What is Ad Mediation? How Does Ad Mediation Work?

Publift
June 1, 2022
November 4, 2022
What is Ad Mediation? How Does Ad Mediation Work?

Ad mediation provides publishers full flexibility and in-depth control over how, when, and who is able to purchase ad inventory. It makes it less cumbersome to manage multiple ad networks and more profitable in terms of revenue generation.

While ad mediation has been around for a little over a decade, more publishers and developers are exploring the potential ad mediation platforms offer, given that some can perform up to 20% better than a single ad network.

With more than 5 billion internet users, it's little wonder that publishers and developers have honed in on the digital advertising industry as a major source of revenue.

With global digital and media advertising spending consistently increasing year on year, according to Statista, it's no wonder that publishers and developers are looking to maximize their ad revenue opportunities.

Read on to find out more about what ad mediation is, how it works, and which platforms can help publishers and developers achieve their key performance indicators (KPIs).

Table of contents:

What Is Ad Mediation?

How Does Ad Mediation Work?

What Are the Uses of Ad Mediation and Mediation Platforms?

What Are the Benefits of Ad Mediation?

Conclusion

FAQs

What Is Ad Mediation?

Ad Mediation Defination

Ad mediation is a solution that allows publishers to use technology to offer their ad inventory to multiple advertisers through ad mediation and mediation platforms. The goal is to maximize ad monetization by increasing the effective cost per mille (eCPM), display ad fill rates, and general efficiency.

Mobile ad mediation is a management solution that uses technology to allow publishers and developers to operate multiple ad networks via a single software development kit (SDK).

Ad mediation platforms generally streamline and optimize searches for top-performing ad networks, eliminating the need for publishers to do so manually.

To understand how ad mediation platforms can help publishers increase their ad revenue, first let's look at the following formula:

How to calculate Ad Mediation

Ad revenue = Ad requests * fill rate * eCPM

With this formula in mind, ad mediation platforms seek to either optimize the fill rate, eCPM, or both to maximize ad revenue earned from each ad request.

How Does Ad Mediation Work?

Ad mediation, through ad mediation platforms, provides ad publishers access to multiple ad networks. Advertisers then bid against each other for the available ad inventory.

The ad mediation platforms ultimately select the advertiser that will generate the biggest return on investment (ROI). Simply put, the highest bidder wins.

Again, publishers rank multiple ad networks in the order they prefer them, look to the top ad network to fill an ad request. But if that ad network cannot, the ad mediation platform moves to the next one to fill the request.

The publisher continues sending ad requests to their list of specific ad networks until the request is filled.

What Are the Uses of Ad Mediation and Mediation Platforms?

The main goal of ad mediation and mediation platforms is to increase ad revenue for publishers. The platforms connect to multiple ad networks via a single integration, then perform ad mediation with the data generated from each network, filling up an ad inventory with the highest CPM possible.  

Ad mediation platforms maximize ROI by selling ad space through either waterfall bidding or in-app header bidding

Waterfall bidding, the older of the two options, involves prioritizing and ordering multiple ad networks based on their total ad revenue. For instance, when an app developer requests to fill an ad, the mediation platform selects the highest-performing ad network until the demand has been met, after which it moves on to the next ad network in line.

In the header bidding method, however, publishers have multiple advertisers engage in real-time bidding (RTB) for a specific ad space via more modern advertising technology. The highest bidder pays $0.01 higher than the second-highest bidder to win the ad space. In this way, the mediation platform selects high-paying advertisers, and publishers can sell their inventory at the highest rate they can offer.

Comparing ad mediation vs RTB mobile, the difference lies in their approach. Ad mediation involves using a platform to search for the highest quality ad networks possible when delivering ad inventory to multiple demand channels. With this, publishers have a better chance of filling their ad slots with the most suitable ads. The focus is on how to fill the space with the best ad.

On the other hand, RTB mobile centers on the audience. As the name suggests, it allows advertisers to put their bids on available slots, making it easier to track and evaluate each impression based on its own merits. Advertisers can access hundreds of ad exchanges and decide on how much to bid based on the value they attach to each audience. This makes it cost-efficient for advertisers since they strategically target valuable customers.

What Are the Benefits of Ad Mediation?

There are many advantages to using ad mediation and ad mediation platforms for your app and website. Here are a few of them:

1. Increases Display Ad Fill Rates

Ad mediation helps boost ad fill rates by increasing the amount of ad inventory sold. Publishers can allow multiple ad networks access to their ad inventory, enabling advertisers to bid for their ad space. This opens the door to greater competition between advertisers willing to pay more for space.

2. Provides a Cohesive Ad Management Structure

Ad mediation lets publishers multiple ad networks through one platform and also lets app developers manage the same via SDK integration. Removing the need to manage each ad network on an individual basis.

3. Increases CPM Rates

Ad mediation platforms help publishers boost CPM rates through the connection with multiple ad networks. When there's more than one advertiser competing for impressions, CPM rates go up.

Without ad mediation and multiple networks, there won't be any competition, and there'd be no option but to sell inventory to a single offer.

Conclusion

Looking to monetize a highly-performing app or website? Ad mediation helps publishers solve the problem of scaling and efficiently managing monetization strategies.

Through one centralized platform, publishers and developers can manage multiple networks, increasing ad revenue in the process.

Publift helps digital publishers get the most out of the ads on their websites. Publift has helped its clients realize an average 55% uplift in ad revenue since 2015, through the use of cutting-edge programmatic advertising technology paired with impartial and ethical guidance.

Contact us today to learn more about how Publift can help boost your ad revenue and grow your business!

FAQs

What is Mobile Ad Mediation?

Mobile ad mediation is a revenue generation tool that ensures an app developer’s revenue from in-app ads increases significantly by integrating a singular SDK. 

In-app ads serve as the chief revenue source for app developers or publishers. An ad mediation platform allows app developers to manage and optimize in-app ads from different ad networks to maximize ad monetization. The ad revenue generation tool gives multiple ad networks access to the ad inventory. It allows the ad networks to bid against each other and selects the highest bid to drive up a publisher’s revenue.

Which Ad Network Is Best for Mediation?

Google AdMob is the widely used and most popular ad mediation platform among publishers.

Listed below are some of the best ad networks for mediation.

  • Smaato
  • Unity
  • InMob
  • ironSource
  • TapJoy
  • AdColony
  • Facebook/Instagram

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