An ad server is a piece of software that helps you with ad management, ad targeting and campaign reports. It's responsible for deciding which ad to show to which visitor. Common examples of ad servers are Google Ad Manager, OpenX and AdGlare.
I remember it well. It was back in the year 1996 when I was updating the URLs of banner ads on my web pages, right at midnight. A stressful situation, as one of my advertisers booked a section of my blog for that new day. Sounds familiar to you? Now that day has long gone, after the birth of the ad server.
So what is the essence of an ad server? In a single word: automation.
A third-party ad server is commonly used by publishers to manage direct deals and ad exchanges within one place, increasing productivity and sales. Companies that provide ad serving technology may focus on a specific part of the industry, e.g. advertisers and publishers.
Although the underlying ad server basics remain merely the same, it might be difficult to choose a vendor. Here's what the landscape looks like:
Ad serving engines take care of trafficking the creative to a web page or app. They are usually physically distributed around the globe to allow for high-performance ad serving with the lowest latency. It also allows advertisers to target a subset of users in an automated way, showing different ads to different visitors. Think about geographical location, device/OS technology and behavorial data.
Not every publisher needs an ad server. A part of your site's inventory can be dedicated to a specific ad exchange or advertiser. For example, the Sports section can be sold exclusively to Nike, and the Health section sold via an ad exchange. In this case, ad management platform may not be needed.
However, things may be different when your website starts to grow or when you're dealing with multiple advertisers or exchanges. If you wish to target ads to specific sections and generate ad reports independently, you may need a third-party ad server. Without one, you'll also be flying blind when it comes to yield optimization. How can you make sure that each section you're monetizing is earning you the most amount of money? An ad server can be configured to do just that.
There are different kind of ad serving companies, each providing ad server software in their own niche. You can either get it for free as an open source project, or you can buy it as a SaaS platform at a monthly fee. Ad server costs start around $0.002 CPM (the price for serving 1000 ads). For plans & pricing, see this complete Top 10 Ad Server List.
Contextual Advertising is considered to grow this year, largely due to Europe's GDPR that came into force early 2018. Publishers are required to request visitor's consent in order to track or process personal data. With visitors unlikely to provide consent, advertisers may have to shift to contextual targeting to fine-tune delivery of display ads based on interest. For those who think they'll be OK by targeting outside Europe: some US states may introduce a similar privacy law.
The Video Advertising market will grow to $37 billion in 2019. Not surprisingly, mobile is becoming the platform of choice due to 4G/5G bandwidth connections and hyperlocal GPS targeting. Also, ad spend in online advertising continues to rise as a fraction of total ad spend, surpassing radio and television.
Native Advertising will play a more central role in marketing. While it may be already part of your marketing plan, it's becoming a must-have rather than a 'nice-to-have'. Native ads require some coding to set up, but they result in a higher CTR and yield. It pays off well the effort. If you're not into native advertising yet, see this article to get started.
In the digital ecosystem, the third-party ad server is an important piece of the stack when serving ads. By evaluating metrics and generating reports independently, the ad server brings back control to those who wish to fine-tune ad delivery. It allows advertisers to spend their budget more intelligently and publishers to optimize their yield while increasing their earnings.
AdGlare is a third-party ad server that can do just that, with an intuitive user interface and competitive price rates.
You can get a free trial here.
This article is up-to-date as of early 2019.