What’s Wrong with Ad Exchanges and How Marketers Can Benefit from Programmatic Middleware Alternatives

While ad exchanges have indeed revolutionized the digital advertising ecosystem, it’s impossible to turn a blind eye to all the challenges and limitations associated with the platforms. Let’s see why and where the spotlight is now shifting from ad exchanges and explore the new focal point that emerged in the advertising game.??

So, what’s wrong with ad exchanges??

1. Lack of traffic quality transparency

One of the biggest concerns related to ad exchange platforms is the lack of transparency regarding traffic quality and control over ad placements. With the enormous number of supply sources, advertisers cannot be clear about where the ads are being placed and who the audience is, which makes it very difficult to track and manage campaigns. In ad exchanges, the traffic data can be gathered from the structure of requests and responses moving through the platform. Most ad exchange users are simply unable to process and interpret such information and then analyze it to ensure optimal performance.?

2. High service margins

What’s even more frustrating is the extremely high service margins that ad exchanges impose. Whereas they operate on the real-time auction system and offer ad exchange users fair pricing based on their bids that can be easily adjusted, these platforms still need to generate profit somehow. How do they do this? By simply adding their servers to the supply chain, they inflate prices and introduce additional margin percentages that can reach up to 30%. Such a practice negatively affects traffic monetization and the final win rate.??????

3. Required business development

What they also gloss over when talking about ad exchanges is the fact that substantial time and resource investments in business development will be required to start using ad exchanges. The processes may include performing thorough market research, establishing necessary business contacts, negotiating potential partnerships, and generating leads. These extra efforts can be unbearable for advertisers and publishers seeking a simple and straightforward solution.?

4. Efficiency issues and manual processes

Ad exchange platforms involve a significant amount of manual processes that take up time and budget and distract from focusing on what really matters — monetizing traffic for publishers or maximizing marketing efforts for advertisers. The necessity to deal with invoice distribution, ad exchange user verification, approval, and other manual tasks will reduce publishers' and advertisers' efficiency. Extra integrations to facilitate the workflows are possible, but with solid customization, they again require extra resources.?

5. Legal assistance necessity

Handling the legal side of an ad exchange won’t be possible without an in-house qualified lawyer. Contract review, amendment suggestions, and time-consuming communication with future partners are the legal processes that should be taken seriously and cannot be overlooked.?

Is there any alternative out there??

Due to these limitations, ad exchanges are now facing a decline, creating extra room for ad technologies that promise enhanced functionality. For example, programmatic middleware alternatives are on the rise. What sets them apart from ad exchanges, and why should marketers consider them??

With the advent of platforms such as Axis and other programmatic middleware solutions, marketers have robust alternatives that can mitigate or fully overcome these challenges, introducing a new era of programmatic advertising.?

As solutions like this have extended capabilities, they have more to offer to their platform users. The transparency of programmatic middleware is unparalleled. It allows platform clients to see all the details about their future partner, traffic type, and ad offerings, thus enabling them to seamlessly establish new contacts that match their goals.

Furthermore, most of the manual processes inherent in ad exchanges that require extra resources, such as tedious contract management, can be fully streamlined and automated for publishers' and advertisers' benefit.??

Programmatic middleware also effortlessly expands the client base from both the supply and demand sides, maximizes trading efficiency, improves campaigns with AI-powered insights, and more.?Such platforms usually feature user-friendly and intuitive interface, allowing clients to start trading immediately without delving into endless documentation.

These solutions are also more cost-effective than ad exchanges as they are based on a simple and transparent system where platform users pay a sheer percentage of their profit/spending.?

Now, as you have seen both options — the rocky land of ad exchanges and bright horizons of programmatic middleware alternatives, the choice is up to you. However, if you want to take your programmatic advertising initiatives to a whole new level, it’s better to keep up with the latest trends and advancements. In the fiercely competitive ad landscape, only those who embrace changes win the race.?