Ad serving has evolved into ad management. Geary Interactive's CEO/president describes the evolution, and predicts what's next.
The boom of online advertising has increased exponentially since the early days of the internet, with more advertisers than ever now turning to the web as a medium to effectively advertise through. According to the Interactive Advertising Bureau (IAB), advertisers spent an average of $71.51 per user last year, which is expected to increase to $88.28 this year and up to as much as $100 per user next year. This steady rise proves that there is a strong urgency for continuous renovation of methods to improve online advertising techniques. We have come a long way, and it will be interesting to see the evolution of this advancing trend.
Ad serving at its onset
Simply defined, the technology of delivering ads on the web, known as ad serving, involves displaying banner ads on a website while calculating the impressions, clickthroughs, inventory and analysis of a user to which the ad is being delivered. This method of reaching online users has become the backbone of the advertising industry, and now more than ever has to reach its optimum to keep up with changing trends.
Not long ago, ad serving involved advertisers buying banners and paying a set price for fixed placement where impressions did not matter too much. The development of this application evolved into a CPM environment where data became more and more important, opening the opportunity to implement rules and regulations.
The demand to put parameters on this tactic pushed the ad-serving technology to new heights, leading to third-party ad serving and increasing the sophistication of the interface. With third-party serving, limitations could be set on banner sizes, sections, frequency caps and quantity in order to maintain controlled tracking and cost for campaigns. Originally controlled by publishers, ad serving introduced the need for data and parameters and then finally progressed into third-party control, but somewhere in between, advertisers sought more.
The ability to track data is what puts our industry ahead of the rest, and what makes us want more. We want increased sophistication. An example of this is behavioral targeting, which enables advertisers to directly connect with the appropriate online audience. What this means, for example, is that if a user searches for an automobile and reads about this material for a certain amount of time, the advertiser can detect that this user shows a high propensity for automobile searches, and serve related advertisements in any other sections the user visits. As a result, the data of consumer behavior has been mixed with ad-serving data.
Early obstacles
Although this seemingly flawless design was introduced to make advertisers' and publishers' lives easier, various hurdles that arose verified the need for a seamless management system.
The first issue concerning ad serving was whether publishers were reporting accurate numbers. When ad-serving data was collected, discrepancies between the publisher's data and the advertiser's data showed conflicting results, so although we could see that the numbers were different, we did not know who was actually correct. This particular problem contributed to the necessity for audits.
The second question was related to ad ownership. Bestowing the publisher with complete ownership gave them the ability to control the advertisement's cycle, rotation and placement, not necessarily aligning with the advertiser's recommendations. With ownership entirely in the hands of the advertisers, they would control all aspects of the campaign, diminishing approval by the publisher. The solution is a collaborative system that allows for the same functionality to be given to the advertisers and the publishers, minimizing campaign confusion.
The third obstacle involved campaign maintenance. If an advertisement is down for any reason, who is at fault? Because of the volatile nature of servers and their technical counterparts, there is a chance that at any time, the ad can go down, and it is up to either the publisher or the advertiser to pay the supplementary costs. A comprehensive ad-management system would allow for maintenance of advertisements with respect to uptime and tracking.
As additional hurdles came up, it became obvious that a type of management system was needed to address the questions of how the two forces link together and how much ownership the publisher should give up. The solution was simple: ad management.