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Programmatic Overview and Best Practices
This document provides an overview of best practices for programmatic advertising. It discusses common challenges media companies face with direct sales such as fragmented operations, technology, and yield optimization. It then outlines Operative's solution to integrate all aspects of digital advertising into a single operating system. The document also reviews the current programmatic landscape, including real-time bidding strategies and challenges around header bidding. It provides examples of optimal programmatic infrastructure, inventory segmentation, staffing, and header bidding setup. The goal is to help media companies maximize revenue across direct, programmatic direct, and real-time bidding sales channels.
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Programmatic Overview and Best Practices
- 1. Best Practices For Programmatic September22, 2015 NYC Workshop
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- 3. © 2015 OperativeMedia, Inc. TECHNOLOGY WORKFLOW BUSINESS OUTCOMES Success manifests at the Intersection
- 4. IMPRESSIONS $$$ CUSTOM ENTERPRISEDEALS DIRECT:NAT/LOCAL AUDIENCE BULK An even moresignificant problem occurs in terms of Yield (profit/revenue) maximization. Operating independently, it becomes impossible to optimize pricing, resources and technology—and often results in the inability to even have accurate visibility into revenues, profits, sales and expenses. The Direct Sales Dilemma – Fragmented Yield
- 5. © 2015 OperativeMedia, Inc. The Direct Sales Dilemma – Fragmented Ops + Tech For media companies of any scale, there are significant challenges in executing—much less optimizing—direct sales. There are multiple sales teams representing multiple properties and trying to execute advertising deals across multiple technologies.
- 6. © 2015 OperativeMedia, Inc. The Direct Sales Dilemma – Fragmented Ops + Tech These multitudes of stakeholders tends to be partially solved by picking ONE pivot point (e.g., the media property) and then creating parallel but differentiated teams and processes to connect the organization. This is obviously inefficient for cost, speed, error rates and technology utilization.
- 7. © 2015 OperativeMedia, Inc. The Direct Sales Solution – Comprehensive Integration Operative.One was constructed as the operating system to interconnect all aspects of the digital advertising business—to connect all people, technologies and processes into a single data architecture. Operative Customers are able to create economic waterfalls without regard to the “artificial” barriers created by teams, properties or technologies.
- 8. © 2015 OperativeMedia, Inc. The Direct Sales Solution – Comprehensive Operations With regard to Operations, Operative consolidates business and delivery data and makes this usable across all phases of the campaign lifecycle. Through the configurable platform, media companies can still utilize unique skills and organizational structures to effect these processes.
- 9. SALES AD OPSFINANCE CRM: INVENTORY: AD BUSINESS MANAGEMENT: DMP/AUDIENCE BILLING: RECONCILIATION: Create Order Invoice Client Optimize Campaign Traffic CampaignSend to Ad Ops DISPLAY: VIDEO/VOD: PROGRAMMATIC : The Direct Sales Solution – Comprehensive Technology
- 10. The “All Sales”Dilemma – Fragmented Yield IMPRESSIONS $$$ CUSTOM DIRECTSALES PARTNER PROG. DIRECT SSPs An even more significant problem occurs in terms of Yield (profit/revenue) maximization. Operating independently, it becomes impossible to optimize pricing, resources and technology—and often results in the inability to even have accurate visibility into revenues, profits, sales and expenses.
- 11. © 2015 OperativeMedia, Inc. The “All Sales” Dilemma The same challenge that Operative conquered in the direct sales world now exists with the rise of programmatic, aggregators, exchanges and the increasingly complex number of demand sources and transaction platforms.
- 12. © 2015 OperativeMedia, Inc. The “All Sales” Solution Operative.One is currently expanding to become the operating system to interconnect all aspects of the digital advertising business—to connect all people, technologies and processes into a single data architecture. Our clients need to be able to create economic waterfalls without regard to the “artificial” barriers created by teams, properties or technologies.
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- 14. © 2015 OperativeMedia, Inc. RTB Still Most Popular for Marketers How do you expect your total programmatic budget to be allocated across the following buy types IN THE NEXT TWELVE MONTHS? Open Exchange (i.e. open auction-based spot buying) Private Marketplace (i.e. auction-based or flat CPM spot buying with a restricted number of buyers) Programmatic Guaranteed (i.e. futures-based buying)
- 15. © 2015 OperativeMedia, Inc. The Current Programmatic Landscape Backfill Open Exchange Header Bidding Private Marketplace Preferred Automated Guaranteed Premium Exchange
- 16. © 2015 OperativeMedia, Inc. Automated Guaranteed: Streamlining Direct Sales MATURITY: Publishers provide integrated scheduling, pricing, data sharing and reporting to facilitate the direct selling process across most inventory through a marketplace. REALITY: Publishers share pricing and some inventory information through partners like AdSlot, but data, viewability and other necessary add-ons are not yet integrated. Minor revenue stream.
