Mike Miller, SVP of Capabilities Excellence - Programmatic at KINESSO, highlights the advice given to marketers in ANA’s “Programmatic Media Supply Chain Transparency Study”, and looks at how marketers can take a more active role in their programmatic investments.

In December, the ANA released the full version of its “Programmatic Media Supply Chain Transparency Study”, which offers advice for marketers concerning areas the ANA has labeled waste that may occur through the $88bn open web programmatic supply chain. The report estimated that $22bn, or a quarter of that figure, “is wasteful or unproductive” and that just more than a third of ad investment in programmatic reaches the audience for which it was intended.

The study faced significant challenges, with several major players declining to participate and about two-thirds of clients who were originally interested in participating being unable to take part due to tech, legal, or other hurdles. Despite these setbacks and the relatively small sample size involved in the analysis as a result, some of the recommendations put forth in the study are sensible – specifically, those that focus on media stewardship and supply strategy.

The recommendations throughout the 125-page study, which includes a 16-point playbook for advertisers, can be summarized into an overarching statement:

Brands should ensure they are transacting media in a safe, transparent manner that balances efficiency with value, and have access to reporting that drives accountability. 

A look at media stewardship and supply strategy

Whether your programmatic expertise lives in-house or with an agency partner, marketers should take a more active role in their programmatic investments by understanding the core components of the ecosystem and ensuring that the buying mechanics align with their brand objectives. The ANA playbook calls attention to domains and apps that may be included in a typical SSP’s default inventory which could be considered “made for advertising” (MFA), or, in other words, are designed to maximize ad space and publisher revenue despite potentially offering dubious content and delivering a poor user experience.

Further, DSPs are typically plugged into dozens of exchanges, each with different fee structures and business practices, yet with nearly identical inventory. From the supply side, publishers are incentivized to work with as many exchanges as possible to maximize selling available inventory. This results in a paradoxical cycle of duplicative auctions and DSP bid throttling that can increase spend for the advertiser, causes a poor user experience through long loading times, and creates a heavy carbon footprint that is bad for the environment. 

One solution to help tackle these issues is to curate, vet, and optimize the programmatic supply chain. This starts with developing domain and app inclusion lists specific to your brands and scrubbed for known MFA and high-carbon violators. While there is no magic number of domains to strive for, tools such as Pixalate and Jounce Media can help curate based on media quality, vertical, and so forth.

Reducing the number of SSPs is also key. The report found that, on average, the marketer participants used 19 SSPs, with the range being from nine to 53. Vetting these companies can be a big lift due to the complexity and nuance of their offerings, but doing so ensures access to trusted publishers while minimizing supply-side fees. As stated in the ANA report, only a handful of SSPs are typically necessary on a given campaign, although the list can vary by channel. 

Where marketers might be wary

Marketers should use caution, however, regarding two specific recommendations outlined in the ANA Playbook related to establishing a more direct buying pathway:

  1. Brands should look before they leap concerning the suggestion they only buy direct supply paths, which can be done by blocking any impressions flagged as coming from a reseller in the DSP. While this may seem like a good idea in theory, many quality publishers only offer their inventory via vendors which can be classified as “resellers” in their ads.txt files. As an alternative, brands can build a strong SSP and seller optimization strategy, which will reduce resold inventory while preserving the ability to access these publishers. 
  1. The playbook advises marketers to establish direct contracts with each DSP/SSP/Ad Verification partner. Many factors must be considered when evaluating contract ownership and there is often a benefit in the level of expertise and efficiency created via leveraging agency agreements.

Despite new developments that the report covers in the areas of MFA and sustainability, the topic of Supply Path Optimization (SPO) has been around the industry for several years now and should be familiar to any savvy media buyer. We can expect this subject to continue to evolve, which speaks to the need to constantly reevaluate your approach and ensure you are incorporating the latest solutions to address current market dynamics. 

We look forward to having deeper conversations regarding this study with our clients, to ensure they are prepared to meet the outlined standards.