What is Adtech and How do Adtech Companies Work? | 24 Aug, 2022
One of the crucial parts of running a digital campaign is Adtech. Advertisers use adtech to buy, manage, and measure digital advertising. In short, adtech refers to a broad term that categorizes the software and tools that agencies, brands, publishers, and platforms can use to not only target and deliver but also measure their digital advertising efforts. If you are new and looking for a complete understanding of what is adtech, why it’s important for agencies, or how adtech companies work, then you may scroll down the page for more information.
What is Adtech?
Advertising Technology, or as it is shortly known as Adtech is an inclusive term that offers various tools, technologies, and software to different brands and advertisers to utilize it to:
- Plan and optimize advertising campaigns.
- Reach the targeted audiences.
- Deliver digital advertising campaigns in the right frame of mind of the consumers.
- Analyze the results of digital ad campaigns.
- Utilize the technology for better use of advertising budgets.
To compile all the points above. Adtech provides different ways to streamline your process of buying and selling digital ads.
Why Adtech is Important?
It is important to understand that Adtech is not a one-ad-fits-all solution to ad placement. However, it offers a variety for brands, and agencies, to not only stand out but also set themselves apart from their competitors.
Adtech is a crucial part of the digital advertising campaign because of the large amounts of money that is spent which in turn helps the buyers optimize their budgets and sellers to maximize their revenue stream. The main goal is to deploy better ad placements, deliver the right content to the right person at the right moment, and reduce ad wastage.
Adtech also provides behavioral data that can be used to reach and target potential audiences better and measure the campaign’s success. Due to the fact that there are billions of data-driven insights from consumers, companies have now started to discover how cost-efficient these adtech solutions are.
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Important Methods Used by Adtech Industry
There are two common methods that are generally used by the AdTech industry. These are – programmatic advertising and omnichannel marketing. Though there are other online advertising tools as well, however, these are the most critical to know. To have a better understanding of Adtech solutions, you must first understand these terms.
- Programmatic advertising specifically reaches target audiences. It is unlike traditional methods of advertising, like billboards or TV ads.
- Programmatic media buying ensures that money is put to good use and only advertises to customers who don’t fit the targeted demographics.
- Omnichannel marketing involves technology to reach customers wherever they are. This marketing strategy includes mobile phones, desktops, and more.
It analyzes how customers interact with the brand no matter their methods, but digital advertising will reach them.
AdTech Basics
AdTech includes a variety of tools and software, such as supply-side platforms, ad servers, ad networks, etc to help advertisers deploy relevant advertisements to the relevant audiences. Let’s dig a little deeper into each of the technologies used in the AdTech industry.
What is Programmatic Advertising?
Programmatic advertising refers to the use of technology to purchase and sell digital ads. It’s an automated process to buy digital ad inventory from across the web, mobile, apps, video, and social media. It uses workflow automation and deep machine learning algorithms to ensure delivering the most effective ads considering various factors in mind like demographics, shopping patterns, and more.
With programmatic advertising, advertisers may achieve greater efficiency, transparency, real-time measurement, optimization, and more focused reach.
What is a Demand-Side Platform (DSP)?
A demand-side platform (DSP) is software that is used by advertisers to buy video, display, and mobile ads. It is a single, organized marketplace where advertisers can have access to publisher inventory through direct integrations, supply-side platforms (SSPs), and ad exchanges. As the name implies, DSP is driven by the demanding side of the advertising. This means that advertisers seek inventory that will help them to reach the relevant audiences at the right moment, moreover within a defined budget.
One of the key advantages of DSPs is that are cost-effective and efficient for advertisers to buy digital advertising inventory.
What is a Supply-Side Platform (SSP)?
It is a tool generally used by publishers that automates selling digital ad impressions like video, display, and mobile ads. Supply-side platform (SSP) is driven by the supply side of the advertising equation that is publishers who wish to sell their ad inventory. SSPs allow publishers to set the bidding range which in turn helps in maximizing their revenue.
What is an Agency Trading Desk (ATD)?
An agency trading desk (ATD) is a set of tools or services that are related to media planning and media buying that media agencies provide. ATD enables agencies to manage an advertiser’s programmatic, bid-based media purchases as they happen across channels. Though there are major media agencies that own agency trading desks, however, there are also independent trading desks (ITDs) that smaller agencies or advertisers own and operate.
What is an Ad Server?
An ad server typically serves ads to a website or app and reports their performance metrics. It is used by advertisers, agencies, ad networks, and publishers to serve ads to a website. They can ultimately act as central places for managing campaigns, analyzing and reporting their results.
AdTech vs MarTech
Adtech is mainly focused on reaching an audience through paid channels using advertising technology. On the other hand, marketing technology (or as it is popularly known as MarTech) focuses on reaching audiences via unpaid or owned channels.
Adtech uses advanced technology to facilitate media buying and optimizing ad spend. Whereas, Martech automates or facilitates marketing strategy implementation and processes on the basis of first-party data and through the media channels owned by the brand. Primary users mainly include marketing and sales teams.
Closing Remarks on What is Adtech
Advertising technology is evolving and is continuing to evolve offering brands an increase in efficiency and effective ways to reach their target audiences. Brands can leverage the capabilities of rising technology solutions to optimize their ad campaigns and make better use of their budgets. If you look at it, it’s a win-win situation.
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