Ad tech can be confusing. As we write our Kevel articles, we often discover contradictory definitions around the web, in part because most ad tech literature is written for advertisers and marketers. It can be confusing for someone on the sell-side (aka publishers) - for whom terms like “ad server” and “retargeting” can have widely different meanings.
This article aims to fix that by providing a resource catered for publishers to learn more about ad tech and relevant industry terms.
Table of Contents:
Ad tech stands for 'advertising technology’ and refers to using technology to buy and sell digital ads.
There are a two main reasons:
While no advertiser is exactly alike, they often have similar goals. After all, they are giving you money and expect something in return. Metrics they most care about are:
Advertisers generally buy in one of three ways:
Numbers 1 and 2 usually involve Insertion Orders, which are contracts that stipulate metrics such as length of the campaign (or "flight"), amount to be paid, how many clicks/impressions the advertiser gets, etc.
Number 3 usually offers a pay-as-you-go option with your credit card.
Larger brands will also usually buy through ad agencies, who will be the ones who decide where and how to buy. Large media agencies include names like Starcom, Carat, OMD, Mediacom, and many more.
The most common pricing methods are CPM, CPC, and CPA (see above).
From a publisher standpoint, CPM is the safest route and most common way that direct deals are sold. As you hopefully know how many impressions your site/app gets, you can be confident on being able to deliver a certain impression number over a certain amount of time.
Cost-per-click (CPC) is riskier for publishers, since it introduces an unknown factor: click-through-rates. If you show an advertiser's ads and nobody clicks on them, you make nothing. Many large ad platforms such as Google's AdWords employ this, though, because it appeals to long-tail performance-focused advertisers.
Cost-per-action (CPA) is less common, but loved by direct response advertisers. Here, advertisers pay only for some conversion event, such as a purchase or app download. This is even riskier for publishers, since not only are there CTR concerns, but you have to think about conversion rates too. Even if 100% of people click, if 0% of them convert, you make nothing.
With native advertising - it really is up to you! However, there are certain terms (native and non-native) that you may hear from advertisers more often, which you may or may not want to build into your platform.
For a breakdown of standard ad size units as defined by the IAB (Interactive Advertising Bureau), see here.
Targeting is important to ensure ad relevance and drive better performance metrics. There are many ways that ad platforms incorporate targeting. With Kevel, you can implement all of those listed below.
While we all know you aren't lying about the impressions and clicks you drove for your advertiser, THEY don't know it. So, they may ask to add special parameters to the click URL, or an impression pixel to the ad. This lets impartial third parties validate whether that impression or click did occur.
Kevel offers instructions on how to add these.
Ad Ops is the team that is setting up and managing campaigns. They often speak directly with the advertiser to determine when to start/pause, what to target, etc. Ad Ops can be very different based on what kind of publisher or company you are, how you sell your ads, and how big your team is. Some have multi-member ad-ops teams within their company, while others outsource ad operations, or have a sales team that also handles ad operations.
RTB (or real-time-bidding) refers to the automated buying and selling of ad inventory in real time.
In OpenRTB (what most people refer to with 'RTB'), a publisher sends an ad impression to a marketplace (as the ad is loading) and hundreds, even thousands, of advertisers bid for it auction-style. The company with the highest bid wins and appears on the page. All this happens in approximately 200ms.
In Private Marketplaces, there's the same flow above, but the advertisers are invite-only (therefore, generally only a handful of advertisers are bidding).
In Programmatic Direct, there's no auction, just guaranteed impressions for a given advertiser, but the buying/selling is done through a RTB platform.
Major players in this space include Rubicon, Index Exchange, Mopub (Twitter), Sharethrough, AppNexus, Google, PubMatic, Nexage, and OpenX.
In addition to the above terms, we’ve compiled this glossary and welcome your additions.