What is the difference between ad exchange and ad network?

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Advertising as art has appeared quite soon after Internet inventing. In the beginning, advertisers and publishers tried to resolve the situation by themselves. Generally, they tried to contact each other directly. 

Another problem is that this method can’t give you high volumes of traffic. There are thousands of websites with related topics related to your niche and it is silly to have high expectations from 10-15 occasionally found websites.

The method was also not always effective as required time and energy resources. Besides, the changes couldn’t be implemented immediately that was also quite frustrating. The demand was growing and ad networks creation was a way out. 

What is an ad network?

To say it simply, it is the first attempt to have organized and quick campaigns. Networks behaved like an intermediate between main players. Everything seemed to be quite convenient as publishers could sell remnant inventory (direct sales generally refer to premium inventory), advertisers could plan their budgets and run campaigns where the process could be tracked immediately and amendments added at any moment as well.  

However, something is rotten in the state of Denmark. Cheat cases of fraud by both sides happened quite often. In addition to that, one should understand that advertising itself is quite an expensive thing and ad networks used to take a commission for their services. Nowadays the situation is a bit better, but business promotion was hardly possible for small companies as it was extremely expensive. 

Advertisers could be also a bit frustrated as nobody could guess where your ad will be posted, i.e. the neighbours are always different and it is the time you can’t choose them. For example, you sell fishing equipment and being located next to beauty products seems to be a bit irrelevant and, in some cases, inconvenient and undesirable.

 

One more confusing fact is that advertisers could buy the number of displays where their potential audience is likely to hang out. It means that, for example, if you buy displays on a beauty blog, you will receive the whole scope of those who have entered the blog occasionally or simply not interested in your products. You have burnt your money twice: for wrong displaying and for not showing your offer to those who can appreciate it. 

Something certainly should have been done with it..

What is an ad exchange?

Advertisers started thinking about something with a more personalized effect. The system of the auction was created – RTB (Real Time bidding). The main idea is about bidding for each particular impression. Advertisers decide how much they are ready to pay on the ground of such information as to location, approximate age, interests, type of the device used and so on. 

Ad exchange here is some kind of online playground where all participants gather to participate in this buy-sell process. It is a wonderful opportunity for inventory owners as they still have non-sold places and here they can offer it. 

The whole process is absolutely transparent and is cheaper than a traditional one as no third-parties are involved. 

Small business owners can breathe freely as promotion options are now available for them, too. Ad exchange makes it possible to set the limit one is ready to buy or sell the equipment. 

Of course, there are cases when inventory could be sold at too low prices, but opposite variant is also possible so that publishers can win even more in comparison with ad networks.

Advertisers, in their turn, deal with the more motivated audience as the process is highly personalized and the ad will be shown to those who fit your criteria. 

Does it mean that ad exchange is better than an ad network?

Actually, polus.media doesn’t recommend thinking so, the same as we don’t consider a chair more useful than a window. Both of the notions in a subject deal with the advertising process, but they represent it from different sides, so the comparison can be a bit incorrect. 

To be honest, most of the advertisers nowadays use both of the approaches. The first reason is that different websites can be tuned in to the system and it will be unwise to skip such a big piece of the pie.

Some experts predict soon dying out for ad networks. We are not so quick with the conclusion as there is another tendency is expected. The point is that ad exchanges and networks acquire some traits from each other, and there can be some kind of auction offered for those who prefer traditional forms of advertising and vice versa. 

Share with us your experience about using any of these variants – are using them now and how you feel about them?

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