An Ad Server, and a Mobile Ad Server is a mobile focused version of the concept, is a self-serving software solution hosted on a web server for advertisers to manage their mobile ads. With an ad server, advertisers can upload advertising creatives to be displayed on multiple ad platforms from mobile publishers inside their mobile apps and mobile websites, optimize ad campaigns, get reports on their performance in real time, track such key parameters as conversion, attribution and costs.
Among pros, that ad servers bring up for mobile app advertisers, are easy-to-use, control over bids and budgets, campaign scheduling, sophisticated targeting, as well as transparency in ad campaigns analysis and valuable insights to make data-driven decisions.
In 2019 digital advertising spending worldwide reached $333 billion, $50 billion up from 2018. The top 5 of countries, that spent the bulk of their advertising budget digitally, were China, with digital ads constituted 69% of the total media ad spending, UK – 66%, Norway – 65%, Ireland – 63% and Denmark – 61%.
In this guide we review the ad server space in detail, covering the major types of different ad serving and ad mediation platforms ranging from general players to specialist mobile and video ad platforms.
It consists of several key players and technical solutions, namely – advertisers, publishers, SSP (stands for Supply Side Platform), DSP (Demand Side Platform), ad networks and advertising agencies. In the intersection of all of them lies the crucial component of ad servers.
Table of Contents
- What is an ad server?
- First Party vs Third Party Ad Servers
- Hosted vs Self-Hosted Ad Servers
- Open Source Ad Servers
- Mobile Ad Servers
- Video Ad Servers
- Average eCPM rates
- Most popular SDKs
- Ad Serving Systems
Ad Server Definition
What is an ad server?
An ad server is an advertising software hosted on a server to manage online ad campaigns and used by publishers, advertisers, ad agencies, and ad networks. Ad server software defines what ad to display at what specific time frame and on what website or mobile app. There are multiple kinds of ad servers – open source ad server, self-hosted ad server, video ad server and more ad hoc ad server solutions.
In addition, it also collects data on ads performance (number of impressions, clicks, CTR ratio and more) for all parties to use, as well as defines targeting, performs ad budget control, and frequency capping. A publisher ad server helps web and mobile publishers to earn money with their inventory. Selling ads on their website or inside mobile apps allow publishers to generate revenue from the content they produce, while keeping that content free for their audiences.
Let’s look under the hood of an ad server and answer the question – what does it do? The sequence of events of a digital ad serving process looks like this:
- a user arrives at a website or opens a mobile app
- suitable to specific criteria ads are requested from the Ad Server. Such criteria may include, the date and time of day, the dimensions of the ad slot, the geo location, user device OS and more
- the Ad Server selects which ads should be displayed based on the criteria
- the selected ads are returned to the website or mobile app for the user to see.
- the Ad Server tracks each time the ad gets clicked and stores this data to provide analytics to the Ad Server user.
Now, let’s review several types of ad server companies, as well as several ways to split them into two major categories.
First Party vs Third Party Ad Servers
First-Party ad server is the one that is hosted on a publisher’s server to serve advertisers ads that it needs to display on its website(s) or inside mobile app(s). It helps to simplify and streamline the process of selling ad slots to advertisers. In times when no direct ad campaigns (sold directly to the publisher) are being run, the server defines what ads from a partner ad network or another ad server to display inside a publisher’s inventory.
Third Party ad server is used by advertisers and ad agencies to store and manage advertising code, as well as to deliver, track and analyze ad campaigns run on multiple publishers websites. It helps advertisers to verify the validity of data provided by publishers for impressions and clicks they delivered. Yet another use of a 3rd party ad server is to allow advertisers to run A/B testing to optimize their ads campaigns.
Hosted vs Self-Hosted Ad Servers
Hosted ad server is the one that is hosted for a client by an ad server company. Such servers don’t requite any technical knowledge for how to run it on a client’s side and wholly rely on an ad server professional expertise. They don’t requite installation, provide technical support, can be updated automatically.
Self-hosted ad server is the one that is hosted on a client’s own online server. It provides higher level of control over user’s data, as well as higher level of software customization. Obviously in a contrast with a Hosted ad server, this one does require technical knowledge for how to install it, as well as how to maintain it properly.
