Defining What is an Ad Network and how it Works

This post is updated on 22nd October 2021.

The online Ad network can be defined as a digital platform, created with the sole purpose of serving Ads to registered publishers. Those registered publishers are websites and Blog owners willing to earn some revenue from displaying Ads.

It’s a simple concept that is aimed at connecting the advertiser to bloggers and website owners willing to show those ads on their web pages.

In other words, “Ad Network” facilitates the connection between the advertisers willing to buy available Ad spaces (Inventory) from a group of publishers in different geographical locations across various categories (Niches).

1. Defining what is an Ad Network

Since the begging of internet marketing which includes online advertising in the early 90s, Networks use served as intermediaries between advertisers and publishers.

Technology has advanced today with many functions that allow for more advertising optimization and targeting tools to reach more target audiences.

However, there are always two important parts or groups on every advertising platform which are the Advertisers and Publishers.

Advertisers are businesses or individuals willing to promote their products or services online with the hope of getting more traffic and increasing their sales, on the other hand, Publishers are individuals willing to display Ads from particular advertising platforms to earn some income through their traffic clicks and impressions.

[button link=”https://adstargets.com/blog/advertising-networks-frequently-asked-questions/” type=” big” newwindow=”yes”] You may also like: Advertising Networks Frequently Asked Questions[/button]

The advertisers are often businesses or individuals, they pay them, create ads and submit those ads for approval by the admin. once the Ads are approved, they are shared on the publisher’s web pages.

Ads sharing follows a process and guidelines based on the preference of the publisher. While creating Ads from the Adnetwork inventory, they select specific Ads based on their location, keywords, and niche.

To avoid confusion, these ad networks include only online advertising and not traditional advertising media which include television, printed media, and radio.

The Pricing model mostly used is CPM, CPC or PPC, CPA, etc. AdNetwork like AdsTargets offers publishers the ability to create different Ad units like Banner Ads, Text Ads, Interstitial Ads, In App-Ads. Additionally, publishers can choose their preferred device to publish their Ads.

2. What is the Difference Between an Ad Server and Ad Network

This is one of the most asked questions by newbies in the advertising industry. To clear the confusion, we explain in simple terms below.

What is An Ad server? In simple terms, it is simply an inventory tracking, monitoring, and managing advertising technology used by Advertisers, publishers and use to run and give specific accounts on Advertising campaigns. This is further categorized into two distinct types based on their users.

The first one is the “First-party Ad server which is mostly used by publishers (A publisher Ad server) while the third-party ad server is used by advertisers (An advertiser Ad server).

Another term that is widely used is the SSP “Supply-side platform”.
This is also a similar technology that offers almost all the functions but a bit different in accessing the inventory and delivery method of distributing Ads which makes it different from the previous two. For more on Ad servers, see the video below.

This is another form of advertising technology but unlike ad servers, this technology is mostly used for the management of multiple advertising campaigns that store creatives use during transactions of media purchases between the publisher and advertisers.

The next complication after understanding Ad servers and these Networks, one will ask how do they work which takes us to the next level.

Just to refresh your memory, An Advertising Network work by collecting and listing all the available inventory from publishers and selling them to potential advertisers willing to pay a premium price for them in form of PPC, CPA, or CPM.

Here’s How Ad Networks operate
An ads network collects a massive number of publishers to deliver the required amount of inventory to potential advertisers on a premium price or auction basis.

The Advertisers use the Advertising Networks campaign management platform to set up Ads which are then automatically distributed to the publisher’s available inventory.

These online advertising solutions offer advertisers the flexibility to create multiple campaigns and consolidate the reporting metrics on campaign performance.

Also, the advertisers set have the possibility to set up their campaigns based on their desired prices per click, impressions, and action.

Targeting through demographics, location, keywords, and budgets are all features offered by the admins to advertisers

Once The Ad networks approve advertisers’ Ads, Advertisers are allowed to change their banners, Text, and targeting as they please.

All these Ad management systems are offered within the Advertiser CPanel (Campaign management panel). No time limits or restrictions are placed as the system is managed online 24/7.

In the early 90s when there were few online advertisers and publishers, Publishers were fine using only one Advertising Network to source their available inventory but as the internet marketing business became more massive, they figured using multiple ads networks pays better and that’s why today you see most publishers use various networks on their inventory spaces which also forced them to drop their rates.

The image below shows the risk associated and rewards when inventory is sold to different ad networks.

4. How do Advertisers and Publishers benefit these Networks?

There are many ways both advertisers and publishers benefit from these.

Ad networks serve as a bridge that connects advertisers and publishers together. This makes marketing and economic sense for all parties but let’s discuss them differently.

Advertisers benefits from Ad networks

When the primary purpose of these servers is to provide an avenue for publishers to sell their available inventory, they also provide a lot of benefits for Advertisers in the following ways.

