Key Points

  • An open ad exchange is not exactly a type of ad exchange. It's more like a type of deal available on ad exchanges.
  • Most ad exchanges are open.
  • Open ad exchanges offer access to broad demand, but they aren't the only type of ad exchange.

Ad exchanges have always been complex parts of the publisher ad tech stack, but since most of them have been absorbed by supply-side platforms (SSPs) and other tools, they're even more difficult to understand than ever. However, understanding ad exchanges is key to taking advantage of their ad revenue-boosting benefits.

So before jumping too deep into associated topics such as header bidding, open bidding, and additional programmatic techniques, one must first understand what an ad exchange is, and one of the first steps to understanding ad exchanges is understanding that there are different types. The most common type of ad exchange you should know is the open ad exchange. What is an open ad exchange? That's precisely what we cover in the article below. Keep reading.

If you're thinking about ad exchanges, you're thinking about your ad revenue. Wish you could think less about it and earn more of it? You can. We'll make it happen. Contact Playwire.

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Ad Exchange Guide

Ad Exchanges: The Complete Guide for Publishers

Open Ad Exchange Defined

As you're researching ad exchanges within the advertising space, you will see "open" ad exchanges discussed as if they are a distinct type of ad exchange, but that's not quite right. It's easier to talk about them in that way, but the term "open" is really referring to a type of deal available inside ad exchanges.

So, here's the real definition of open ad exchange:

What is an open ad exchange?

Also known as an open auction or open marketplace, an open ad exchange is an ad exchange that allows nearly any buyerto purchase publishers' digital ad inventory (thus the term "open"). Most ad exchanges support open deals, but they often also have other capabilities that differ from open deals. 

An Important Note About Open Ad Exchanges

We defined open ad exchanges above for clarity's sake, but the truth is that you aren't likely to find open ad exchanges if you're just Googling them. That's because the vast majority of ad exchanges of all kinds have been absorbed by an SSP, an ad server, or some other combination of tools, all rolled into their offerings.

In other words, ad exchanges are more often a part of a package than they are a standalone product. Still, understanding the various ways they can work can help you make an informed decision as you move forward.

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Ad Exchange Resource Center

Check out all the available resources in The Complete Ad Exchange Resource Center

Benefits of Open Ad Exchanges

Why should you consider open ad exchanges as you build or improve your revenue strategy? There are a few reasons, but most of them have to do with generating more demand for your most premium inventory. 

Here are some of the benefits of open ad exchanges:

  • Your ad inventory gains wide exposure to a huge number of potential buyers.
  • You retain control over price floors and various other factors.
  • You can plug more than one exchange into your programmatic advertising process until you reach the desired level of programmatic demand.

Alternatives to Open Ad Exchanges

While open ad exchanges do have benefits for most publishers, they aren't the only available type. Also, due to their open nature, these exchanges are sometimes plagued by ad fraud and similar concerns. 

The good news is that there are some alternatives for you to consider:

  • Private marketplace (PMP). PMPs are often referred to as private exchanges, but like open ad exchanges, they aren't really a type of ad exchange but are more like a type of deal available on ad exchanges. In these private marketplace deals, only certain publishers and advertisers are allowed to participate. This selectivity gives more reassurances against ad fraud, and it can drive CPMs much higher. However, the reduced number of buyers means reduced exposure to demand overall.
  • Preferred deal exchanges. Preferred deals are when publishers create a shortlist of buyers who are allowed to purchase their inventory. This is among the most exclusive types of deals, so CPMs can be quite high. However, you have to be a relatively well-known premium publisher to get any buy-in from publishers who might want to be on your shortlist.

Keep in mind that these are not binary choices you have to make between open ad exchanges and PMPs or other options. You can - and likely should - incorporate some of each type of demand source into your strategy until you have reached the optimal level and types of demand.

Need Help Getting More Demand?

Open ad exchanges are all about broadening the demand for your inventory. How you incorporate them into your revenue strategy will depend on your unique needs and goals. But at the end of the day, it's about leaving no ad impression unsold and getting the highest possible price for each one.

While open ad exchanges aren't essential to making that happen, they are usually a part of it in some way. If you're feeling a little lost and simply looking to drive your revenue higher - whether that involves partnering with ad exchanges or not - we can help. The Playwire team has been doing this for publishers for more than 15 years, and we can do it for you, too.

Interested? Reach out to our team of ad tech experts.

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