Open Source Ad Servers
Open Source server is a free ad server system that enables publishers, ad networks and advertisers to perform a number of operations with ads. Specifically – serve ads on websites and in apps, as well as collect data for impressions, clicks and conversions. It’s capable to manage and run ad campaigns for multiple advertisers, as well as from an ad network or ad exchange and perform other functions typical for a Third Party ad server. Essentially, the only difference between such server and a Third Party one is that the former provides its services for free.
Mobile Ad Servers
Mobile ad server is a web-based self-serving software solution for advertisers to manage their mobile ads they display inside apps or on mobile web. Among pros that they bring up for advertisers: they allow to have a control over bids and budgets, help with campaigns scheduling, provide sophisticated targeting, as well as guarantee transparency in ad campaigns analysis and valuable insights to make data-driven decisions.
Video Ad Servers
Video ad server is an advertising software hosted on a server to manage video ads. It handles video ads displaying on multiple websites or in apps to specific audience, as well as ads performance tracking and reporting to advertisers.
Average eCPM Rates
When it comes to choosing a specific ad platform, one of the major metrics for online marketers is eCPM, which stands for effective Cost Per Mile, where mile stands for a 1,000 ad impressions. Some of the recent eCPM rates for the leading ad servers presented on the following tables, for Android and iOS respectively.
- You can read more about mobile app advertising rates here.
Most popular SDKs
Every ad server company on the market has its own SDK – a software that publishers need to implement into their apps to display advertisers ads, manage their campaigns and track its performance via reports. According to MightySignal, mobile app and SDK intelligence company, the most popular SDKs on the market you can see on the following table.
Top 15 monetization SDKs in Top 200 Free iOS Apps
|Name||# of apps use it||% of the Top 200 apps|
|Google Mobile Ads||28||1|
|Facebook Audience Network||27||14|
|VungleSDK – iOS||17||9|
Top 15 monetization SDKs in Top 200 Free Android Apps
|Name||# of apps use it||% of the Top 200 apps|
|Firebase Cloud Messaging||133||67|
Ad Serving Systems
Also there are several core technologies and principles that make today’s digital advertising tick, let’s walk through the major ones to get an insight look into ad servers work. These include the following:
Waterfall is the system of prioritizing ad networks ads that a publisher displays in his desktop or mobile inventory one at a time. It implies defining what ad network should be the first to serve ads from and listing in a particular order all the rest ad networks a publisher works with. Due to the lack of competition between ad networks in such system, publishers can’t maximize their inventory revenue potential. The arriving of such system successor suggested developing programmatic advertising platforms.
Programmatic advertising is based on using software to buy digital advertising, in a contrast with traditional ways that involved human interaction such as issuing manual insertion orders, pricing negotiations and such. It brings higher efficiency to the whole digital advertising ecosystem, using software algorithms it’s possible to match advertisers needs and publishers inventory much more efficiently.
Real Time Bidding/ RTB
Real-time bidding is one of the aspects of programmatic advertising, it’s an online auction for advertisers to bid for placing their ads on desktop and mobile publishers inventory. Those auctions are often facilitated by ad exchanges or supply-side platforms.
Header-bidding was originally developed for a desktop online advertising and later was adopted to mobile advertising as well. In a contrast with Waterfall Ads, this system implies all ad networks that a publisher works with to compete with their ad offers for a specific ad slot publisher needs to fill in. A competitive nature of such system forces advertisers to increase prices to win that publisher’s slot and hence helps the publisher to maximize his eCPMs.
Ad Mediation is a web based software solution for publishers to participate in a real-time auction based selling. Its algorithm is designed to choose what specific ad network(s) to send requests to deliver the highest fill rate for publisher’s ad slots. The benefit of ad mediation for website and mobile app publishers comes from using of a single SDK, with which publishers can set priority for serving ad networks demand, according to their specific eCPM, geography and other parameters. Also, with ad mediation solution, publishers are in a position to force advertisers to compete over their inventory and so they can significantly increase their profit.
SSP (Supply Side Platform)
A supply side platform helps to manage inventory for publishers, faciliates them to monetize it and often also includes ad serving functionality. Via advertising networks or ad exchanges, SSPs are connected with the demand side of the online advertising equation – DSPs (stands for demand-side platforms). Essentially SSP is the tool for publishers to offer impressions on their websites or inside their apps to as many advertisers as possible and therefore maximize their revenue potential.
Now, once we’ve covered the ground for online advertising industry major definitions, let’s walk through the major advertising servers operating on the market.