What is Ad Exchange and How Does It Work?

ad exchange

What is Ad Exchange and How Does It Work?

This year the digital ad space defied all pandemic-related odds and rebounded 12%. When breaking the stats down further, you see that programmatic ad revenue likewise increased at nearly 25% growth. All this adds up to one thing: ad exchange is the best way to stay competitive in this advertising market. 

If you’re curious about how ad exchange can get you a share of that pie, this guide is for you. Continue reading to learn more about ad exchange, how it works, and how to choose the right programmatic advertising agency. 

What Is Ad Exchange?

An ad exchange is a reliable way to have a broad reach with an advertising campaign. It relies on an automated process and real-time bidding to buy and sell ad space and determine prices. This happens in something like a digital bazaar. The inventory ranges from in-game ads to connected TV ads (CTV), all with various formats (audio, video, clickable, etc.)

How Does It Work?

Trading in this vast technosphere requires you to use different platforms depending on if you are a buyer or seller of ad space. Ad exchange platforms mediate between the two groups, matching advertisers to publishers. The pricing structure also differs from traditional advertising in that the more interest a segment receives, the higher the price. 

Ad exchange software also does the work of

  • determining impressions
  • mining data
  • and translating all this into digestible info for international markets 

Now that you can define an ad exchange, it’s time to learn about the benefits.

The Benefits of Using Ad Exchange

Using ad exchange software to automate your advertising needs has many benefits, not the least of which is increased efficiency. This is because sourcing the right publisher or advertiser is a time-consuming task. The massive human input starts with negotiation and ends with the creation of the insertion order.

Ad exchange companies, such as google ad exchange, facilitate this process with proprietary algorithms. 

Another key benefit is the ability for advertisers to have more input as to where their ads will show. Consider this: if an ad is placed with an irrelevant publisher, the target audience is missed entirely, wasting ad dollars. Programmatic advertising solves this with publishing locations that are an upfront part of the ad exchange process. 

Choosing a Programmatic Advertising Agency 

Not all agencies are created equal, and as ad costs continue to rise, it’s essential to make sure that you’re getting the most bang for your buck. So one metric to examine is their media reach. For example, do they offer access to multiple venues such as social media, radio, and CTV?

Then, see if those platforms align with your advertising goals to help make your decision. Also, the best ad exchange agencies will implement fraud detection measures to glean out suspicious activity bad actors. 

Go Programmatic is a premier programmatic agency that offers a full-service campaign management experience. Our managed campaigns result in robust ROI’s. Contact us today to learn more about how you can take control of your advertising campaign.

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