The What, Why, and How of the Advertising Technology

In this day and age Internet is the ultimate field of opportunities. Just think about it - everything is within a click or two. You can do practically anything. Naturally, you can make money on the web - in fact, you can make it out of any user’s move (because duh, why not?). The whole monetizing frenzy is hitting the fever pitch right now and it important to understand how to “make it” “the right way.”

Advertising might seem like a logical answer. But it is not that simple – as the fella said: “Be prepared to enter the world stranger than you have ever imagined”. Jokes aside – you will need some serious technology to pull this off. And that is where magic words “Ad Tech” turn up.

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Since advertisement business is experiencing a period of bloom due to increasing amount of time spent by consumers on digital media – it is a logical solution for an issue of monetizing traffic and a sound way of improving interaction with the user on the platforms.

What is Ad Tech?

Ad Tech (shortened “advertising technology”) is an umbrella term that describes systems of analyzing and managing tools for advertisement campaigns. It covers the entirety of ad delivery process from selecting the subject of the ad and its position to choosing its recipient. It allows you to see bigger picture regarding your campaign and lets you make use of it to maximum effect.

Direct benefits of this tight knot of wide array processes are the higher efficiency of operation which means growing brand recognition which leads to increased profits. That indirectly leads to an expansion of interest.

However, there is a catch. Ad Tech is not something you jump on and ride. Advertising is a costly thing and you need to be sure that every dime is doing tick-tick-tick. The whole thing is extremely demanding from technical and logistical points of view. It involves the unbelievable amount of data and needs enormous computing capacities. Because of that, you need services of Ad Tech companies who know it inside out and can turn it upside down to get through. In this sense, Ad Tech companies are some sort of cavalry.  

The major benefit of implementing advertising technologies is that it minimizes budget spending and makes the whole thing much more cost-effective.

In order to make maximum effect from the ad tech adjusted campaign, the company needs the system that is specifically designed for its needs. The mechanisms that process and categorize incoming data needs to be specified to a tee. It should fit perfectly in order to make the process of managing, delivering and targeting of the adverts as effective as possible. It helps you to make sense of collected data and put it to use. It finds the links and connects the dots.

AdTech: How Does It Work?

How does it work?

Ad Tech primary field of operation lies in the analysis, management, and delivery of advertisements according to the requirements of the campaign. The endgame of every campaign is more or less the same - increased effectiveness and growing activity on the used ad space AKA the “do be do be do” part of Strangers in the Night.

This achieved through collecting and processing information on the user activity on a particular platform. Among the parameters monitored are:

  • length of the session;
  • density and type of events (clicks, selecting, button pushing, scrolling, etc);
  • overall behavior on the page;
  • thematic preferences over the course of the session.

This information helps to makes ads closely connected to the customer’s interest. Usually, it is one of the two - it is either based on the context of the session and/or preferences of the user. In result of accordingly adapted content the value of the ads to the customer increases and so are the chances of his reaction to it.

One of the main “weapons” used by Ad Tech is retargeting. It is a way of bringing the users back to the site after they left. This method works with showed intentions of the users that were registered by the system. It shows ads connected to it throughout the user’s subsequent journey through the web.

But before this happens there few more steps in the way. Collected data is unstructured and needs to sort out. In order to do this, it is being transferred from site to separate Data Management Platform (aka DMP). Its purpose is to go through, analyze and categorize incoming data. This helps to correctly segment the audience and optimize the campaign. Also DMP ties together activity and incoming results of the campaign into one relatively easy-to-follow interface where it is.

After data is sorted out - it is sent to Ad Server which operates the ads through the ad spaces and directs specific ads at specific users. That is where retargeting kicks in. Data on user interaction with ads is also being collected and sent to DMP. That allows adjusting campaign according to incoming results.

The basic scheme of Ad Tech operation looks like this:

  • User activity and behavior on site is being monitored;
  • Data from the website is being transferred to Data Management Platform where it is  being sorted out, categorized and segmented according to set specifications;
  • After that, the segmented data is sent to Ad Server which delivers appropriate and relevant ad content to the user. It may be:
    • Personalized according to user behavior and traits;
    • Contextual - based on user activity.
  • User activity on the ads is being monitored;
  • Ad Campaign adapts to incoming information and collects cream of the crop.

If done right - Ad Tech maximizes the efficiency and profits of the campaign.

You can also read a case study about our experience of developing Custom Affiliate Marketing System. 

In conclusion

One of the major advantages of using Ad Tech is that it allows integrating the whole toolset into a single system. Numerous automation and conjunct workflow enable more precise and expedient audience targeting. Because of that, it is possible to collect more diverse data that will result in highly relevant and precise inciting ads.

This, however, doesn’t solve the issue with the quality of the ads which is an entirely different story.

It should be noted that there is no magic behind Ad Tech – it all depends on skills and ability to use them correctly. The basic scope of operations is leaning on tried and tested solutions and trustworthy platforms. This approach is reasoned by two things: the need to keep the information safe from leaking and the need to stay away from the frauds.

If you want to know more about ad tech fraud and what can be done to fight it - here’s our recent write-up on the subject.