5 characteristics to assess when testing a DSP

Programmatic technology has quickly gone from buzzword to widely adopted media buying practice. Demand-side platforms (DSPs) lie in the center of this very crowded landscape, providing ad buyers access to exchange inventory in real-time. As media-buying technology becomes more and more commoditized, most DSPs now offer self-service products, allowing agencies, trading desks, and in-house media buyers to maneuver and control the optimization of a campaign.

Trading desks have the flexibility to work with one or many DSPs, but the breadth of options in our space has made choosing the right partners difficult. It is easy to succumb to flashy marketing that touts the "smartest" or "machine-learning" algorithm available in the marketplace. As a technology-agnostic trading desk, Varick Media Management has tested and vetted several partners, compiling the following attributes to look for to ensure flexible, accountable, and successful programmatic campaign executions.

Unique reach

Reach is often confused with scale, and exchanges have adequately supplied most DSPs with enough scale. So it's important to weigh the unique reach of each DSP to ensure the advertiser exposes ads to the highest number of potential customers. It is important to assess whether inventory is getting throttled through one DSP versus another. There are multiple factors that determine how much inventory one DSP sees, including relationships with exchanges and publishers. No one technology can see all available inventory, which is why a multi-platform solution allows for extended unique reach.

Ease of use

All DSPs boast intuitive, simple interfaces. A platform's user interface will often appear clean and easy to use, but have counterintuitive or absent technology. The challenge is finding a platform that is able to accommodate quick, en masse changes such as swapping creative, updating pacing, or changing bid floors -- capabilities that allow the advertiser to adjust a campaign in real-time as the results come in.

Bidder complexity

Technologically speaking, building a bidder is relatively simple. DSPs can buy or rent technology to funnel business through their platforms. The distinguishing factor among DSPs lies in their proprietary bidding rules and algorithms, which in turn affect how clients execute campaigns. When vetting a DSP's algorithm, weigh the bidder's consistency, as well as its learning agility and velocity. Not every algorithm works well across the board. It is important to know where the strengths and weaknesses lie depending on the goals of the campaign. Some DSPs excel at direct response campaigns, weeding out unnecessary impressions to quickly optimize toward conversions. Others perform well for upper funnel campaign goals, due to better access to premium inventory. No DSP is perfect, so a multi-platform approach to buying media is recommended.

Transparency

Digital marketing is fraught with a lack of accountability and transparency. Unlike stock and commodities markets, which have a considerable amount of oversight and regulation, our industry tends to obfuscate how results are being delivered. Bots, domain hacking, click farms, fraudulent clicks and traffic, price rigging, and viewability can all affect the clicks and impressions vendors report back to their clients.

Nefarious internet activity necessitates transparency into the way in which sellers operate. DSPs' algorithms may run the risk of lower performance if committed to preventing fraud and supplying transparency, which is why a human needs to monitor and pull the levers of campaign execution. Be suspicious of DSPs that hide behind "special sauce" algorithms or employ a "set it and forget it" method. Buyers should demand accountability in addition to results, so work with buying platforms that encourage a mix of data-driven decision logic and transparency into transactions.

Pricing

While results are important, buyers need to deliver success efficiently and economically. The final characteristic to assess when testing a DSP is to determine the value of the technology. When it comes to DSPs, cost does not always equal quality. When negotiating, ensuring that a DSP can deliver all of the attributes mentioned above is what's essential.

Trading desks, agencies, and advertisers need to ask the hard questions of buying platforms, whether they choose to employ self or managed service options. Be wary of vendors promising unparalleled campaign results with little insight into how they achieve success. The integrity of a brand should not be lost to suspicious technology, even if campaign results are too good to refuse.

Jona Mici is director of trading operations at Varick Media Management.

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