An advertising network or ad network is a company that connects web sites that want to host advertisements with advertisers who want to run advertisements. Increasingly Ad networks are companies that pay software developers as well as web sites money for allowing their ads to be shown when people use their software or visit their sites.
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Overview
The advertising network market is a large and growing market, with the top 20 companies earning about $2 billion in revenues during 2007. This represents around 13% of the total display advertising market, forecasted to grow to 18% by 2010.[1] This growth has resulted in many new players in the market, and has encouraged acquisitions of ad networks by large companies entering the market. For example, Google has acquired an ad network called DoubleClick DoubleClick is a subsidiary of Google that develops and provides Internet ad serving services. Its clients include agencies, marketers and publishers who serve customers like Microsoft, General Motors, Coca-Cola, Motorola, L'Oréal, Palm, Inc., Visa USA, Nike, Carlsberg among others. DoubleClick's headquarters are in New York City, United States for $3.1 billion.[2]
Ad networks are primarily involved in selling space for online ads to appear. This online advertising inventory comes in many different forms, including websites A website [citation needed] is a collection of related web pages, images, videos or other digital assets that are addressed relative to a common Uniform Resource Locator (URL), often consisting of only the domain name, or the IP address, and the root path ('/') in an Internet Protocol-based network. A web site is hosted on at least one web server,, in RSS feeds, on blogs, in instant messaging applications, in adware Adware, or advertising-supported software, is any software package which automatically plays, displays, or downloads advertisements to a computer after. The object of the Adware is to generate revenue for its author. Adware, by itself, is harmless; however, some adware may come with integrated spyware such as keyloggers and other privacy-invasive, in e-mails, and on other sources. The dominant form of inventory remains to be third-party websites, who work with advertising networks for either a fee or a share of the ad revenues.
An advertiser can buy a run of network package, or a run of category package within the network. The advertising network serves advertisements from its ad server, which responds to a site once a page is called. A snippet of code is called from the ad server, that represents the advertising banner.
Large publishers often sell only their remnant inventory through ad networks. Typical numbers range from 10% to 60% of total inventory being remnant and sold through advertising networks.
Smaller publishers often sell all of their inventory through ad networks. One type of ad network, known as a blind network, is such that advertisers place ads, but do not know the exact places where their ads are being placed.
In most cases, ad networks deliver their content through the use of a central ad server Ad serving describes the technology and service that places advertisements on web sites. Ad serving technology companies provide software to web sites and advertisers to serve ads, count them, choose the ads that will make the website or advertiser most money, and monitor progress of different advertising campaigns.
Large ad networks include a mixture of search engines A web search engine is designed to search for information on the World Wide Web. The search results are generally presented in a list of results and are often called hits. The information may consist of web pages, images, information and other types of files. Some search engines also mine data available in databases or open directories. Unlike Web, media companies, and technology vendors.
Types of Ad Networks
There are three types of online advertising networks:
- Vertical Networks: They represent the publications in their portfolio, with full transparency for the advertiser about where their ads will run. They typically promote high quality traffic at market prices and are heavily used by brand marketers. The economic model is generally revenue share.
- Blind Networks: These companies offer good pricing to direct marketers in exchange for those marketers relinquishing control over where their ads will run. Blind networks achieve their low pricing through large bulk buys of typically remnant inventory combined with campaign optimization and ad targeting technology. The financial model is arbitrage.
- Targeted Networks: Sometimes called “next generation” or “2.0” ad networks, these focus on specific targeting technologies such as behavioral or contextual. Targeted networks specialize in using consumer click stream data to enhance the value of the inventory they purchase.
There are two types of advertising networks: first-tier and second-tier networks. First-tier advertising networks have a large number of their own advertisers and publishers, they have high quality traffic, and they serve ads and traffic to second-tier networks. Examples of first-tier networks include the major search engines A web search engine is designed to search for information on the World Wide Web. The search results are generally presented in a list of results and are often called hits. The information may consist of web pages, images, information and other types of files. Some search engines also mine data available in databases or open directories. Unlike Web. Second-tier advertising networks may have some of their own advertisers and publishers, but their main source of revenue comes from syndicating ads from other advertising networks.
While it is common for websites to be categorized into tiers, these can be misleading. While Google is in the clear majority of advertisement impression served, other networks that could be labeled as tier 2 actually dominate over these tier 1 ad networks as far as the number of customers reached.
See also
- Ad exchange Ad exchanges are technology platforms for buying and selling online ad impressions, and represent a field beyond ad networks as defined by the Interactive Advertising Bureau , and by advertising trade publications Advertising Age, iMediaConnection and ClickZ
- Ad serving Ad serving describes the technology and service that places advertisements on web sites. Ad serving technology companies provide software to web sites and advertisers to serve ads, count them, choose the ads that will make the website or advertiser most money, and monitor progress of different advertising campaigns
- Online advertising Online advertising is a form of promotion that uses the Internet and World Wide Web for the expressed purpose of delivering marketing messages to attract customers. Examples of online advertising include contextual ads on search engine results pages, banner ads, Rich Media Ads, Social network advertising, interstitial ads, online classified
References
- ^ Khan, Imran et. al (2007), "The Rise of Ad Networks", JPMorgan Chase & Company, Retrieved 04/28/10 from http://www.mediamath.com/docs/JPMorgan.pdf
- ^ Clifford, S. (4-28-2008.). A Web Shift In the Way Advertisers Seek Clicks. New York Times, Retrieved 04/10/10 from LexisNexis database.
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