The Open Marketplace may be costing you more than you think
January 19, 2021
SCMP Insights
The rise of Open Marketplace 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.
Efficiencies have been found in:
However the OMP is not without its problems for both agencies and clients
Media value loss
Diagram 1: An example of the type of Ad-spend erosion across the programmatic activation pathway.
Here we see one of the main issues facing buyers. A complex ecosystem of intermediaries that each take a percentage of the original cost per 1,000 impressions (CPM). The ISBA, a UK advertising body, recently released a Programmatic Supply Chain Transparency Study, which showed that on average 49 per cent 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
Diagram 2: The relative position in the Ad stack and Ad serving priority for each buy type, with the typical reach achieved at the OMP priority.
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 things such as hard to buy formats and context.
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 WhiteOps and initiatives including the IABs Ads.txt have had some success tackling or even taking down major bad actors, the technology that is used to defraud buyers and sellers gets more complex all the time.
Ad targeting data Issues
On-target data from companies such as Nielsen and ComScore have shown data used to activate campaigns may be less than 50 per cent accurate. A ComScore vCE Benchmark from 2014 showed that the average accuracy for finance targeting was only 44 per cent.
Brand safety issues
While the commonly used tools of IAS and Grapeshot are good for making the OMP as safe, 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 SDK (software development kit) for the technology to work.
The keyword lists need to be so broad that they often cut out quality sites or block access to key users as you can not check a longtail of 2,000 or more sites for editorial standards. This leaves brands vulnerable in the OMP.
OMP issues:
So what changes when you buy in a deal with SCMP?
Increased buying transparency (essential for SPO)
With fewer intermediaries, we are able to have more control and transparency. This allows us to pass important buying information back to the buyer and optimise the campaign to the chosen KPI (key performance indicator) 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 set-up.
Deal management & support from SCMP Ad Ops
This is a lost art these days as much of the service layer has been eroded. We have a large team of experienced operations staff that will troubleshoot issues, provide buyers with real-time deal dashboards (with self-service access). Lead regular campaign reviews and deliver best in market, post campaign analysis with beyond the click user level insights.
First-party data with a minimum of 80 per cent 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 and, in addition, it may be obvious to say, but 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 the market-leading brand safety tool. Built directly into our CMS (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 more than 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.
Deal benefits:
Efficiencies have been found in:
- 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.
- In-flight self-service data and optimisation on the buy-side.
However the OMP is not without its problems for both agencies and clients
Media value loss
Diagram 1: An example of the type of Ad-spend erosion across the programmatic activation pathway.
Here we see one of the main issues facing buyers. A complex ecosystem of intermediaries that each take a percentage of the original cost per 1,000 impressions (CPM). The ISBA, a UK advertising body, recently released a Programmatic Supply Chain Transparency Study, which showed that on average 49 per cent 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
Diagram 2: The relative position in the Ad stack and Ad serving priority for each buy type, with the typical reach achieved at the OMP priority.
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 things such as hard to buy formats and context.
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 WhiteOps and initiatives including the IABs Ads.txt have had some success tackling or even taking down major bad actors, the technology that is used to defraud buyers and sellers gets more complex all the time.
Ad targeting data Issues
On-target data from companies such as Nielsen and ComScore have shown data used to activate campaigns may be less than 50 per cent accurate. A ComScore vCE Benchmark from 2014 showed that the average accuracy for finance targeting was only 44 per cent.
Brand safety issues
While the commonly used tools of IAS and Grapeshot are good for making the OMP as safe, 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 SDK (software development kit) for the technology to work.
The keyword lists need to be so broad that they often cut out quality sites or block access to key users as you can not check a longtail of 2,000 or more sites for editorial standards. This leaves brands vulnerable in the OMP.
OMP issues:
- 50 per cent of media value cost is ‘lost’ to the supply chain
- Third-party data is typically of poor quality
- It may be hard to scale reach with a key publisher
- Ad fraud might be limiting return on investment and exposing your brand to danger
- Brand safety issues are hard to combat
So what changes when you buy in a deal with SCMP?
Increased buying transparency (essential for SPO)
With fewer intermediaries, we are able to have more control and transparency. This allows us to pass important buying information back to the buyer and optimise the campaign to the chosen KPI (key performance indicator) 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 set-up.
Deal management & support from SCMP Ad Ops
This is a lost art these days as much of the service layer has been eroded. We have a large team of experienced operations staff that will troubleshoot issues, provide buyers with real-time deal dashboards (with self-service access). Lead regular campaign reviews and deliver best in market, post campaign analysis with beyond the click user level insights.
First-party data with a minimum of 80 per cent 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 and, in addition, it may be obvious to say, but 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 the market-leading brand safety tool. Built directly into our CMS (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 more than 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 1-2-1 audience matching
- No more cross domain tracking
- No more user frequency capping
- No more user retargeting
Deal benefits:
- Increased transparency to drive buying efficiencies
- Direct deals reduce exposure to Ad fraud and brand safety issues
- Access to SCMPs high quality first-party data
- Premium Ad Format access with full reach and scale available
- Persistent IDs to help clients build branding efficiencies
- Best in market support, optimisation and reporting from experts
