Ad exchanges like OpenX Market provide a single point for buyers to buy display, mobile, and app inventory across hundreds of thousands of sites. Reach hundreds of millions of unique visitors globally, in real-time. These real-time ad exchanges also enable sellers to sell their inventory at higher rates.
How It Works
When users visit a website, the ad exchange conducts auctions between multiple buyers for impressions on that site. The buyers bid for those impressions based on the value of the users (behavioural and demographic data), the context in which the ads are shown (e.g. the subject matter of the website) and the types of ad unit (dimensions, scope for rich media). The highest paying buyers win the auctions and it is their creatives that are shown to website visitors. This whole auction process takes place in milliseconds, which is why the process is referred to as “real-time."
Note that the data made available to buyers bidding may be owned by the ad exchange itself, or provided by a third-party partner. The provision of impression-level data to buyers enables them to accurately value the impression.
Using Competition to Increase Yield
By selling through an auction mechanism, exchanges encourage buyers to compete with one another, driving up the value of ad space. An ad exchange maximizes the value of each and every impression passed through it, comparing buyers who might be bidding on very different criteria, to ensure the seller gets the best price for their ad space.
This is different from ad networks, who often sell at a lower eCPM in order to close high volume sales, or may not be in a position to quantitatively compare two ad buy offers (for example, between an buyers that wants to buy a 1 million impressions of “male audience aged 18-25” with another buyers who wants to buy 5,000 clicks from “sports fans on the West Coast”).
A More Efficient Way to Buy
Ad exchanges like OpenX Market let buyers dynamically set bid prices in real-time, offering them the opportunity to optimize their return on ad spend based on actual campaign performance. This is a huge opportunity for buyers. With this real-time approach to optimization, buyers can dynamically reallocate budget based on actual ad performance.
This gives ad buyers greater confidence, which in turn encourages them to pay higher rates for ads bought through exchanges. For example, buyers setting their bids in real-time on the OpenX Market bid on average 141% higher than those who set their bidding rates / rules in advance. And since ads are sold in real-time, less technology is required to forecast inventory and manage over and under-selling. This reduces administrative costs and leaves sellers with a bigger share of every ad dollar spent.
Price Protection(TM)
Some ad exchanges (including the OpenX Market) enable sellers to set a "minimum price": this means that the exchange will only sell impressions if it can pay the seller minimum. (If not, the sellers can sell the ad to a backup ad network.) This removes the risk of adding an ad exchange to a seller's revenue strategy, as the net effect on sellers ad revenue can only be positive.
Next Steps for Sellers
To capitalize on these opportunities, sellers should make all their non-guaranteed inventory available on an ad exchange. To streamline the entire ad serving and revenue optimization process, many sellers also use the OpenX Enterprise ad server, which integrates directly with OpenX Market. With one click sellers can make their unsold inventory available to buyers bidding on a real-time basis.
