As with programmatic display, the earliest inroads into programmatic video were set up to give the buyer the right of way in certain key matters. Private exchanges initially left valuable inventory ripe for cherry-picking by buyers, and prone to devalue greatly if passed back. Meanwhile, video content that by rights should have passed the “premium” test remained undiscovered by buyers wary of the unknown mid-to-long tail.
To get the best value programmatically for their video inventory while encouraging buyers to spend heartily through programmatic video channels, publishers need to take control over their goods. Making more video inventory available programmatically is fine, but without exercising strategy around it, you’re going to leave money on the table.
The complicated part is that “control” means something slightly different for a number of different kinds of publishers – and a number of different kinds of seller/buyer relationships. Do your buyers insist on bringing their own data, or can you layer in first-, second- or third-party data from your own sources?
A Private Affair
No matter what happens, advertisers will be buying in the programmatic marketplace – those programmatic budgets are earmarked. One of the ground-level challenges for publishers is to make sure they can drive the most yield possible for that demand, and that means bringing buyers into private exchanges. Programmatic video control starts here.
Advertisers are certainly willing to pay more for preferential treatment and access to their preferred audiences in a premium environment. And with perceived “premium” video content being relatively scarce, advertisers are willing to enter that private room to cut back on whatever risk they might view in the open exchanges.
Set up in advance with one specific buyer at a time, private exchange deals offer the seller controls they wouldn’t have in the open exchanges. Most obviously, they offer a scenario where a publisher can control which advertisers end up on the page —the pub can give an up or down vote to any comers.
This provides a layer of transparency, for both sides: the publisher knows exactly who’s buying what, and at what price. The knowledge that the inventory is coming from a trusted source is an incentive the seller can offer the buyer. And the seller gets the added benefit of being able to trust the buyers they’re getting through private exchanges are right for their publication’s brand.
Once the deal is sealed, the pub has controls over the treatment they can offer preferred buyers. Want to adjust pricing, offer custom deals? Can do. Control frequency capping? Sure, that’s possible. Want more of a say over the ad creative that gets delivered to your site in a campaign? The closeness you have to the buyer makes that also a possibility, on a case-by-case basis and depending on the buyer’s willingness and ability to work with their preferred publishers.
Want to make the best use of your own first-party data for the buyer’s benefit, or work with advertisers to create second-party data segments? Also on the table. These assets are especially valuable in video, where the inventory is more scarce, and the engagement on the user’s side is deeper and more meaningful.
The transaction and execution may depend on programmatic pipes, but the nature of private exchanges allow for closer collaboration between buyer and seller, and thus potentially more control on the publisher’s end.
Let’s also note that DSPs and trading desks are increasingly reaching out directly to publishers to set up Deal IDs for private exchanges, whether those IDs pertain to specific advertisers or, more broadly, to certain industry verticals. With those Deal IDs in place, private exchanges can run with less interference from intermediaries. And with the third party stepping out of the way, the publisher retains more control for itself, rather than ceding it to an intermediary that it has to rely on throughout the life span of the deal.
However, a lot of this isn’t possible if your video SSP isn’t up to snuff. Your SSP should have connections or integrations with the majority of DSPs and trading desks so you aren’t limited in who you can cut deals with. In addition, this ensures transparency in pricing for all parties while preventing intermediaries from sneaking in some arbitrage action.
Also, your SSP should make it easy to set up and execute a slew of Deal IDs at a time, because you’ll probably want a good deal in pricing flexibility during each campaign. Beyond that, fast-updating analytics and reporting are essential in guiding campaign optimization, both in fill rate and pricing.
The theory behind programmatic video is that by simply relying on direct sales, publishers are leaving programmatic dollars on the table – if your SSP can’t help you see where, what’s the point in diving in? Of course, then you’ll need great flexibility with floors and pricing, as well as connections with your DMP and third-party data providers to enable advanced audience targeting.
Private exchanges are a key tool in flexing your programmatic video muscles, but you’ll never be able to truly beef up without the right SSP.
Striking the Right Balance With Programmatic Guaranteed
We’ve argued that in the near future all standard ad unit transactions – including video assets like pre-roll – will be automated in some fashion, whether through RTB-based exchanges/marketplaces or other programmatic outlets. Advertisers are eager to transact programmatically, but they’re also accustomed to buying video ad space upfront, as in traditional broadcast. Perhaps the best way of combining those two impulses is through programmatic guaranteed – audience guarantees executed through programmatic channels (typically RTB).
Here, publishers can guarantee on a certain level of spend or against advertisers’ demographics, and against their own first-party audience segments when they can provide them in a private exchange. The promise for publisher control here is that they can optimize on these campaigns in real time, including by setting price floors that reflect the real value of their inventory in these settings.
However, programmatic guaranteed is still an evolving niche. The promise is clear, and the automation is possible, but there are still logistical problems in delivering guaranteed audiences.
One publisher source we spoke with described a scenario in which the advertiser wants to buy media across a certain audience. The publisher works to match cookies from the advertiser’s DMP to the publisher’s data sets or ad server, and fluctuation in the marketplace (1 million impressions upon first booking, versus 250,000 at a later date) makes booking over time very difficult.
Forecasting has long been a pain for publishers, and it still hasn’t been resolved widely. However, for a publisher who can manage those disparate data sets – and through conversations we’ve had, pubs seem more empowered than ever to work this out through DMPs – it’s clear what they stand to gain, and how much clout that data gives them, in programmatic guaranteed.
For the publisher, programmatic guaranteed is also simply efficient where accounting is concerned. It allows the pub to handle and report on more payments within the programmatic system, rather than fragmenting the flow of funds through extra channels.
Keep Flexing, Keep Training, Stay Programmatically Buff
As the programmatic video space matures, publishers have more opportunities to step in and start directing traffic, in order to benefit their own businesses and to enrich relationships with advertisers. That’s not to say it’s easy across the board. For publishers, taking programmatic video to the next level requires close attention to many different aspects of the marketplace, and several different entities connecting the buyer to the seller, all at once.
It’s kind of like gym training — the publisher has a bunch of different sets of muscles to work, and while you might not need to work them all evenly, depending on your particular goals, you don’t want to let any of those muscles turn flabby. Train and flex accordingly in all areas, with the tools at your disposal: notabley private exchanges and programmatic guaranteed.
Increasingly, industry types are advising advertisers and publishers to communicate and help each other reach their marks, and that level of communication can be beneficial to pubs. The scale issue, among others, creates a situation where advertisers and publishers express their goals and work together to try to meet them.
Greater transparency on all sides leads to buyers placing more trust in sellers, which allows sellers to place the rightful value on their inventory and audiences, and buyers to understand what they get from those prices.