Conversion APIs Are Becoming Table Stakes - But Not All Brands Have Bought In | AdExchanger

"You know the old adage "garbage in, garbage out"? Well, it applies to the walled gardens, too, even with all of their access to first-party data. The big ad platforms have been investing more in end-to-end automated systems for planning, launching and optimizing ad campaigns, but they still need high-quality data inputs to feed those tools."

"A foundation for optimization Basically, a CAPI is a back-end server-to-server process by which an advertising platform logs user actions associated with ad exposures. If, for instance, a user visits a brand's landing page after clicking on an ad they saw on a platform, the CAPI logs that action along with details about the ad, like the creative version and the timestamp, plus information about what that user does on the page. This data is then tied to an anonymized identifier."

"Agencies now consider CAPI integrations as "foundational" measurement tools for their clients, according to Michael Nicolosi, senior analytics director for the Americas at Brandtech Group-owned agency Jellyfish. Direct insight into which ad placements are driving conversions "could change how budgets are allocated," Nicolosi added. However, the true benefit of CAPIs is having more accurate optimization signals to feed into bidding algorithms, he said."

Conversion APIs (CAPIs) provide server-to-server linkage that delivers high-quality conversion data from advertisers to walled-garden ad platforms. Platforms use those inputs to power end-to-end automated systems for planning, launching, and optimizing campaigns. CAPIs log user actions tied to ad exposures, including creative versions, timestamps, and post-click behavior, and associate events with anonymized identifiers. Accurate CAPI data improves optimization signals fed into bidding algorithms and offers direct insight into which placements drive conversions, enabling more efficient budget allocation. CAPI integrations have shifted from optional to foundational inside walled gardens, supporting a more outcomes-driven, less wasteful ad ecosystem.

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