Online advertisers rely on ad serving companies to perform an increasing number of tasks and services for them. But it hasn’t always been that way.
The Early Days
Before the advent of online advertising as we know it, the infant World Wide Web went through a period of aggressive link-trading and bartering. The first online ads were text links or simple graphics hard-coded by publishers into the pages of their Web sites. That is, advertisers would send their graphics to the publisher and the publisher would host and serve them. Often, an ad would take up residence on a Website until the publisher decided to switch it out for that of another advertiser. Changing the ad on a page usually meant altering the code of the page itself, which required an HTML programmer.
As more businesses began to participate in the Internet gold rush and promote their newly debuted Web sites, demand increased for tools that would help publishers manage the numerous ad campaigns piling up on their sites. Programmers wrote simple CGI scripts to rotate ads throughout their Web sites, but significant technical efforts were required to launch campaigns, take them down, or pace the delivery of ad impressions over time. As a site’s advertising base increased, publishers began to become frustrated by the expenditure of the time resources necessary to manage ad campaigns. Moreover, ad agencies and online advertisers grew tired of requesting ad view and click reports from every site in their campaign, and the tedium involved in aggregating and processing this information.
HTML allows Web pages to be constructed dynamically, often pulling page elements from different Web servers. Advertisers who had been shipping ad graphics off to Web publishers quickly figured out that these publishers could just as easily call Web graphics from the advertiser’s Web server. This simplified things greatly, as advertisers could look at their own Web server logs to determine how many hits and clicks an ad graphic received. However, it became clear to Web site publishers that a solution was needed to help manage campaigns, as well as the ad graphics and remote server calls that comprise those campaigns. Enter commercial ad serving.
Publisher-Side Ad Servers Emerge
DoubleClick, NetGravity, Accipiter, Real Media, ClickOver and MatchLogic were among the first entrants into the field, offering campaign management tools for publishers. The tools these companies offered enabled a publisher’s pages to carry ‘ad tags’—basically pieces of HTML code that called for ads to be inserted into the pages from the remote ad server. The companies coded ad placements, so that publishers could differentiate between placements and offer ad packages like section sponsorships. Some placements were coded dynamically—on the fly—so that parameters could be passed back to the ad server. This enabled publishers to offer targeted ad packages like keyword-triggered advertising. The ad server would receive input from the publisher’s Web site, such as a search keyword, and deliver an appropriate ad back to the user.
Ad Serving for Advertisers
Meanwhile, advertisers and their agencies began to get nervous. No such solution existed to manage the multiple creatives, ad sizes, click URLs and other variables associated with every online advertising campaign. Even agencies with only a few clients found themselves struggling to traffic, track and optimize online campaigns without wrestling with minutiae. Furthermore, gathering campaign performance reports from multiple sites and aggregating the data seemed to take forever. Agencies and advertisers quickly identified the need for a new tool: The advertiser-side ad server.
Companies like Focalink developed pure advertiser-side toolsets, while some agencies and advertisers adapted publisher-side solutions like MatchLogic and DoubleClick’s DART to serve their needs. Now, publishing-side ad servers not only served ad graphics, but also calls to remote agency-side servers. For the first time, advertisers and agencies had access to consolidated reporting, on-the-fly creative rotation adjustments, simplified trafficking and more.
Ad Servers Get Smart
A significant development in tracking technology came about when ad serving companies learned to use cookies. A cookie is a short text file that resides on an end user’s hard drive; one that can be read and modified only by the Web server that sets it. Ad servers used cookies to identify end users and store information about them. When an ad server is called on to deliver an ad graphic, it often sets a cookie on the end user’s machine. The ability to identify users allowed for advanced functionality, such as frequency-capping, ad sequencing and storing server-side profiles on users. Any time an advertiser requested an ad graphic from an ad server, it had the opportunity to read the user’s cookie and any profile associated with it. The server could then determine, based on simple logic rules, the most appropriate ad to display to the user.
The use of cookies was also instrumental in enabling ad servers to track back-end actions like purchases from an ecommerce site. Placing a small, transparent image on the “Thank You” page that is returned after a successful ecommerce transaction enabled the ad server to read the end user’s cookie. This, in turn, allowed the ad server’s database to associate the transaction with the ad that referred it. The small transparent images are still in use today, and are commonly referred to as “pixel tags” or “Web bugs.” The various ad servers have developed names for their pixel tags, for example, DoubleClick calls them “Spotlight Tags,” Atlas calls them “Action Tags,” etc.
