The world of online advertising is now omnipresent. When we visit websites, use mobile apps, or even turn on our smart TVs, ads follow us. These ads are not just simple pop-ups but personalized advertisements that accurately reflect our interests and preferences. How is this personalization possible? The secret lies in ‘Ad-Tech.’
The Scale and Growth Trends of the Online Advertising Market
The online advertising market has been experiencing tremendous growth every year. In 2023, the global digital advertising market size reached approximately $666.8 billion, with 76.3% of total ad revenue expected to come from digital. In South Korea, the digital advertising market is also growing steadily, with a scale of 9.2831 trillion won. Ad-tech technology underpins this growth.
What is Ad-Tech?
Ad-tech refers to all IT technologies used to automate and improve the buying, selling, delivery, and optimization of online advertising. This includes technologies like Real-Time Bidding (RTB), ad networks, and ad exchanges. These technologies help advertisers reach more precise targets, increase ad response rates, and optimize marketing costs.
Key Systems and Processes of Ad-Tech
The core systems of ad-tech include DSP (Demand Side Platform), DMP (Data Management Platform), SSP (Supply Side Platform), and ad exchanges.
- DSP (Demand Side Platform): A system that allows advertisers to automatically purchase ad space. It bids at appropriate prices across various ad spaces to secure optimal ad placements.
- DMP (Data Management Platform): It collects, stores, and manages data needed to define and analyze target user groups. This helps advertisers reach more precise targets.
- SSP (Supply Side Platform): A system that helps ad space owners sell their ad spaces. It suggests suitable conditions to advertisers to get the highest bid price.
- Ad Exchange: A central marketplace where the buying and selling of ad space occurs through real-time auctions between DSPs and SSPs. Ads are quickly determined and delivered to consumers.
Trends in Ad-Tech
Recently, the ad-tech industry has been advancing further with the development of big data and data analysis technologies. Especially, ad-tech utilizing artificial intelligence can develop very precise and efficient advertising strategies. AI analyzes users’ interests and purchasing patterns to create highly targeted ads. However, with the advancement of these technologies, the need for privacy protection is also increasing. Many countries are introducing legal regulations to strengthen data protection and user privacy.
Why Ad-Tech is Important
The reasons why ad-tech technology is important include efficient targeting, optimized advertising costs, performance measurement and analysis, personalized user experiences, and data privacy. Ad-tech automates the planning, execution, and management of ad campaigns, saving time and costs while increasing efficiency. It also provides personalized experiences through various channels, enhancing user engagement and brand loyalty.
In Conclusion
Ad-tech plays a crucial role in digital marketing, driving innovation and growth in the advertising industry. Remember, if you frequently see ads related to you on portals, social media, online shopping malls, or blogs, it’s thanks to ad-tech technology.
References: 2023 & 2024 Digital Advertising Market Trends Report, Korea Broadcasting Advertising Corporation