- 17. © 2015 OperativeMedia, Inc. Backfill Open Exchange Header Bidding Premium Exchange
- 18. © 2015 OperativeMedia, Inc. Unreserved Programmatic MATURITY: Working like private auctions, publishers float premium inventory in a single system and allow a variety of select advertisers to bid against each other raising CPMs. REALITY: Inventory is floated case by case across several auction systems at the advertiser’s request. Minor revenue stream, no lift in CPM.
- 19. © 2015 OperativeMedia, Inc. Real-Time Bidding MATURITY: Publishers have 3-6 integrated partners who bid actively against each other with common floors and real time optimization occurs by placement. REALITY: Header bidding is activated and a wide variety of other partners are left in a “frozen” waterfall.
- 20. Best Practices for OptimizingProgrammatic
- 21. © 2015 OperativeMedia, Inc. What You’ll Learn • Common publisher RTB strategies in use today • How to build a proper infrastructure from the ground up • How to include segmentation in RTB strategy • How to scale your operations based on skillset • Where header bidding falls in programmatic strategy • What a mature RTB operation looks like
- 22. The Publisher YieldCurve IMPRESSIONS $$$ Custom Direct Sales Partner RTB Programm atic Direct © 2015 Operative Media, Inc.
- 23. © 2015 OperativeMedia, Inc. Maximizing RTB Revenue High-eCPMExchanges SolidFillRate Exchanges Backfill IMPRESSIONS $$$ HeaderBidding PMP
- 24. Scenario 1: “The RobotsScare Me”
- 25. © 2015 OperativeMedia, Inc. “Robots Scare Me” Have zero exchanges and rely on networks and AdSense Deterred by volume of tasks needed to optimize programmatic Rely on AdSense and house ads for backfill Be honest with yourself: Why don’t you use exchanges? Do something small, start with AdX (for DFP users) Call for help CURRENT STATE OPTIMAL STATE
- 26. © 2015 OperativeMedia, Inc. Developing an Infrastructure 1. Prepare for a testing period where you vet exchange partners for eCPM and fill 2. If you just look at CPM, you’re missing half of the equation 3. Partner Vetting: Forge good partners early on • Test reporting tools to make sure you can capture all necessary data for your business (i.e. site delivery, demand sources, bid landscape, floors, viewability, etc.) • Make sure that there is a solid support infrastructure at the exchanges, a technical resource available to answer questions (setup, reporting, best practices)
- 27. © 2015 OperativeMedia, Inc.
- 28. Scenario 2: “Set itand Forget It”
- 29. © 2015 OperativeMedia, Inc. “Set it and Forget It” “Sort of” have a yield person Varied number of exchanges and networks Occasional optimization based on “performance” Little to no daily maintenance Occasional reporting Few, if any, taxonomy changes “Sort of” Have a yield person Consolidate partners Optimize daily with concrete performance metrics Daily maintenance and reporting from BOTH partners and ad server Redesigned taxonomy to be optimal for programmatic CURRENT STATE OPTIMAL STATE
- 30. © 2015 OperativeMedia, Inc. 1. Work with 3-4 solid partners (plus AdX) to inject competition 2. Segment your remnant inventory into private marketplaces, high- performing exchanges, open exchanges, and backfill channels 3. How to segment your inventory: • Make it descriptive of what you are offering • Limit supply across verticals to lift eCPMs • Split your inventory and package to maximize eCPM • Be consistent between the ad server and exchanges Segmentation
- 31. © 2015 OperativeMedia, Inc. Less Effective Taxonomy: All Exchange inventory RoS/RoN No partner differentiation by platform No differentiation between PMP/RTB No packaging of inventory on open market No 1:1 ratio between ad server lines and exchange inventory Taxonomy Examples More Effective Taxonomy: RTB inventory segmented by platform/site/section/size Ability to package inventory (i.e. mobile/display, international/domestic, etc.) Ad server lines for both PMP/RTB inventory (at different priorities) Make sure there is a line for each ad product per exchange Ability to allocate impressions by either SoV or daily goals
- 32. Scenario 3: “Yeah, ifyou could do this too, that would be great.”
