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AdTech: What it is and How it works (2024 Guide)

Advertising technology, also known as AdTech (advertising technology), has become a crucial component in the world of advertising. guerrilla marketing and advertising for brands . Its fundamental role is to facilitate and optimize the purchase and B2B sales of online advertising spaces, with the aim of reaching specific audiences more effectively.

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What is AdTech?

AdTech, or advertising technology, refers to the set of technological tools and platforms used in the field of digital advertising. These technologies are designed to optimize and improve the way information is created, delivered, and analyzed. native online advertising . AdTech encompasses a wide range of tools and services that facilitate the planning, purchasing, monitoring and optimization of digital advertising campaigns. For them, we use programmatic platforms. They allow us to automatically buy and sell advertising spaces in real time. Advertisers use algorithms and data to make instant decisions about ad placement. Ad networks connect advertisers and publishers, making it easy to distribute ads across multiple websites. These networks often use algorithms to assign advertising to relevant spaces. DMPs collect, store and analyze audience data. Advertisers will use this information to segment audiences and personalize their advertising strategies .

Origin of AdTech

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The origin of AdTech dates back to the early stages of online advertising, which began in the early 1990s with the advent of the Internet. Here are some key phases in AdTech development.

1990s – Emergence of Online Advertising

In the early days of the Internet, the Online programmatic advertising was rudimentary Static advertising banners were some of the first formats used to attract users’ attention.

Cookies and User Tracking (Mid-1990s)

As online advertising evolved, cookies were introduced, allowing user behavior to be tracked on the web. This provided advertisers with valuable data about users’ online preferences and activities.

Development of Advertising Technologies (Late 1990s)

In the late 1990s, companies specialized in the development of more advanced advertising technologies emerged. These technologies included tools for campaign management, conversion tracking, and ad optimization.

Expansion of Advertising Platforms (Early 2000s)

With the growth of the Internet and the increase in the number of websites, online advertising platforms were developed and popularized that allowed advertisers to reach specific audiences more effectively.

Adoption of Programmatic Advertising Models (2010 onwards)

The 2010s saw the widespread adoption of programmatic advertising, which enabled the automated buying and selling of advertising space in real time. Programmatic advertising uses algorithms to efficiently bid and place ads.

Rise of Personalization and Segmentation (2010s)

With the availability of richer data and advanced analytical capabilities, AdTech enabled greater ad personalization and targeting. Advertisers could target specific audiences based on demographics, online behaviors, and other criteria.

Importance of Ad Tech for brands

AdTech is essential for brands in the digital age, offering advanced tools that transform advertising into a personalized and efficient experience. It allows brands to precisely segment audiences, optimize campaigns in real time, and measure performance with detailed analytics. Not only does it improve media buying efficiency and international scalability, but it also contributes to an improved user experience by personalizing content and messaging for good early adopters in brands . By embracing technological innovation, such as artificial intelligence and augmented reality, brands are able to stay ahead, offering more effective advertising campaigns and building more meaningful connections with their consumers. In short, AdTech is a critical element for brands looking to stand out and thrive in today’s competitive digital landscape.

How does Ad Tech work?

AdTech operation involves a combination of technologies and processes designed to optimize the purchasing, delivery and analysis of online advertising. Here’s an overview of how it works:

Data collection

AdTech starts by collecting relevant data about users. This data may include demographic information, browsing behaviors, search history, and preferences. Technologies such as cookies and tracking pixels are commonly used to collect this information.

Data Management Platform (DMP)

The collected data is stored and managed in a Data Management Platform (DMP). The DMP organizes information and makes it accessible to advertisers, allowing them to perform analysis and segment audiences more effectively.

Audience Segmentation

Using DMP information, advertisers can segment their audiences into more specific and personalized groups. This allows the delivery of more relevant ads to users with specific characteristics and behaviors.

Programmatic Platforms

Programmatic advertising is a key component of AdTech. Programmatic platforms allow for the automated buying and selling of advertising space in real time. Advertisers use Demand-Side Platforms (DSP) to bid on advertising space, while publishers use Supply-Side Platforms (SSP) to make their advertising inventory available.

Real Time Auctions

In a real-time auction, advertisers compete for the opportunity to show their ad to a specific user. AdTech uses algorithms to determine which ad will be shown and at what price, based on criteria such as relevance, quality, and monetary supply.

Ad Delivery

Once the auction has taken place, the winning ad is delivered to the user in the corresponding advertising space, whether on a website, app, or other digital environments. Delivery can occur in a variety of ways, including banners, videos, native ads, among others.

Real Time Optimization

During and after delivery, AdTech tracks ad performance. It uses real-time data to optimize the campaign, adjusting the delivery strategy to maximize effectiveness and achieve the objectives set by the advertiser.

Analysis and Reporting

AdTech provides advanced analytical tools that allow advertisers to analyze the performance of their campaigns. These analyzes include metrics such as impressions, clicks, conversion rates, and return on investment (ROI), making it easy to evaluate and make informed decisions.

Difference between AdTech and Martech

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AdTech (Advertising Technology)

Main goal

The main objective of AdTech is to facilitate the purchase, delivery and optimization of online advertising. It focuses on reaching specific audiences and generating interaction with users through digital ads.

