There is a sweet spot in optimization testing duration called statistical significance, or reliability.
The anatomy of an ad call can be simple, or it can be an intricate process, a sort of dance between servers to deliver the right ad for the right price.
Let’s say that you were on the Internet one evening looking to buy a new laptop. You browsed some websites, searched for laptops and studied a few, even put one in your cart at Amazon. But you got distracted before you finished a purchase and went to sleep. The next day, you wake up to check the news and notice that there is an ad from Amazon among the headlines on the website. This ad shows you laptops and maybe even the exact same laptop you had abandoned in your cart. How did this happen? How did Amazon know you would be at this website and manage to buy an ad space there showing you the exact same laptop you had been looking at just a few hours ago? It goes a little something like this:
When you browse a website, the site’s web server returns a bunch of code telling the browser what to display.
Within this code is a link, known as an ad tag. In its simplest form, the ad tag points to the publisher’s ad server, which looks inside itself to decide what ad to show. The server then returns that ad to the browser for you to see, and the process ends. We will ignore the third-party buyer ad server call for now.
But more likely, the publisher’s ad server returns some code that points to what is called a supply-side platform, or SSP.
A Sell-Side Platform is a technology provider which takes publisher ad inventory and makes it available for sale in an auction environment (aka “ad exchange”). As the ad inventory is made available in the ad exchange, additional signals such as the geographic location and anonymous user id info are exposed programmatically so that buyers can decide whether to bid for the ad opportunity. Leading SSPs include Rubicon, Pubmatic, AppNexus, and AOL Advertising.
The browser now calls the SSP, which then starts what is called an auction on its own side, reaching out to and requesting bids from a number of demand sources. These demand sources could be demand-side platforms, or DSP, and/or ad networks.
A Demand-Side Platform is a universal buying platform that listens to online ad auctions (aka “ad exchanges”) and makes decisions whether to buy ad inventory on behalf of buyer clients. Buyers, also known as Traders, utilize the Demand Side Platform to buy ad inventory that meets their purchase criteria, including: maximum bid, geographic location, time of day, and anonymous user behavioral info. DSPs respond to ad inventory opportunities in real-time, usually within 100 milliseconds of inventory offered for sale (aka “bid request”).
The DSPs and ad networks look within their own sets of buyer relationships to find which ad they want to show to the user and how much they want to pay for it.
Ad networks allow media buyers to outsource trading operations. Ad networks are companies that utilize DSPs and feature their own, deep in-house trading expertise. Instead of working with a DSP directly, a media buyer can work with an ad network which will use a DSP on the buyer’s behalf, often at a non-transparent price markup.
DSPs may run another auction on their side to decide the most relevant ad and bid.
The DSPs and ad networks then submit a bid back to the SSP. The SSP executes an auction to find the highest-paying ad and passes it back to the browser. The code passed back to the browser essentially functions as a redirect, and the browser now calls the winning DSP directly. The DSP sends back the code containing the ad it wants to show. The code is a redirect to the marketer’s ad server and the browser then calls the ad server.
The ad server returns the actual creative and the ad is shown.
Learn about this and more on the site for Merkle's latest book, The Rise of the Platform Marketer.