Four ways publishers need to be digging deeper into revenue optimization
by Tim Sheets, VP of Monetization, OpenX
With programmatic making up the lion’s share of many publishers’ digital revenue, it is even more important for publishers to dig deeper into yield optimizations. That means opening up a slew of programmatic opportunities for publishers to grab more ad dollars. By doing so, we have found that publishers are often able to up their revenue by 25 percent or more.
Publishers looking for that increase should try these four tactics.
1. Level the playing field.
Are all demand partners really competing in the same auction? Legacy ad server configurations prioritized traditional direct sold campaigns above all other demand, including programmatic. This preferential first look access for direct sold often limited competition. With most ad servers now able to manage volume in a more sophisticated way, publishers no longer face the same restriction.
Thus, publishers should consider letting their programmatic platform partners compete alongside traditional direct sold campaigns when the programmatic bid prices are high enough or when publishers have negotiated with the platform to get preferential access. Removing artificial barriers to competition not only maximizes yield but also resolves one of the buy side’s most frequently stated concerns—not knowing how programmatic platforms are prioritized relative to other demand channels.
2. Force platforms to pay a premium for structural advantages.
Programmatic platforms native to an ad server—for example, the ad server’s primary ad exchange—have an advantage compared to the rest of a publisher’s demand partners. They get to see the prices of all the demand partners before competing for inventory. As it stands, these native platforms are not forced to pay a premium for this significant advantage.
To make up for the lack of this premium, publishers should work with external programmatic platforms to boost bid prices in the ad server. The end result will be a more competitive environment and more appropriate pricing for all demand partners. It should be possible to receive two pricing signals for each impression from programmatic platforms. One can represent a boosted bid, and the other can retain accurate revenue reporting.
3. Play matchmaker with inventory attributes and audience segments.
One of programmatic’s biggest benefits for publishers is the ability to carve inventory into very small segments. This goes all the way down to the user level, where publishers can accurately match their inventory and audience profiles with buyer preferences, opening up a number of opportunities for publishers to customize settings within programmatic platforms and increase revenue.
To start, publishers should set floor prices that more accurately reflect the market price of impressions and ad unit sizes. For example, setting a lower floor price for less desirable traffic will increase fill rates without sacrificing the overall pricing strategy.
Publishers should also take a nuanced approach when setting their partners’ timeout thresholds. Visitors arrive at sites through all types of connection speeds and devices, so while it’s important to serve ads quickly, programmatic platforms may need more time to compensate for slower connections anyway. For instance, publishers can set a longer response window for mobile traffic to reduce timeouts while taking user experience into account.
4. Pay attention because the devil is in the details.
If publishers dug deeper into their partners’ bid patterns, comparing bid frequency rates and sell-thru rates across price ranges, they could more effectively determine whether their floor prices were set at the appropriate level. Or when sell-thru rates don’t increase with higher bid prices, it could mean that the ad server is preventing price-based competition for certain pricing buckets and must be adjusted.
Legacy ad servers need to price traditional tag-based demand partners, including ad networks, at a fixed price representing the average amount paid across a number of impressions. Publishers who still have some of this demand kicking around should adjust the fixed prices to account for each tag-based partner’s fill and discrepancy rates. Otherwise, publishers could end up turning down a programmatic bid only to find that the impression was ultimately passed back to the ad server or lost in transit.
So what’s the takeaway for publishers?
Programmatic advertising delivers unique revenue optimization strategies that don’t exist with other ad sales models. Publishers are well positioned to maximize revenue as long as they build optimization into their processes. Publishers shouldn’t get comfortable just because they start generating more revenue—exposing additional areas for revenue optimization may be as simple as digging one layer deeper.
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