Ad Servers Get Too Smart
As ad servers grew more robust in their functionality, the course of the natural evolution of the pixel tag/cookie technology headed in a direction many consumers were uncomfortable with. Given that cookies could identify individual computers and allow for server-side profiles to be built on end users, ad servers made attempts to associate those profiles with offline data. Indeed, several companies in the ad serving space, including DoubleClick and IMGIS (later AdForce), also attempted to secure partnerships with or acquire offline data companies. IMGIS aligned itself with Experian, hoping to pipe over 400 data fields into its profiles of Web users. These profiles included information traditionally used by direct marketers to target their marketing efforts, including retail and catalog purchasing history, mailing addresses, demographic information and more. DoubleClick purchased Abacus, a company that maintained data profiles on nine out of every 10 American households.
While these moves would have offered online advertisers an unbelievable array of targeting options, privacy advocates resisted them. Press stories trumpeted headlines about the loss of anonymity on the Web and consumers revolted. This forced ad serving companies to abandon the association of any Personally Identifiable Information (PII) with their cookie profiles.
Ads Get More Complex
Over time, marketers and ad agencies came to expect more from online ads. Simple GIF banners allowed for animation, but not for interactivity (beyond taking a user to a Website if they clicked on it). Designers began to build ads that contained HTML forms, ads that leveraged the capabilities of Java and browser plug-ins like Shockwave and Flash, and ads that contained streaming video. These rich media ads required not only special ad tags, but also presented a challenge—users could take more action with them than simply clicking on them to go to an advertiser’s Website. They could submit information, play games or even conduct ecommerce transactions right within the ads. And advertisers wanted ad servers to track this interaction.
With the rise of rich media companies like Enliven, Bluestreak, Unicast and others, ad functionality became more complex. There were more ways for end users to interact with rich media advertising. Rich media companies responded by developing reporting on advanced functionality like ad interaction time, clicks to multiple destinations, information submitted through ads, and more. Many saw this as a missed opportunity for the ad serving companies. However, read on and you’ll see how ad serving companies are capitalizing on this now.
The Ad Server as Marketing Platform
Ad serving companies were quick to identify their products as the focal point for all things pertaining to the administration of online campaigns. Given that the eyes of agency media planners were glued to administration and reporting screens for a good portion of the day, ad serving companies turned their attention toward developing more tools for media planners and buyers. Companies like AdKnowledge (born out of the merger of Focalink and ClickOver) developed searchable databases of advertising opportunities, contacts and pricing information from major publishers. Later, ad serving companies like DoubleClick and Atlas DMT would automate tedious planning tasks like composing, sending and processing RFPs (Requests for Proposal) via email and the Web. They would also provide planning tools like predictive reach/frequency/GRP applications and email campaign administration. Major ad serving players, especially DoubleClick and Atlas, continue to evolve along these lines, aiming to make media planning, buying and campaign maintenance easier and faster for the advertising and agency communities.
Capitalizing on a Missed Opportunity
Perhaps the most significant development in the evolution of the ad server is the ability to manage rich media. For years, rich media companies charged significant premiums for the ability to implement advanced ad functionality and tracking. Some charged advertisers, some charged publishers. Recently, however, DoubleClick introduced its Motif product, which some say will render rich media companies obsolete. Motif enables facilitated serving, tracking and reporting of rich media advertising built with Macromedia Flash, which many consider to be the most widespread and robust rich media platform to date.
Where Advertiser-Side Ad Serving Is Headed
It’s ironic that the serving of ads represents a smaller part of a major ad serving company’s business every day. Companies like DoubleClick, Atlas DMT and Mediaplex, long known for their ability to serve and track campaigns effectively, are now committed to providing tools that streamline aspects of the planning and buying process. Some look to these companies to help them manage this process from beginning to end, to include such things as research tools, predictive modeling applications and even accounting modules to help agencies reconcile media invoices and better manage the flow of dollars in and out of the agency. These applications get better every day, and in many cases, have played an integral role in the agency’s process flow. Look for ad serving companies to continue to add functionality to address inefficiencies in this process.
Look also for ad serving companies to add advanced rich media capabilities to their offerings. Decreased reliance on independent rich media companies means a faster and more streamlined implementation process for rich media campaigns. That’s where many ad serving companies are looking to add value.
In fact, the most forward-thinking ad serving companies are completing a transformation into online advertising solutions companies. Wherever you see inefficiency in the online campaign development or execution processes, ad serving companies are looking to address the problem.
About Underscore Marketing
Underscore Marketing is a next-generation media and strategy shop founded in May of 2002. Since its inception, Underscore has attracted top-notch talent, including some of the innovators who have helped guide the industry through the emerging media landscape. Underscore’s deep understanding of all forms of media drives its success as a cross-platform shop that delivers top-notch expertise to its clients, both in planning and in execution.
