This is the first of a many-parts series of articles on Internet advertising technology. Or AdTech, for short. This is not an especially well covered topic online, so perhaps this will be useful to people.
My intended audience is tech focused people just starting in AdTech. This means developers, designers, product managers, UX researchers etc. Hopefully it’s a good refresher for more knowledgeable people as well. It’s by no means complete or perfect.
We all have an intuitive understanding of what advertising is. It is a form of communication where one party tries to convince another party of something. We call the first party the advertiser, while the second the audience. The object in the vast majority of cases is commercial. The advertiser tries to convince the audience to buy a product or use a service. There is also non-commercial advertising, such as political ads or public services announcements. They’re nowhere near as big, though.
Besided advertisers and the audience, there is one third big player in online advertising. Publishers are the party which can get an advertiser’s ad in front of the audience. They do this by already having an audience of their own, to which they show the ads, on behalf of advertisers. In the majority of cases, the publisher is a media organization of some sort, though that is not a hard rule. As such, publishers on the Internet are websites, search engines, social networks, video platforms, mobile applications, podcasts etc. In traditional media, they would be newspapers, radio stations, TV channels etc. While there is some direct communication from advertisers to the audience, the bulk of it is mediated by publishers.
AdTech is the technology of advertising on the Internet. That last bit is crucial. Advertising has always involved a bit of technology. For example, for the printing of newspaper ads or filming of commercials. But, it is only with the rise of the Internet, that the technical component has taken a crucial role. One that warrants a whole engineering discipline dedicated to it. Indeed, some of the largest tech companies in the world make their money from AdTech.
Some peculiarities of online advertising, which set it apart from regular advertising:
- Publishers are used almost universally. Indeed, most of the direct-to-audience advertising occurs when a publisher runs its own in-house ads.
- Each interaction a member of the audience has with an ad can be tracked and measured. This allows for much better reporting and measurement around ad campaigns. It is possible to check that an ad has actually been seen and to quantify the level of interaction with it. Traditional advertising was orders of magnitude less precise.
- There is a wealth of information about each member of the audience available, inferred from their online behaviour. This allows for a much better targeting of ads. Traditional advertising relied on broad properties of the population of audience members seeing a movie or reading a newspaper.
That’s it for this post. Hopefully you’ve begun to have a better appreciation of the topic. There’s still a lot of ground to cover until we reach the tech phase. In the next post we’ll go into more details on the various concepts and standard interactions in AdTech.