DATA, DATA, EVERYWHERE...

If you are all at sea about DSP’s and are drowning in a pool of new data then this piece is for you. A few years ago it was said that the people with the most data would rule the world. Now everyone in online advertising has heaps of web user data and if you want even more it’s not difficult to get. It’s got to the stage where we are all using the same data - we’re just slicing it up in different ways. But is more data better, or is some data better than others and what exactly do all these ‘data companies’ actually do?

Who feeds the DSPs?
The ease at which anonymous user data can be gathered and traded online has given rise to any number of suppliers who have been buying data, organising it and selling it on to a variety of eager buyers in agencies, ad networks and ad exchanges. These data aggregators accumulate data from a number of online and offline sources (such as surveys, retail records, lead generation companies, travel booking websites) and package them up into groups according to lifestyle, demographic, industry, company size and so on. They then sell this to anyone across the entire spectrum of ad inventory managers – from DSP companies to ad networks, exchanges and yield optimisers. Some of the major players in this business include Nielsen, Bluekai, Exelate and Experian.

This recent proliferation of data suppliers has given rise to more and more companies who use this data to enhance inventory quality and offer it to advertisers. They are loosely termed Demand Side Platforms (DSPs) and they add a serving and optimization layer on top of aggregated inventory and data sources. Advertisers can access this data via desktop interfaces that enable web audiences to be bought conveniently and efficiently. DSPs can be roughly divided up into these two groups – but some companies perform both functions.

Audience trading and optimisation companies. Enable agencies to buy specific inventory from a number of sources (including across ad networks and exchanges) to create their own custom networks for advertisers and optimise that data during a campaign. Companies include B3, Cadreon and Vivaki.

Bid optimisers.
Allow advertisers to bid for unsold or undervalued inventory on an impression-by-impression basis, across ad exchanges. The inventory sellers get guarantees that the impressions will be sold for the highest bid price above the specified reserve. Companies include appnexus, Dataxu, MediaMath and invitemedia.

While the emergence of DSPs is great for advertisers in many ways it does mean that almost everyone is using the same pool of users and any (anonymous) information associated with them. While rates might be low, so is the inventory quality and the agency has to train staff to manage the systems and optimisation – and take the media risk relating to placement, delivery discrepancies and click fraud. This potentially offsets the efficiencies that attracts advertisers to a DSP solution in the first place. And, of course, DSPs are not free.

What now for adnets?
It remains to be seen how readily UK agencies embrace DSPs and how this affects the existing ad network landscape. Undoubtedly some of the bigger agencies will test and begin to use DSPs for some campaigns and some ad networks will suffer as a result. One thing that won’t change is advertisers thirst for unique, premium inventory combined with great segmenting and optimising technology plus, of course competitive rates, detailed campaign reporting and great customer service.

These attributes remain in the hands of ad networks with exclusive inventory deals and the latest tech – ad networks like Crimtan.