- 33. © 2015 OperativeMedia, Inc. “Yeah, if you could do this too, that would be great.” Ad Ops runs programmatic (on top of regular ad ops work) Same team optimizing direct and indirect campaigns PMPs and programmatic direct compete for time with direct optimization RTB is ignored or underutilized “Sort of” Have a dedicated yield person Ideally, have two. One for programmatic direct and one for RTB. Consider a separate yield analyst Make sure to have a decision engine CURRENT STATE OPTIMAL STATE
- 34. © 2015 OperativeMedia, Inc. Staffing and Skillset 1. Delivery analysis 2. Working knowledge of ad servers and the ad selection process (for troubleshooting or evaluating new partners and best practices) 3. Experience working in 3rd party ad tech systems to build inventory, generate code and tags, pull reports, and integrate with other systems BASIC SKILLS ADVANCED SKILLS 1. Data analysis 2. Partner evaluation 3. Ability to automate via APIs 4. Consultative industry knowledge to move from RTB to private marketplaces 5. Working knowledge of the buy side and bid optimization/KPIs You need a programmatic stakeholder(s), internal or external, that can do the following:
- 35. Scenario 4: “Headed fora Heartbreak”
- 36. © 2015 OperativeMedia, Inc. “Headed for a Heartbreak” Implemented header bidders UX suffers Inventory taken by headers has high ROI Remaining inventory…? (which can be 80-90%) Open exchange waterfall for incremental revenue Dedicated yield manager to avoid pitfalls of previous scenarios CURRENT STATE OPTIMAL STATE
- 37. © 2015 OperativeMedia, Inc. Header Bidding: What to Look Out For 1. No control or insight (black box, be aware of bid ranges) 2. Doesn’t work across all inventory 3. Has very low fill rates (about 10-15%) 4. Page load latency 5. Doesn’t allow for optimization or new partners
- 38. © 2015 OperativeMedia, Inc. Our Model (Sample Client Setup) PRIORITY INVENTORY 1 Takeovers, Exclusives, Custom Units 2 3 4 5 PMP Deals Through Rubicon with Ultra (Mindshare agency trading desk) 6 7 8 Direct Deals 9 Lower Value Direct Deals, ad networks (Undertone, Kargo) 10 11 OpenX Header Bidderm, Amazon Bidder (A9) 12 Operative Compete Network line type (OpenX, AOL, Rubicon, PubMatic being optimized by performance) competing AdX Dynamic Allocation 13 14 15 16 Ad.com / House / PSA
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Editor's Notes
- #10 Add more logos
- #24 Allow high-performing exchanges to serve and compete with AdX Emphasize revenue driving exchanges with high true eCPM Backfill for all exchanges and waterfall
- #25 A lot of you have tried different things, turning on AdX, header bidding, hiring yield managers – regardless, you know it’s been less than perfect.
- #26 Do you not use programmatic because it is fundamentally in opposition to your sales strategy? Or do you not use it because it’s hard? And that goes for the first scenario too.
- #27 Forge partnerships early on. If you don’t have the support you need internally OR from your partner, you’re screwed.
- #28 Do you not use programmatic because it is fundamentally in opposition to your sales strategy? Or do you not use it because it’s hard? And that goes for the first scenario too.
- #29 A lot of you have tried different things, turning on AdX, header bidding, hiring yield managers – regardless, you know it’s been less than perfect.
- #31 Do you not use programmatic because it is fundamentally in opposition to your sales strategy? Or do you not use it because it’s hard? And that goes for the first scenario too.
- #32 Do you not use programmatic because it is fundamentally in opposition to your sales strategy? Or do you not use it because it’s hard? And that goes for the first scenario too.
- #33 A lot of you have tried different things, turning on AdX, header bidding, hiring yield managers – regardless, you know it’s been less than perfect.
- #34 Asking ad ops to do two jobs is like asking sales to traffic their own orders. One of two things is going to happen: They are going to stop selling, or they are going to screw up the trafficking. It’s the same here – something is not going to get optimized. Something is going to get ignored or screwed up, and that’s not good for anyone. This is what we do. We do it for you.
- #35 Asking ad ops to do two jobs is like asking sales to traffic their own orders. One of two things is going to happen: They are going to stop selling, or they are going to screw up the trafficking. It’s the same here – something is not going to get optimized. Something is going to get ignored or screwed up, and that’s not good for anyone. This is what we do. We do it for you.
- #36 A lot of you have tried different things, turning on AdX, header bidding, hiring yield managers – regardless, you know it’s been less than perfect.