The ad tech glossary

309 terms, each answered in one sentence, then explained properly with an analogy and a worked example.

All Basics Programmatic Invalid traffic & fraud Measurement Data & identity Privacy & regulation CTV & video Mobile & app Retail & commerce Formats & creative Business & finance Search & social Supply chain Audio & DOOH

A

Ad call: An ad call is the HTTP request an ad tag makes asking an ad server or partner to return an ad; it is often a synonym for ad request.
Ad exchange: An ad exchange is a digital marketplace where buyers and sellers of ad impressions meet and trade through automated auctions, usually in real time.
Ad request: An ad request is the signal a web page, app or video player sends to an ad server or ad platform asking for an ad to fill a specific slot.
Ad server: An ad server is the software that stores ads, decides which ad to show in each slot based on rules and priorities, delivers it, and counts impressions and clicks.
Ad tech tax: The ad tech tax is the combined share of an advertiser's spend taken by intermediaries, such as agencies, DSPs, data providers, verification vendors and SSPs, before the rest reaches the publisher.
Advertiser ad server: An advertiser ad server is the system brands and agencies use to host their ad creatives centrally, serve them into publishers and DSPs, and track delivery and results across all of them.
Auction dynamics: Auction dynamics are the rules and behaviours that decide who wins programmatic ad auctions and at what price, including auction type, floors, fees, bid shading and bid order.
Auction timeout: An auction timeout is the maximum time an auction waits for bids; responses that arrive after it are ignored, even if they would have won.

B

Bid duplication: Bid duplication happens when the same ad impression reaches a buyer through several SSPs or resellers at once, so the buyer may bid against itself and waste processing and budget.
Bid landscape: A bid landscape is an estimate of how many impressions a buyer could win, and at what cost, at different bid prices for a given audience or inventory.
Bid request: A bid request is the message an SSP or exchange sends to potential buyers describing an available ad impression, inviting them to bid on it in a real-time auction.
Bid response: A bid response is a buyer's reply to a bid request, containing its offered price and the ad (or a link to it) to show if it wins.
Bid shading: Bid shading is a technique DSPs use in first-price auctions to lower a bid automatically toward the price actually needed to win, so advertisers do not overpay.
Bidstream: The bidstream is the continuous flow of bid requests and responses exchanged in real-time bidding, and the data they carry about sites, apps, devices, locations and users.

C

Curation: Curation is packaging inventory from many publishers, often combined with audience data and quality filters, into ready-made deals that buyers can purchase through their DSP.

D

Deal ID: A deal ID is a unique code in a bid request telling the buyer's DSP that the impression belongs to a specific pre-agreed deal, such as a PMP or programmatic guaranteed.
Demand path optimization: Demand path optimization (DPO) is a publisher's or SSP's practice of prioritising the buyers and routes that deliver the most value, and cutting those that add cost without adding demand.
DSP (demand-side platform): A DSP (demand-side platform) is software that advertisers and agencies use to buy ad impressions automatically across many exchanges and publishers, deciding which impressions to bid on and how much.
Dynamic allocation: Dynamic allocation is a Google Ad Manager feature that lets Google's ad exchange compete in real time against a publisher's other non-guaranteed campaigns for each impression.

F

First-price auction: A first-price auction is an auction in which the highest bidder wins and pays exactly what they bid, which is now the standard model in programmatic advertising.
Floor price (reserve price): A floor price is the minimum bid a publisher will accept for an impression; bids below the floor are rejected, even if they are the highest bid in the auction.

H

Header bidding: Header bidding is a technique where a publisher offers each ad impression to many SSPs and exchanges simultaneously before calling its ad server, so all buyers compete at once.

L

Last look: Last look is an auction advantage in which one bidder sees the best competing bid before bidding, so it can win by bidding just slightly more.
Latency: Latency is the time delay between a request and a response; in advertising, it is how long auctions, ad servers and creatives take to return and display an ad.

M

Managed service: Managed service is an arrangement in which an ad tech vendor's own team runs campaigns on the client's behalf, usually for a higher fee than using the platform self-serve.

O

Open auction: An open auction is a real-time programmatic auction in which any approved buyer connected to an exchange can bid on a publisher's impressions, without a pre-arranged deal.
OpenRTB: OpenRTB is the open technical standard, maintained by IAB Tech Lab, that defines how bid requests and bid responses are formatted and exchanged in real-time bidding.

P

Prebid: Prebid is the most widely used open-source header bidding software, including Prebid.js for websites, Prebid Server for server-side auctions and Prebid Mobile for apps.
Preferred deal: A preferred deal gives one buyer the first chance to buy a publisher's impressions at a fixed, pre-agreed price, with no obligation to buy and no guaranteed volume.
Principal-based buying: Principal-based buying is when an agency buys media for its own account and resells it to clients at a price it sets, instead of buying at cost as the client's agent.
Private marketplace (PMP): A private marketplace (PMP) is an invitation-only programmatic auction in which a publisher lets a selected group of buyers bid on specific inventory, usually with a floor price, via a deal ID.
Programmatic guaranteed (PG): Programmatic guaranteed (PG) is a deal in which a buyer commits in advance to buy a fixed volume of impressions at a fixed price from a publisher, delivered through programmatic pipes.
Publisher ad server: A publisher ad server is the system a website, app or streamer uses to manage its ad inventory and decide, for every ad slot, which campaign or programmatic buyer gets the impression.

R

Real-time bidding (RTB): Real-time bidding (RTB) is an automated auction in which advertisers bid on a single ad impression in the fraction of a second while a web page, app or stream is loading.

S

Second-price auction: A second-price auction is one in which the highest bidder wins but pays just above the second-highest bid (or the floor), which was the original standard in real-time bidding.
Self-serve platform: A self-serve platform is an ad buying or selling tool that customers operate themselves through a web interface or API, without the vendor's staff running campaigns for them.
Server-side header bidding: Server-side header bidding runs the header bidding auction on a remote server rather than in the user's browser or app, reducing page weight and latency while connecting to more bidders.
SSP (supply-side platform): An SSP (supply-side platform) is software that publishers use to sell their ad inventory automatically to many buyers, running auctions and managing prices, deals and quality controls.
Supply path optimization (SPO): Supply path optimization (SPO) is a buyer's practice of choosing the most direct, cheapest and most trustworthy routes to the same inventory, and cutting unnecessary resellers and duplicate paths.

T

Take rate: Take rate is the percentage of the money flowing through an ad tech platform that it keeps as its fee: platform revenue divided by the gross spend it handles.
Trading desk: A trading desk is a specialist team, usually inside an agency or advertiser, that plans and executes programmatic buying on DSPs on behalf of campaigns and clients.

U

Unified auction: A unified auction is a single auction in which all demand sources, such as direct campaigns, header bidders and exchanges, compete for an impression under the same rules at the same time.
Unknown delta: The unknown delta is the share of programmatic ad spend that could not be traced or attributed to any identifiable fee or publisher payment in the 2020 ISBA/PwC supply chain study.

W

Waterfall (daisy-chaining): A waterfall is an older way of selling ads in which an impression is offered to demand partners one at a time, in fixed priority order, until one fills it.
Win rate: Win rate is the percentage of bids a buyer submits that actually win the auction, calculated as auctions won divided by bids placed, multiplied by 100.