programmatic overview and best practices

Best Practices For Programmatic

September 22, 2015 NYC Workshop

Operative Overview

Jason WittCRO

© 2015 Operative Media, Inc.

TECHNOLOGY

WORKFLOWBUSINESS OUTCOMES

Success manifests at the Intersection

IMPRESSIONS

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An even more significant problem occurs in terms of Yield (profit/revenue) maximization.

Operating independently, it becomes impossible to optimize pricing, resources and technology—and often results in the inability to even have accurate visibility into revenues, profits, sales and expenses.

The Direct Sales Dilemma – Fragmented Yield


The Direct Sales Dilemma – Fragmented Ops + TechFor media companies of any scale, there are significant challenges in executing—much less optimizing—direct sales.

There are multiple sales teams representing multiple properties and trying to execute advertising deals across multiple technologies.


The Direct Sales Dilemma – Fragmented Ops + TechThese multitudes of stakeholders tends to be partially solved by picking ONE pivot point (e.g., the media property) and then creating parallel but differentiated teams and processes to connect the organization.

This is obviously inefficient for cost, speed, error rates and technology utilization.


The Direct Sales Solution – Comprehensive IntegrationOperative.One was constructed as the operating system to interconnect all aspects of the digital advertising business—to connect all people, technologies and processes into a single data architecture.

Operative Customers are able to create economic waterfalls without regard to the “artificial” barriers created by teams, properties or technologies.


The Direct Sales Solution – Comprehensive OperationsWith regard to Operations, Operative consolidates business and delivery data and makes this usable across all phases of the campaign lifecycle.

Through the configurable platform, media companies can still utilize unique skills and organizational structures to effect these processes.

SALES AD OPS FINANCE

CRM:

INVENTORY:

AD BUSINESS MANAGEMENT:

DMP/AUDIENCE

BILLING:

RECONCILIATION:

Create Order Invoice ClientOptimize CampaignTraffic CampaignSend to Ad Ops

DISPLAY: VIDEO/VOD: PROGRAMMATIC :

The Direct Sales Solution – Comprehensive Technology

The “All Sales” Dilemma – Fragmented Yield

IMPRESSIONS

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An even more significant problem occurs in terms of Yield (profit/revenue) maximization.

Operating independently, it becomes impossible to optimize pricing, resources and technology—and often results in the inability to even have accurate visibility into revenues, profits, sales and expenses.


The “All Sales” DilemmaThe same challenge that Operative conquered in the direct sales world now exists with the rise of programmatic, aggregators, exchanges and the increasingly complex number of demand sources and transaction platforms.


The “All Sales” SolutionOperative.One is currently expanding to become the operating system to interconnect all aspects of the digital advertising business—to connect all people, technologies and processes into a single data architecture.

Our clients need to be able to create economic waterfalls without regard to the “artificial” barriers created by teams, properties or technologies.

The Current Programmatic LandscapeDon Amboyer

General Manager


RTB Still Most Popular for Marketers

How do you expect your total programmatic budget to be allocated across the following buy types IN THE NEXT TWELVE MONTHS?

Open Exchange (i.e. open auction-based spot buying)

Private Marketplace (i.e. auction-based or flat CPM spot buying with a restricted number of buyers)

Programmatic Guaranteed (i.e. futures-based buying)


The Current Programmatic Landscape

Backfill OpenExchange

HeaderBidding

PrivateMarketplace Preferred Automated

GuaranteedPremiumExchange


Automated Guaranteed: Streamlining Direct Sales

MATURITY: Publishers provide integrated scheduling, pricing, data sharing and reporting to facilitate the direct selling process across most inventory through a marketplace.

REALITY: Publishers share pricing and some inventory information through partners like AdSlot, but data, viewability and other necessary add-ons are not yet integrated. Minor revenue stream.


Backfill OpenExchange

HeaderBidding

PremiumExchange


Unreserved Programmatic

MATURITY: Working like private auctions, publishers float premium inventory in a single system and allow a variety of select advertisers to bid against each other raising CPMs.

REALITY: Inventory is floated case by case across several auction systems at the advertiser’s request. Minor revenue stream, no lift in CPM.


Real-Time Bidding

MATURITY: Publishers have 3-6 integrated partners who bid actively against each other with common floors and real time optimization occurs by placement.

REALITY: Header bidding is activated and a wide variety of other partners are left in a “frozen” waterfall.

