Ad tech is complex. And when something is complex, terms often get confused or misunderstood.
A perfect example of this is the confusion between ad networks and ad exchanges, two completely different platforms that are often – and mistakenly – used interchangeably.
That is why we’re here – to clear things up for you.
We’re going to go explain what exactly ad networks and ad exchanges are, their differences, similarities, and which one is right for you as a publisher.
What Is an Ad Network?
An ad network is a company that connects advertisers with publishers, acting as an intermediary for the sale of ad inventory between publishers and advertisers.
Ad networks provide publishers with a way to monetize their traffic by displaying ads on their websites or apps, while also providing advertisers with access to a wide range of online inventory and audiences.
Advertisers are able to set specific parameters for their ad campaigns, such as budget, demographics, and interests. Based on these parameters, the ad network matches the advertiser to the publisher that best fits.
Ad networks can vary in size and focus, from small niche networks that specialize in serving specific types of ads or audiences, to large global networks like Google AdSense.
What Is an Ad Exchange?
An ad exchange is a digital marketplace where advertisers and publishers can buy and sell ad inventory in real-time.
Unlike ad networks, ad exchanges don’t involve any intermediaries. The only two parties involved are the advertiser and the publisher, with each one having full control over what they buy and sell.
The process of an ad exchange is similar to an auction where advertisers bid and publishers select the highest bidder. What’s even more amazing is that this entire process happens in the blink of an eye.
A popular example of an ad exchange is Google AdX.
Ad Network vs Ad Exchange: Key Differences
There are a number of key differences between ad networks and ad exchanges:
Type of Service
Ad networks are companies that serve as intermediaries between publishers and advertisers.
Ad exchanges are open digital marketplaces where advertisers and publishers can purchase and sell advertising space in real-time.
Revenue Potential for Publishers
Ad networks buy ad inventory from publishers in bulk and for set prices, limiting the revenue potential for publishers.
Ad exchanges allow publishers to sell their ad inventory to the highest bidder, which result in higher revenue than ad networks.
Control for Publishers
Ad networks are largely automated and provide less control to publishers.
Ad exchanges give publishers full control over their ad inventory. They can set floor prices and choose which advertisers they wish/don’t wish to sell to.
Transparency
Ad networks aren’t transparent and publishers are unaware who is buying their ad inventory.
Ad exchanges are fully transparent, enabling publishers to know who is buying their ad inventory.
Implementation and Management
Ad networks are simple to implement and don’t require ongoing management.
Ad exchanges require careful implementation and ongoing management to ensure that publishers are maximizing their revenue potential.
Bidding
Prices in ad networks are determined ahead of time and publishers have no control over them.
Ad exchanges work with real-time bidding, allowing publishers to select the highest bidder.
Which One Is Right for You?
We recommend always going with ad exchanges because they give you more control over your inventory. You can also earn much more by using an ad exchange.
There is a catch, however. Ad exchanges require careful management and optimization. Premium ad exchanges like Google AdX are also hard to join. In fact, only select publishers, and very large ones at that, are invited by Google to access AdX directly.
If you didn’t receive an invite from Google, you can only access the premium exchange through a Google partner, preferably a Google Certified Publishing Partner (GCPP) like Adnimation.
Feel free to get in touch with our monetization experts to learn how we can help you maximize your ad revenue.
