigns.

Here’s an article to understand What is Ad Exchange? How Does Ad Exchange Works?

3 Most Popular Types of Ad Exchange

Ad exchange platform is evolving the with technology and there isn’t one of type of ad exchange that exists to cater both the advertisers and publishers. To narrow down, there are three most popular types of ad exchanges available in the market.

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Open Ad Exchange: As the name says, an open ad exchange is a virtual marketplace where it connects multiple publishers and advertisers. However, the advertisers will get limited information about the publishers compared to private marketplace. The primary benefit of open ad exchange is choosing the inventory from various publishers.

There are approximately 70 billion impressions flowing in per day through open ad exchanges. The publishers have access to a larger pool of buyers at all the time. The concern with open marketplace is the aspect of security. Most of the buyers will opt out open ad exchange due to increasing ad frauds.

Private Ad Exchange: This is a closed ad exchange where publishers and advertisers will be invited to bidding the inventories. The publishers can decide which advertiser can place the bid, price of the bid, with what type of targeting restrictions. The publisher has complete control considering each private ad exchange runs with invited advertisers. The publisher also has a power to block the ad network and can restrict other buyers accessing the set of impressions.

The advertisers will get premium quality of the inventory through private ad exchange compared to open marketplaces. The private ad exchanges are popular model within the ad exchange to get maximum control and transparency to the buyers.

Preferred Deal: This is a unique feature of ad exchange where it allows publishers to allow desired advertisers to place a bid in the closed marketplace before falling into other two types. The publishers usually have deal with desired advertisers with fixed price to bid for their inventory. It provides maximum visibility to the advertisers on where their ads are serving.

Conclusion: Ad Exchange is an integral part of digital marketing where it connects the advertisers and publishers in a real-time. The benefits of using ad exchanges and the types of ad exchanges create a unique value to both the advertisers and publishers to manage their ad campaigns and inventories effectively.

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