What are Ad Exchanges and Their Types

Ad exchanges are gaining popularity among agencies, advertisers and publishers, but not everyone understands what it actually is. What is an ad exchange? How does it work? How can you benefit? Let’s discuss these questions.

What is it?

An ad exchange works like a marketplace with advertising inventory but in online mode. Advertisers are able to buy or sell inventory or ad space through a real-time auction. On an ad exchange platform publishers mark inventory, and buyers can purchase it (it is happening due to bidding technologies on special ad platforms).

The principles of operation

In a nutshell, the platform looks like a bunch of impressions. Publishers’ job is to put ads into this bunch, buyers’ task is to find the necessary ad and purchase it in real time. The system provides visitors with appropriate offers according to the previous behavior, position, demands of the user.

What is the main advantage?

Digital ad exchanges let advertisers find all needed ads in one place. It frees them from negotiations with individual publishers and saves a lot of time. So, exchanges are fast and effective way to find or to sell ads.

How do ad networks work?

Almost everyone can get access to online ad exchange. The process is held on a special demand-side platform (DPS ad exchange). But ad networks can buy advertisements from exchanges too. They benefit from inventory purchased from different publishers by marking and selling it. You cannot see the real price of the ad, that’s why people trust ad exchanges much more.

What is the difference between open and private exchange?

If you put your ad into open ad exchange, everyone is able to buy it. Private exchanges are used to control the buyers of your inventory. It is used among companies in close relationship or among publishers who don’t want their ads to be bought by networks.

Do SSP and ad exchange differ?

Not really. Supply-side platforms are used for “plugging” a great amount exchanges. It helps to gain a lot of buyers and create competition for the ads presented. Ad exchanges provide impressions while SSPs provide exchanges.

Who controls the process?

The flow of impressions is controlled by operators. They are responsible for publishing and giving access to the potential buyers. But it is impossible to track who buys or sells ads, so visitors can’t be sure about the place of the ad to show up. Publishers, in their turn, never know who is purchasing the inventory.

Ad exchanges are special platforms (websites) that bring together those who want to place their advertisements in a particular social network and those who offer their communities and accounts to place advertisements. There are several types of them. Ad exchange is a necessary tool in the arsenal of any advertiser and site owner.

What’s the difference between ad network and ad exchange?

Unlike ad exchange, advertising network is online platform that allows publishers to sell their offer to advertisers and/or agencies.

As usual online advertising network allows publishers to sell their offer to advertisers and/or agencies.

Ad network works with different pricing model – CPI, CPA, CPM, CPS