Identifying efficient supply paths to maximise the effectiveness of programmatic advertising

As programmatic advertising is growing exponentially, the purchasing experience is getting more complex. Whether you are a specialist in programmatic advertising or just starting out, the right approach to set yourself up for success involves supply path optimisation (SPO). To ease the complexity of programmatic advertising, it’s critical to implement SPO into your programmatic strategy.

In simple terms, SPO is about simplifying the supply chain between advertisers and publishers by cutting out unneeded intermediaries and reducing redundancies. For those well-versed with programmatic, SPO is about making smarter choices about which auctions to participate in and which ones to ignore.

As the grey clouds of transparency begin clearing for the ad tech industry with new measures in place alongside better laws, we will begin to see a more transparent and more efficient programmatic ecosystem. For advertisers, ensuring that you are getting quality inventory from your ad spend is essential and SPO delivers just that.

Since the gambit of SPO is vast, let’s take a look at some of the main motivations behind SPO adoption:

1. Increased media quality
2. Purchasing high-quality media at the best value
3. Increased ROI for ad spends
4. Reducing waste in ad spends
5. Cutting costs i.e. advertising budgets
6. Increased transparency into the supply path i.e. the ability to identify and diagnose supply path inefficiencies related to media quality
7. Linking financial data to impression quality

Boosting the efficiency of maximise impact of digital campaigns:

SPO helps to identify secure inventory as well as evaluate supply path performance. This helps advertisers to identify which supply paths are getting them the best results versus the ones that aren’t. Media buyers can intentionally focus their bids on the most efficient, most scalable and most transparent supply paths, which extends the impact of a buyer’s ad spend. Given the complexity of programmatic advertising, purchasing low-quality media can turn out to be more expensive than purchasing high-quality media. To maximise the impact of your digital campaign, it becomes critical to know how much ad spend is devoted to brand usage, unviewable, or invalid traffic. By understanding how their ad spends are flowing, advertising fees become transparent; therefore, making it easier to track down why an ad appeared somewhere.

Analyse data to set realistic programmatic goals

Since the main goal for any advertiser is to maximise the impact of a digital campaign, it is crucial for brands and agencies to create quality and financial benchmarks for their programmatic strategy. A recent study found that brands and agencies do not see eye to eye when it comes to who should take responsibility for monitoring media quality. When asked about this, 47% of brands and 38% of agencies agree that brands are responsible for day-to-day SPO activities; by contrast, 29% of brands and 38% of agencies believe that agencies are accountable for these tasks. This disconnect highlights the importance of greater alignment between media buyers to fully achieve the benefits of supply path optimization.

Monitoring global insights to ensure high performance per market

To implement an SPO strategy successfully, it is important to keep track of global and market-level media efficiency. Leveraging market insights to inform strategies allows marketers to change their global strategies and adapt to current trends. As brands try to strike a connection with the consumer, marketers need to leverage global relationships to drive local efficiency.

SPO is transforming how buyers and sellers interact with each other in the dynamic programmatic world. When it comes to adopting an SPO approach, one might want to cut ties with the worst sites and SSPs that have high fees and resold inventory, whereas the other approach would be to identify the best.

This is the third article from a three-part series of programmatic articles, aimed to educate marketers and advertisers about programmatic advertising, its benefits, factors to consider, and the latest technologies that make programmatic advertising the need of the hour. Read the first article here and the second article here.

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