Industry Execs On Ad Servers And The Value Of Proprietary Tech

adservThere’s no doubting the ad server’s importance in managing digital media.

“It is the central hub for all digital placements, and provides advanced reporting on things like reach & frequency, multi-touch attribution, geo-targeting, time to conversion analyses, and overall media effectiveness,” IPG Mediabrands’ Mitchell Weinstein told AdExchanger.

But how important is it for companies to own their own ad server rather than leasing one? AdExchanger asked a handful of industry vets to weigh in.

Click below to read their responses.

Nick Jordan, SVP of Product, Tapad

"The term ‘ad server’ is used loosely, but in its most literal form, it is the last mechanism engaged prior to an ad being served in a browser. Currently, this is what DFA and Atlas do – not an area that Tapad is investing in today.… In terms of the importance of owning our own ad-serving technology versus buying or partnering, it ultimately comes down to the primary value that the customer needs. Looking at an ad server as a piece of technology that just serves a creative asset, that's not something a company like Tapad would need to build in-house. For us, proprietary [built in-house] technology is focused on developing a richer form of analytics so that it has a native integration with the rest of our technology stack. This is the value-add for customers."

Ben Kneen, Director of Client Success, Yieldex

“It's hard for me to see a world where the ad-serving function isn't a critical component of a digital ad business, if for no other reason than it handles the non-sexy task of targeting and counting toward a billable goal.… I'm not sure I'd be in a hurry to build or own my own ad server unless I had needed some very unique and specific functionality (like connecting into a secure service like a payment system, basing ad selection on some complex search-query parameters, or writing a lot of data to an ad-server cookie) as well as a deep bench of technology folks. I think a lot of publishers who have gone down this road before really haven't been honest with themselves on either the former or the latter. People fool themselves into thinking that building an ad server isn't a big deal, and it's true that the core features of an ad server, like counting and targeting, aren't all that difficult to build. What they overlook is the infrastructure and performance piece, not to mention what it takes to keep your feature set current. That's the real nightmare, and what makes it so difficult to own your own ad server and do it well given the competition. I think you see a lot of publishers walking away from that strategy. Even the guys who were on Dart Enterprise and held on to the very end would rather get on a hosted solution than take it in-house despite the loss of some features.

Natalie Mazer, VP of Strategy and Development, AudienceScience

“In addition to full control in terms of which ads are being served, the ad server also grants full control over ad rotation and sequencing for optimization. Having an ad server as part of the tech stack also allows us to build further capability on top of it. This is important for growing concerns such as fraud protection and viewability, particularly in the video space, where viewability measurement is not available from a third party. It is important [for us to own our] ad server because it provides our clients with full control and transparency into ad delivery and optimization. The other important element is data security. Owning our own ad server provides advertisers with the knowledge that data from advertiser X is not being used by advertiser Y. That kind of unauthorized data sharing is common with traditional third-party ad servers.”

Kunal Gupta, CEO, Polar

“Ad servers are critical to help publishers manage inventory, forecast revenue and generally manage their overall monetization setup. Critical to an ad server is giving the ability for a publisher to understand all types of monetization. I recently met with a comScore Top 50 publisher who shared with me that they have four different ad servers, including one for desktop display ads, another for video ads, another for mobile and a separate solution they are building internally for custom ad formats. An ad server is like a wireless network. You expect top-notch service, high reliability, and all the capabilities that will help you do your day-to-day job. However, value creation is done on top of the infrastructure, not the infrastructure itself. It is not important to own your ad server; what’s more important is creating compelling solutions that solve real market problems."

Michael Connolly, CEO, Sonobi

“The ad server is absolutely essential to the publisher’s technology stack… [but] unless you are one of the major publishers, [owning an ad server] is not advised. The ad server is becoming more streamlined in its ability to integrate with other technologies. Many of these integrations are becoming standardized. Maintaining your own server outside this ecosystem makes it difficult to benefit from standardization in the market. In addition to this, owning your own ad server requires an extraordinary amount of resources. You would need a really compelling business case to make the commitment to operate a 24/7 ad-serving infrastructure.​”

 

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