The answer to the question “What is an Ad Server”, when put in a phrase, is a platform that helps you serve ads. But we all know that we need more than this to get a clear understanding of what an ad server is and how it works!

Luckily, this read is all you’re going to need, ever! We’ve covered everything you need to know about an ad server and its basics like how an ad server works and the different types of ad servers available today!

So, without any further delay, let’s get started! 

What Is An Ad Server?

An Ad Server is nothing but an AdTech (advertising technology) that lets you run and manage online advertising campaigns. The ad server hosts the ad information and delivers them to platforms like websites and mobile applications. Used by ad agencies, publishers and advertisers, ad servers have revolutionized today’s online advertising industry.

One major reason would be the ability of ad servers to cover your entire digital marketing efforts – includes media planning, ad targeting, optimization, and more. Some of the most common ad servers used today are Google Ad Manager, Verizon Media, Smart Ad Server, and more.

Quick Statistic: During the year 2020, the leading publisher of the ad serving industry was DoubleClick with 4.93 million websites. 

Now that we know what an ad server is, let’s get to know how an ad server works post which we’ll be looking at the different types of ad servers (would be more appropriate this way)! 

How Does An Ad Server Work?

It’s pretty simple, 

  • John enters a website 
  • The website sends an ad request to the ad server
  • And then the ad is displayed to John

Well, that’d be the initial outline but let’s get a bit in-depth! 

The entire ad serving process can be divided into three simple steps (we’ll be keeping it simple and eliminating programming stuff).

What is Ad ServerHow it Works

What is Ad ServerHow it Works

Step 1 – Invoking the Publisher Ad Tag

Every site has its webpage content stored on a server and it is available to users when they visit the site. Now when the publisher has planned to run ads, the webpage will have certain containers (empty spaces) for the ads to be displayed! 

When a visitor enters the website (publisher’s site), the ad tag within the empty placeholder (formally called the ad unit) sends a request to the ad server. Once this is done, the ad server acts on the request. 

This is an example of an ad tag from Doubleclick

ad tag example

                                                         (Image Source: Adopsinsider)

If you want to know more about DoubleClick ad tags and how they are built, this read explains it all

Step 2 – Ad Selection Process

Once the request is received, the advertiser’s ad server chooses which ad should be displayed. The ad that is to be displayed is chosen based on factors like

  • Which ad campaign has the least time left
  • Which ad delivers the most ctr (click-through rates) or high conversion rates. 

Recently, ads are being delivered based on the type of users that visit the website – this helps increase relevancy and click-through rates. 

Step 3 – Ads Being Displayed

This is where the chosen ad is displayed to the visitor. Once the ad is chosen, the same is being sent to the publisher’s ad server. On receiving the ad creative, the same is displayed on the particular ad unit.

So, that’s pretty much your answer to the question “how does an ad server work”.

Let’s get to know about the types of ad servers! 

Types of Ad Server:

1. First Party Ad Server

The first-party ad server is where the publisher gets to manage the ad units on their website. The ads managed here are the ones sold to the advertiser via direct campaigns. First-party ad servers carry out multiple functions like deciding what ads to be displayed (based on set parameters), acquisition and display of data like ad impressions, CTR, etc making it a complete advertising solution!

The advantage of using a first-party ad server is that ad-blockers don’t take much effort to block a request that comes from the first-party domain. And advertisers find it easy to work on multiple user clusters at the same time. 

2. Third-Party Ad Server

A third-party ad server is nothing but an ad-tech company that is an expert in carrying out online advertising activities (serving, managing, and reporting). 

The ad tech company (the third party) will not be having any direct access to the ad serving website. They only provide ad creatives here thus giving them the name “Advertiser-side server”. 

The benefits that come along when a third-party server is used are the crystal clear analytics (CTR, conversions, etc) that allows you to make more informed decisions when you want to optimize an ad campaign. Also, third-party ad servers are highly reliable and extremely cost-effective these days. 

3. Open-Source Ad Server

As the name says, open-source ad servers are ad server scripts that are available to download (for free) from a third-party source. Once downloaded, you’ll be hosting it on your servers. Open-source ad servers are also known as self-hosted ad servers.

In this model, you’ll have to take care of everything right from the server costs, bug fixing, and maintenance costs. The only advantage here would that no data will be sent to a third party.

Best Practice For VOD Monetisation With Ad Insertion

Let’s just say it! The reason why you or everyone wants to run a VOD platform is to earn money. And ad insertion on your VOD platform is one the best ways to earn some money!

Speaking of ad insertion on VOD platforms, you can get this done in two ways. Using the 

  1. The traditional Client-Side Ad Insertion
  2. Highly pursued Server-Side Ad Insertion

When it comes to monetizing your VOD platforms with ads, it’s best if you use the SSAI method (server-side ad insertion).


Because when you use the CSAI method, ads are pre-loaded and end up not being displayed due to adblockers! This is one main reason why the Client-Side Ad Insertion method is losing traction. Also, maintenance is quite high when compared with the latter.

Whereas, when you use the server-side ad insertion method, ads are displayed dynamically based on user behavior making it more relevant! Also….wait! 

Let’s not look at all the pros here! Let’s get to know what server-side ad insertion is and then move on to the benefits!

Server-Side Ad Insertion for VOD

Server-Side Ad Insertion allows streaming websites to monetize their videos by inserting video ads during the video runtime. And viewers get to see ads that are targeted based on device, content, and location.

Here are a few benefits of using SSAI

  • Seamless tv-like experience to your users
  • Client-side player implementation paves the way to less code implementation
  • The minimum CPU and network usage promotes a better user experience
  • Decreases buffering instances as ad requests are placed 

When an ad is about to be displayed, the streaming server will put out a request asking the ad server as to which ad should be displayed. And the ad server will respond with a video that it thinks is suitable. 

The streaming server will then add the particular video to the content and make it as one continuous stream – as simple as that. 

Said even simple, it is Video Stream + Ad Stream together!

P.S. If you’re in the planning phase and you’re about to start a VOD platform, you should check out our solutions – easy, affordable and super cool!

Quick Summary 

You should now be knowing what is an ad server and how does an ad server work. We’ve also come across the types of ad servers and their benefits.

Since most of the ad servers today are advanced and carry out all functions, it’s totally up to you to choose an ad server for your ad campaigns. Also, speaking of ad servers, here are some of the best third-party ad servers you might find useful!

And with that said, we’re wrapping up now! If you haven’t started displaying ads yet, it’s high time you get started now because it’s lucrative and who would say no to a couple of quality leads?