South China Morning Post’s Ian Hocking touts a non-Open Marketplace advertising solution that optimises efficiencies and increases return on investment by connecting first-party data and persistent user IDs to programmatic deals.
In a bid to help drive efficiencies and return on investment (ROI) for buyers, the South China Morning Post (SCMP) removed its entire inventory from the Open Marketplace (OMP) in Hong Kong, Singapore, Malaysia, Vietnam and the Philippines on Jan 1, 2021, connecting their first-party data and persistent user IDs to programmatic deals (preferred deals and programmatic guaranteed).
There is a growing trend for global publishers to shift away from OMP and SCMP is the first in Asia to withdraw and offer a non-OMP solution that benefits advertisers, agencies and brands. But why?
Advantages and disadvantages of OMP
The rise of OMP spending has shaped the way most display media is bought and sold around the world. Starting off as a marketplace for unsold inventory with little data or quality control, it has developed into the primary activation channel for most digital brands.
OMP’s efficiencies are:
- Centralised activation – such as frequency capping, a single campaign to monitor, fewer points of contact, etc.;
- Controlled spending – with no need to keep spending in underperforming environments; and
- Inflight self-service data and optimisation on the buy-side.
All of these have helped to improve buying efficiency and led to better ROI. However, the OMP is not without its problems for both agencies and clients.
- Media value loss
This is an example of the main issue the buyers are facing. A complex ecosystem of intermediaries each take a certain percentage of the original cost per 1,000 impressions (CPM). The ISBA, an organisation representing leading UK advertisers, recently released a Programmatic Supply Chain Transparency Study, which indicated that, on average, 49% of the original media value is lost.
This means the OMP buyer may be less competitive than direct buyers and may not be able to access some inventory.
- Priority and reach issues
Sponsorship level deals get access to the first impressions to a user. This is important if you want to reach specific users that may be hard to find. Having more inventory to pick from also allows you to achieve a more even delivery and affords you the opportunity to optimise your campaign more. It also allows you to access options such as hard to buy formats and context.
What this means for advertisers and brands is that the OMP is at the bottom of the ad stack and buyers must make do with what is left.
- Ad fraud
This may be caused by things such as bots (fake clicks), domain spoofing (e.g. SCMP.co.uk) or click farms.
The world of digital advertising is hard to police and monitor. Although some companies such as White Ops and initiatives including the IAB’s ads.txt have had some success tackling or even taking down major bad actors, the technology that is used to defraud buyers and sellers grows in complexity all the time.
- Ad targeting data issues
On-target data from companies such as Neilsen and ComScore have shown data used to activate campaigns may be less than 50% accurate.
A ComScore VCE Benchmark from 2014 showed that the average accuracy for finance targeting was only 44%.
- Brand safety issues
While the commonly used tools of IAS and Grapeshot have been good in making the OMP a safe advertising environment, they are in no way perfect. They require a URL to get significant traction before they will read and categorise the content (if they can read it at all) as all apps require a publisher-side software development kit for the technology to work.
In addition, the keyword lists need to be so broad that they often cut out quality sites or block access to key users as a longtail of 2,000 or more sites cannot be checked for editorial standards. This leaves brands vulnerable in the OMP.
With the growing concerns the OMP represents for advertisers and publishers, it is getting more challenging to create efficiencies that drive success.
We believe that programmatic deals offer brands and buyers a better way to transact programmatic media. Which is why SCMP removed its inventory from the OMP to optimise efficiencies and increase the return on investment for advertisers by connecting SCMP’s first-party data and persistent user IDs to programmatic deals (preferred deals and programmatic guaranteed).
Marketers can potentially gain from non-OMP advertising solutions, including but not limited to the following.
- Increased buying transparency (essential for supply path optimisation)
With fewer intermediaries, we have more control and transparency. This allows us to pass important buying information back to the buyer and optimise the campaign to the chosen key performance indicator (KPI) more effectively.
This information may be used by the buyer to engage in supply path optimisation (SPO), the practice of optimising your supply path in order to ensure the maximum ad budget is allocated to media.
The agency will also be able to maintain the overall centralised buying efficiencies afforded to them by programmatic buying. These include more control on spend, client data application, SPO cost reduction and ease of setup.
- First-party data with minimum 80% confidence in ‘on target’ attribution
SCMP Lighthouse audience segments have been built with first-party, declared and observed data that allow us to know the precise quality of every attribute and make segments available with known ad quality. In addition, the fewer intermediaries you have, the less chance there is for ad fraud to occur.
- Brand safety issues are no longer a problem
SCMP SIGNAL is a brand safety tool. Built directly into our content management system, it ensures every article is tagged and measured before it is set live. This means a brand is able to fully take advantage of our audience and insight-led targeting, and open up the full capabilities of SCMP’s KPI optimisation.
- Persistent, first-party user level with over 2,000 targetable attributes
This may be the biggest single difference in the future as we know the third-party cookie will be deprecated and the IDFA (identifier for advertisers) will be restricted to advertisers. With it will come the end of several key drivers for the OMP:
- No more one-to-one audience matching;
- No more cross-domain tracking;
- No more user frequency capping; and
- No more user retargeting.
Basically, the marketer’s ability to create a relationship with a user and then build on it to drive that user down a funnel will be cut off in the OMP.
SCMP will be able to create a persistent (ongoing) relationship with individual users as we have migrated to first-party cookies and user logins (that do not degrade over time).
All these attributes will help SCMP to meet our clients’ branding needs and drive ROI.