Best Practices for Optimizing Programmatic


What You’ll Learn

• Common publisher RTB strategies in use today

• How to build a proper infrastructure from the ground up

• How to include segmentation in RTB strategy

• How to scale your operations based on skillset

• Where header bidding falls in programmatic strategy

• What a mature RTB operation looks like

The Publisher Yield Curve

IMPRESSIONS

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CustomDirect Sales

Partner

RTB

Programmatic Direct



Maximizing RTB Revenue

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PMP

Scenario 1: “The Robots Scare Me”


“Robots Scare Me”

Have zero exchanges and rely on networks and AdSense

Deterred by volume of tasks neededto optimize programmatic

Rely on AdSense and houseads for backfill

Be honest with yourself: Why don’t you use exchanges?

Do something small, start with AdX (for DFP users)

Call for help

CURRENT STATE OPTIMAL STATE


Developing an Infrastructure

1. Prepare for a testing period where you vet exchange partners for eCPM and fill

2. If you just look at CPM, you’re missing half of the equation

3. Partner Vetting: Forge good partners early on

• Test reporting tools to make sure you can capture all necessary data for your business (i.e. site delivery, demand sources, bid landscape, floors, viewability, etc.)

• Make sure that there is a solid support infrastructure at the exchanges, a technical resource available to answer questions (setup, reporting, best practices)

Scenario 2: “Set it and Forget It”


“Set it and Forget It”

“Sort of” have a yield person

Varied number of exchanges and networks

Occasional optimization based on “performance”

Little to no daily maintenance

Occasional reporting

Few, if any, taxonomy changes

“Sort of” Have a yield person

Consolidate partners

Optimize daily with concrete performance metrics

Daily maintenance and reportingfrom BOTH partners and ad server

Redesigned taxonomy to be optimal for programmatic



1. Work with 3-4 solid partners (plus AdX) to inject competition

2. Segment your remnant inventory into private marketplaces, high-performing exchanges, open exchanges, and backfill channels

3. How to segment your inventory:

• Make it descriptive of what you are offering

• Limit supply across verticals to lift eCPMs

• Split your inventory and package to maximize eCPM

• Be consistent between the ad server and exchanges

Segmentation


Less Effective Taxonomy:All Exchange inventory RoS/RoN

No partner differentiation by platform

No differentiation between PMP/RTB

No packaging of inventory on open market

No 1:1 ratio between ad server lines and exchange inventory

Taxonomy Examples

More Effective Taxonomy:RTB inventory segmented by

platform/site/section/size

Ability to package inventory (i.e. mobile/display, international/domestic, etc.)

Ad server lines for both PMP/RTB inventory (at different priorities)

Make sure there is a line for each ad product per exchange

Ability to allocate impressions by either SoV or daily goals

Scenario 3: “Yeah, if you could do this too, that would be great.”


“Yeah, if you could do this too, that would be great.”

Ad Ops runs programmatic (on top of regular ad ops work)

Same team optimizing direct and indirect campaigns

PMPs and programmatic direct competefor time with direct optimization

RTB is ignored or underutilized

“Sort of” Have a dedicated yield person

Ideally, have two. One for programmatic direct and one for RTB.

Consider a separate yield analyst

Make sure to have a decision engine



Staffing and Skillset

1. Delivery analysis

2. Working knowledge of ad servers and the ad selection process (for troubleshooting or evaluating new partners and best practices)

3. Experience working in 3rd party ad tech systems to build inventory, generate code and tags, pull reports, and integrate with other systems

BASIC SKILLS ADVANCED SKILLS

1. Data analysis

2. Partner evaluation

3. Ability to automate via APIs

4. Consultative industry knowledge to move from RTB to private marketplaces

5. Working knowledge of the buy side and bid optimization/KPIs

You need a programmatic stakeholder(s), internal or external, that can do the following:

Scenario 4: “Headed for a Heartbreak”


“Headed for a Heartbreak”

Implemented header bidders

UX suffers

Inventory taken by headers has high ROI

Remaining inventory…?(which can be 80-90%)

Open exchange waterfallfor incremental revenue

Dedicated yield manager to avoid pitfalls of previous scenarios



Header Bidding: What to Look Out For

1. No control or insight (black box, be aware of bid ranges)

2. Doesn’t work across all inventory

3. Has very low fill rates (about 10-15%)

4. Page load latency

5. Doesn’t allow for optimization or new partners


Our Model (Sample Client Setup)PRIORITY INVENTORY

1

Takeovers, Exclusives, Custom Units2

3

4

5PMP Deals Through Rubicon with Ultra

(Mindshare agency trading desk)6

7

8 Direct Deals9

Lower Value Direct Deals, ad networks (Undertone, Kargo)10

11 OpenX Header Bidderm, Amazon Bidder (A9)12 Operative Compete

Network line type (OpenX, AOL, Rubicon, PubMatic being optimized by performance) competing

AdX Dynamic Allocation

13

14

15

16 Ad.com / House / PSA

Learn more at:www.operative.com/compete