What Are Ad Networks – The Ultimate Guide to Making Money From Ad Networks [PART 1] 2

What are Ad Networks

We’ve set out to dimistify the ad networks and tell exactly how and why they can help you earn money as a publisher.

Before we get into the thick of it, however, it’s important to know what ad networks are and how they operate.

What Are Ad Networks

Online advertising networks are companies which specialize in connecting advertisers to online publishers – people who own and maintain web property such as sites, news outlets, or blogs and are willing to host advertisements on them.

The principal function of an ad network is the accumulation of that ad hosting space and filling it with relevant ads – matching supply with demand so to speak.

How Ad Network Works

 

Why Ad Networks

There are two reasons why ad networks are necessary for today’s online business and marketing efforts.

Primarily, businesses need to advertise their products and services in the online space in order to generate leads and sales.

No marketing professional wants to lose countless hours searching the Web, trying to find optimal placement spots for their ads on different sites.

Such manual attempts at piecing together ad space inventory would take forever and are not cost-effective or efficient.

From a publisher’s point of view, hosting ads on their sites is a great way of generating passive online income as all those ad impressions are paid for.

Again, site owners looking to partner with individual companies whose ads they would then show is a tiresome task that involves a lot of back and forth and doesn’t guarantee that they will sell their entire ad space inventory or get paid for showing those ads.

That’s where ad networks step in.

They bridge the gap, allowing both publishers and advertisers to streamline their operations by taking on the responsibility of matching various ads with available ad space that they have accumulated and making sure that those ads are displayed on relevant pages where they will be seen by people who are interested in them.

The First Ad Network

As we’ve mentioned, ad networks developed out of necessity.

Businesses wanted to scale up their online marketing efforts without having to deal with publishers directly and they needed access to that fast-growing slew of websites that were popping up in the mid 90’s.

The first and largest ad network was DoubleClick. Founded in 1996, it took advantage of the apparent need for a middleman in the online ad buying/selling industry by brokering deals between large advertisers and thousands of smaller publishers and taking a cut of the profits.

But DoubleClick didn’t just connect the two – they operated a platform that automated the entire process of serving ads, providing cutting-edge monitoring and reporting features that set the standard for all future ad networks.

To this day, ad networks that can boast great tracking, reporting, and optimization features fare a lot better than those who can’t – they’ve become an operating standard that both advertisers and publishers depend on.

DoubleClick managed to survive the dotcom bubble of 2000 and was bought out by Google in 2003.

Ad Network Survided 2000 bubble

Today, it’s rebranded and known as DoubleClick Ad Exchange, Google’s product that connects agencies, ad networks, and platforms and has a huge real-time online inventory of ad space and ads.

How Ad Networks Work

The back-end process is quite complicated but what’s important for publishers is that ad networks take care of the bulk of actions and technicalities required for them to show ads on their sites and make money from those ads.

Advertisers pay ad networks to run their ad campaigns and match their ads across the publishers’ websites that they work with. As a publisher, you will get paid in one of two ways:

Ad Netowrk Cost Per Click Cost Per Mile. CPC CPM

  • Cost per mile – you get paid per impressions, mile being 1,000 ads showed on your site, no further action necessary. If CPM is $10, it means that you will get paid 1 cent per shown ad. This is a model that heavily favors you as a publisher since you’re not taking the risk associated with a bad creative delivered by the advertiser – you get paid regardless of whether your visitors click on the ad or not.
  • Cost per click – you get paid per click. This is a market that favors the advertiser because you will only get paid once a click is made on an ad that is shown on your site.

As a site owner, you will have to apply to get access to an ad network and become a publisher.

While premium networks have rigorous standards that webmasters have to meet in order to qualify, there are networks which are not overly picky.

However, to get access to any of them you will have to:

  • Regularly publish informative and visited content
  • Have a decent amount of traffic – the more the better, for both you and the advertisers
  • Follow ad network guidelines

Once you get accepted to an ad network you will have to place ad tags on parts of your website you want to monetize.

Those will become ad zones – places where the network will show ads on your site.

Ad tag is a simple piece of code – the means to identify that zone and to track everything associated with ads shown and clicks originating from your site. This forms a basis for the calculation of your payment.

Ad Network Codes

 

Regardless of how you’re paid, per click or per mile, ad network will accumulate your earnings and pay you out once or twice a month, depending on their terms and conditions.

If you’re a premium publisher earning the ad network a hefty income you will often get an opportunity to get paid once a week or even biweekly.

Payment options vary, but most ad networks today will pay you through PayPal or an equivalent service, such as Payoneer, Skrill, Rapida, and others. Some also let you choose wire transfer or check as your preferred method of payment.

 

  • http://www.donnamerrilltribe.com/ Donna Merrill

    Hi Abe,

    Thank you so much for explaining how Ad Networks work! I get emails a lot from people who want to put an ad on my blog. I’m always refusing. Guess I have been in my box and not out of it. Hmmmm This is something to think about.

    When I’ve seen other folks trying to explain this, it was a turn off for me, but you hit a home run here and made it easy to understand. Also giving value to both sides. I have a new outlook on this now. Many thanks Abe!

    -Donna

    • http://multiplestreammktg.com Abe Cherian

      Hi Donna, glad that you liked it. Most people start a blog to spread their message and their passion. But after a while, one needs to monetize on the traffic. Thanks for the feedback!