Principal functions

AdTech specializes in media buying automation, audience segmentation, programmatic ad delivery, real-time optimization, and performance analysis of digital advertising campaigns.

Examples of AdTech Technologies

Demand-Side Platforms (DSP), Supply-Side Platforms (SSP), Ad Networks, Data Management Platforms (DMP), conversion tracking and analysis technologies, among others.

Searched Results

AdTech seeks measurable results in terms of visibility, clicks, conversions and return on investment (ROI) in the field of digital advertising.

Martech (Marketing Technology)

Main goal

Martech focuses on the broader set of technologies used to improve and automate overall marketing activities. This encompasses strategies that go beyond advertising, such as customer relationship management (CRM), content marketing, marketing automation, and analytics.

Principal functions

Martech includes technologies for marketing campaign management, customer data analysis, workflow automation, content management, social media strategies, marketing analytics, and customer experience optimization.

Examples of Martech Technologies

Marketing Automation Platforms, CRM Software, Web Analytics Tools, Content Management Platforms (CMS), Social Network Management Tools, among others.

Searched Results

Martech seeks results that go beyond digital advertising metrics, including customer retention, customer satisfaction, brand loyalty, efficiency in marketing campaign management, and continuous improvement of the customer experience.

Benefits of implementing AdTechs

Precise Segmentation

AdTech enables detailed audience segmentation based on various criteria, such as demographics, online behaviors, browsing history, and preferences. This ensures that ads are delivered to people who are most likely to be interested in the product or service.

Real Time Optimization

Advertising technology enables real-time optimization of advertising campaigns. AdTech algorithms and platforms constantly analyze campaign results and automatically adjust ad delivery to maximize performance.

Results measurement

With AdTech, advertisers can accurately measure the performance of their advertising campaigns. Detailed data can be obtained on impressions, clicks, conversions and other key indicators, making it easy to evaluate return on investment (ROI) and make informed decisions.

Efficiency in Media Buying

Automating media buying (programmatic) through AdTech improves the efficiency of the process by eliminating intermediaries and optimizing the allocation of advertising resources. This results in greater transparency and reduced operating costs.

Content Personalization

AdTech allows the creation of highly personalized ads. By understanding user behavior and preferences, advertisers can deliver targeted and relevant messages, increasing the likelihood of generating engagement and conversions.

Improved User Experience

By focusing on delivering relevant ads, AdTech contributes to improving the online user experience. This reduces the feeling of intrusion and improves the overall perception of advertising.

Scalability and Global Reach

AdTech allows advertisers to reach audiences on a global scale efficiently. Programmatic platforms and ad exchange networks facilitate the expansion of advertising campaigns internationally.

Success stories in AdTech

There are numerous success stories in the world of AdTech, where companies and advertisers have taken advantage of these technologies to achieve notable results in their semi-advertising campaigns . Here are some examples:

Coca-Cola Programmatic Campaign

Coca-Cola launched a Christmas campaign for programmatic brands using AdTech technologies to personalize ads based on demographics, location and online behaviors. This resulted in a significant increase in user engagement and improvement in key metrics.

Spotify and Contextual Advertising

Spotify uses AdTech to serve ads contextually, taking into account the time, location and mood of the user. This has led to greater ad relevance and higher user retention on the platform.

Nike Campaign with Augmented Reality

Nike incorporated augmented reality (AR) technology into a digital advertising campaign. Users could view products in 3D, try them on virtually, and make purchases directly from the ad. This innovative strategy improved engagement and drove conversions.

Airbnb campaign on Instagram

Airbnb used native advertising on Instagram to reach specific audiences with visually appealing content and personalized messages. This strategy contributed to increased brand awareness and community engagement.

Amazon Retargeting Campaign

Amazon is known for its effective retargeting strategy using AdTech. Users who have visited products on the Amazon website often see related ads on other sites, which contributes to conversion and customer retention.

McDonald’s campaign on Waze

McDonald’s used navigation platform Waze to launch a location-specific advertising campaign. The ads were shown to drivers near McDonald’s restaurants, resulting in an increase in visits to the stores.

Spotify Personalization Campaign

Spotify uses AdTech to deliver personalized playlists and targeted ads based on each user’s music tastes and listening behavior. This personalization improves the user experience and the effectiveness of the ads.

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Conclusion 

In conclusion, AdTech (Advertising Technology) has revolutionized the marketing and advertising industry by providing advanced tools that allow brands to reach specific audiences more effectively in the digital environment. Precise targeting capabilities, media buying automation, content personalization, and real-time optimization have led to more efficient and results-oriented advertising campaigns.

The constant evolution of AdTech, integrating technologies such as artificial intelligence, augmented reality and advanced analytics, has led to more innovative and interactive advertising strategies. Additionally, the ability to measure performance in real time and perform detailed analysis has provided advertisers the ability to make informed decisions, adjust strategies, and continually improve.

AdTech has not only improved media buying efficiency and international scalability, but has also contributed to an improved user experience by personalizing messages and ads. As brands continue to leverage these technologies, AdTech continues to play an essential role in building strong relationships with consumers and successful marketing strategies in the ever-evolving digital age.

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