Scalability: Advertisers have the opportunity to buy many inventories at a time through the platform and at the same time, Ads networks provide them with the opportunity to monitor and manage their ad campaigns in a centralized system.

Campaign management: It helps advertisers save a lot of time as they are able to manage multiple ads within one system and not move on many publishers’ inventory spaces or web pages. This could be a benefit as they reach more audiences within one system.

Measurement and Campaign reach: Advertisers have the ability to manage their measure their campaign performance and adjust them whenever they are pleased.

They can adjust their campaigns either by increasing their budgets or targeting.

Ad networks also give advertisers the ability to collect data and retarget individuals that visit their web pages.

Publishers’ Benefits from Advertising Networks

The most beneficial factor for publishers using Ad networks is to sell their available inventory which was not easy to be sold directory to advertisers or advertising agencies.
Ad networks offer such opportunities and in some cases, they are able to make constant income from selling their inventory on these networks.

5. What are the Targeting

possibilities

?

The targeting functionalities offered by Ads Networks are many with many decision-making functions that allow the advertisers to manage their Ad campaigns.

The Advertiser Cpanel gives them the opportunity to choose which web traffic is most suitable for their campaign when to target a specific audience, and how to target them. the following are the targeting criteria offered by Ads Networks RON: Run on all sites in the ad network.

1. • ROS: Target specific domains/publishers in the ad network

   • IAB categories

   • Geolocation

   • Keywords (context)

   • Time of day

   • Browser type / OS

   • … and many others

     Here some examples of popular ad networks

   • AdsTargets

   • One by AOL

   • AdMob by Google

   • Yahoo Gemini

   • Google Display Network

   • Meredith

   • AdCash

6. Various Types of Ad Networks

Here we show the different types of Ad networks and their pricing models

• Premium Ad Networks: These types of networks offer their inventory to the most popular publishers in the market

• Vertical Ad Networks: These are mostly focused on specific topics such as Technology Ad Networks

  , Business Ad Networks, Automotive Ad Networks, Fashion Ad Networks

  , etc.

• Performance and Affiliate Ads Networks: These types primarily use revenue share methods such as the CPC, CPM or CPA pricing models

• Inventory-Specific or Specialised Ads Networks: Typically focused on specific types of inventory such as Mobile Apps. Mobile devices , Video, Native Ads, etc.

The traditional Ad networks offer the advertiser the benefit to buy a package of impressions on a CPM pricing model.

7. What is the Difference between Ad Networks and SSPs

Even though these two have similar functions, and serve almost the same purpose, there are still some differences that exist between them in terms of technology, inventory, clients, Ad optimization functions, and targeting.

Inventory: SSPs tend to offer real-time bidding (RTB) and buy inventory that is available from the publishers known to be of “lower quality”.

While on the other hand, Ads Networks sell their available ad inventory to brands by giving them access to premium and exclusive publishers.

Technology: SSPs functions allow only Ad delivery, the combination of SSP/DSP (demand-side platform) can be considered the partner of networks.

Optimization and Targeting: Advertisers are allowed to manually target and optimize their campaigns to reach a specific audience. However, the combination of SSP/DSP uses special machine learning technology.

SSPs utilizes programmatic technologies to automatically optimize ads for publishers, Similarly, DSPs also optimize Ad campaign for various brands while allowing them to target a specific desired audience.

8. How Ad Networks evolved

As the digital advertising market evolved and became more competitive, Ad Networks have engaged in a battle to maintain a significant amount of their share market.

They constantly offer more appealing functionalities to attract more publishers and advertisers.
Because of the competition, marketers are constantly searching for one in all solutions.

It forces the Ad network to increasingly offer the same tools as SSPs which is massively closing the gap between them.

On the other hand, as SSPs also compete for more publishers, they tend to offer functionalities to attract more premium publishers.

At the same time, they offer advertisers the opportunity to buy inventory directly which makes them similar to Ads networks.

SSPs have evolved a lot as they connect advertisers and publishers (the demand and the supply side). It will be self to say they have evolved towards the programmatic direction.

This further closes the gap between Ad networks and SSPs. For instance, ad networks gradually transcend premium inventory as they integrate programmatic engines that optimize the procured RTB supply.

In addition, they are also connecting their own available supply to specific DSPs in a bid to increase fill rates for their portfolio of publishers.

Advertising has evolved a lot in general since the first banner Advertising was published in the early 90s.

We have experienced very high levels of competition among Ad networks as they constantly introduce new advertising functionalities.

Recently, In-App Ads and push notification ad formats have been introduced which has also seen spikes in advertising budgets. the advertising industry will constantly see changes in the near future.

Conclusion

We have tried to explain most of what you need to know about Ad Networks and how they work for the benefit of advertisers and publishers, however, we will continue to update this post to bring you the latest information about the networks.

Feel free to share your experience, observations, and objections in the comment section below.