What is an ad exchange platform? Top ad exchanges in India

What’s more trending than ever in the ad tech industry are ad exchanges - connecting advertisers, publishers, agencies, and ad networks on a single platform. This blog post covers the What, Why, and How of ad exchanges. Read on to learn more.

• What is an ad exchange?
• Ad exchange vs. ad network
• Benefits of using an ad exchange
  • Publisher benefits
  • Advertiser benefits
• How ad exchanges work
• Top 5 ad exchanges in India

Let’s start with the basics.

What is an ad exchange?

In simple terms, an ad exchange is a virtual marketplace where advertisers and publishers buy and sell ad inventory through real-time auctions. Ad exchange platforms eliminate the need for advertisers and publishers to negotiate deals manually.

Moving on to another basic concept - ad exchanges are not the same as ad networks.

Ad exchange vs. ad network

An ad network is an intermediary between advertisers and publishers. It helps the two parties to buy and sell ad inventory based on different cost models like CPM, CPC, CPI, etc.

An ad exchange directly connects advertisers and publishers without the need for an intermediary. While it ensures transparency for advertisers in that they can see the price the impressions are sold for, publishers are aware of where ads are displayed and their value.

Another difference between ad networks and ad exchanges is that the latter uses a real-time bidding (RTB) system to run the auction for ad spaces (Read How ad exchanges work).

So, what are the benefits of an ad exchange?

Benefits of using an ad exchange

There are many other advantages to ad exchanges apart from the fact that they eliminate manual intervention to buy and sell ad inventory.

Publisher benefits

• The liberty to control various mechanisms like setting floor prices, blocking specific demand based on their preferences (for instance, competitor and sensitive ads), and targeting.
• Setting minimum CPMs at which they want to sell their inventory to ensure a fair price.
• Choosing ad formats and styles that their inventory displays on web pages or apps.
• Customizing colors, corner styles, and fonts for multiple ad placements.

Advertiser benefits

• Setting budget and targeting options, choosing bidding capabilities, behavioral profiling, and price settings.
• Blacklisting specific publishers and audiences according to preference.
• Placing limits on the number of times an ad appears to the same user.
• Transparent bidding that lets advertisers see competitor bids.

Let’s dig a little deeper, shall we?

How ad exchanges work

Here’s a simple explanation of how ad exchanges work with real-time bidding (RTB):

1. Publishers make their inventory available to an ad exchange through an SSP, with details such as their location, audience, etc.
2. The auction starts when a user lands on the web page or app. User data is collected and sent to the ad exchange.
3. The ad exchange sends a bid request to the DSPs in its realm.
4. After analyzing the bid request (information related to the user impression such as the demographics, geolocation, targeting, etc.) the DSP decides whether it is beneficial for the advertiser to bid on the impression. Then, the maximum bid amount is sent to the ad exchange.
5. Finally, the ad exchange picks the highest bid, and the advertisement creative is shown to the user on the publisher’s web page or app.

Sounds simple, doesn’t it? Besides, this complex process occurs in no time, delivering results to both advertisers and publishers in the blink of an eye.

Now, let’s look at the top ad exchanges for advertisers and publishers.

Top 5 ad exchanges in India

Below are the top five ad exchange companies in India and their features.

Google Ad Exchange

Popularly known as Google AdX and previously called DoubleClick Ad Exchange, Google Ad Exchange is a sub-product under Google Ad Manager. It offers premium demand and better control to publishers, and a large pool of impressions to advertisers via real-time bidding.

OpenX

An optimized programmatic ad exchange with a real-time guaranteed (RTG) approach, OpenX ensures publishers and advertisers that impressions are sold for a fixed, fair price without the need for an auction.

Magnite

Earlier called Rubicon Project, Magnite started as a supply-side platform before becoming an ad exchange. It hosts many top publishers and premium advertisers and offers plenty of Programmatic Media Buying (PMP) deals.

PubMatic

is a leading ad exchange platform as a service (PaaS) with more than 100 billion impressions. With support for multiple inventories such as display, video, mobile, and native, it benefits publishers with open-source header bidding. Apart from the standard features of ad exchanges, PubMatic offers advertisers security tools to ensure brand safety.

MoPub

MoPub (now acquired by AppLovin) is a bundle of efficient tools for optimization, management, and reporting. It connects publishers to hundreds of buyers through DSPs and other buying platforms and offers high-grade demand. MobPub features are now unified with AppLovin’s monetization platform - MAX.

To conclude, exchanges are clearly an efficient way for publishers to monetize their inventory and advertisers to grow their audience. The whole process takes place within seconds, transforming the way digital advertising is being carried out.