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How Dynamic Ad Insertion Works

Author: Samantha Robin
by Samantha Robin
Posted: Apr 20, 2019

From the days of print when advertisers purely hinged on chance and conjecture to come up with their campaign stats to the days of web when it became reasonably possible to guesstimate and target the appropriate user demographic, media advertising strategies have come a long way. The gold mine was hit when the focus shifted from the whole to the individual. Where earlier, companies hunted down a ‘broad demographic’ through print ads in relevant newspapers, digital media served as a radar which made it possible to make fairly accurate guesses about an ‘individual reader’. So, companies could now buy ads that targeted specific readers with specific traits.

The above blessed means of targeting audience is made accessible through a media advertising tool called the Dynamic Ad Insertion or DAI.

Still, what exactly is DAI?

Dynamic Ad Insertion (DAI) is a technology that enables advertisers to carry out an "ad-exchange" in linear, live or on-demand video content. To put it simply, instead of serving the same ad to each consumer, it is now feasible to target each user with ad swaps through a modern ad server. The benefit is self-evident: more subtle targeting will result in more ad relevancy on an impression-by-impression basis which will in turn amplify purchases by attracting more consumer engagement. Since media owners also benefit as many rely on ad-revenue to generate fresh content, Dynamic Ad Insertion enhances ad performance while leaving the user experience unscathed, which converts to higher CPMs and increased revenue for the media owner. Let’s see how it works.


Have you ever wondered how you receive ads that are tailored to your tastes? Well, the secret behind them is these cookies which record your browsing behaviors (on social media, search engines) to give you a more customized web experience.

Were they really named after the story of Hansel and Gretel, who left a trail of cookie crumbs behind them in a dark forest or maybe the prophetic fortune cookies of China? Whatever be the origin, web cookies work a lot similar to the stories they seem to have taken up their name from. Cookies are small bits of text stored on your computer by your web browser, used to extract and store data about you and your preferences. Cookies exist because the intrinsic HTTP protocol is stateless – each of your browser requests is separate from the other so the server needs a way to determine which request belongs to which user. By storing information in a cookie, the server can identify a page view as belonging to your account. They may store data such as your name, your address, your session token, items in your shopping cart, your preferred web page layout or a certain map you might be looking for.

Device Fingerprinting

Device Fingerprinting or Browser fingerprinting is a step ahead of the cookie game as it allows a server to identify not just the browser, but an individual device. Using a number of data points such as your PC’s IP address, HTTP request headers, Timestamp, browser version, device location, installed fonts and apps, an identifier is created that helps to recognize your device. In simple terms, this tech works a lot like our ability to differentiate between people. The reason why you can recognize John from Jack is the reason why the server can recognize your computer from somebody else’s on the web; hence the more the number of data points that are collected, the better the device identification.

User Identification

As the name suggests, this tech is able to identify an individual user across whichever device they may be using – even if they may have switched from one device to the other. This takes place in two ways –

  • Deterministic – This approach makes use of a login ID or other registration data to identify a user. For example – Consider Facebook; since all users are required to login, knowing which ads are shown on a user’s phone and which links are clicked via their PCs is feasible.
  • Probabilistic – These identifiers use a large number of signals across multiple channels to develop user profiles by matching anonymous data points with data from known users who show forth similar traits. Probabilistic data points could include browser version, time zone, device type, JavaScript commands, and even shared IP addresses – basically everyday elements of the web that don’t point to any specific user but that enable the digital community to function normally.
  • DAI creates a "win-win" situation: where advertisers are armed with better ways of targeting their audience, ad-generated revenues enable media owners to come up with more content and users enjoy a more personalized and unscathed browsing experience.

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    Author: Samantha Robin

    Samantha Robin

    United States

    Member since: Apr 17, 2019
    Published articles: 1

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