Media Buyers Should Demand More from Programmatic ‘Premium’

Steve Pelletier, SVP, strategic partnerships and corporate development, FatTail

The Sell Sider” is a column written by the sell side of the digital media community.

Today’s column is written by Steve Pelletier, SVP, strategic partnerships and corporate development at FatTail. 

Go to any SSP or DSP website and you’re likely to see a mention of programmatic “premium.” Typically, this refers to inventory that comes from top-tier publications such as The New York Times or The Washington Post.

But is connecting buyers with elite publishers the best that programmatic platforms can do? 

As it stands, programmatic premium doesn’t reflect the value of the service or the value-add of the intermediary. Plus, even when ad tech companies offer access to elite publishers’ inventory, they do not necessarily offer the best of that inventory. Publishers like The Times sell the majority of their inventory via direct sales. What’s left over is sent to the open market, which ad tech companies then make available. So, even “premium” inventory is not necessarily that premium. 

Ad tech companies can and should provide a premium service to buyers. In other words, providers of programmatic premium should maximize the value of premium inventory, not just supply that inventory.

Here’s what buyers need to know – and what ad tech needs to deliver – to ensure advertisers get something that’s truly “premium.”

Programmatic premium should include direct deals

The Trade Desk captured headlines across the ad tech media when it announced OpenPath, which, in the DSP’s own words, promised advertisers “direct access to premium publisher advertising inventory.” This is a coup for supply-path optimization because it allows publishers to integrate directly with the DSP, providing higher visibility into elite publisher inventory and the impressions it generates. But it’s not enough.

For programmatic premium to reach its potential, it would have to include direct deals, such as programmatic guaranteed, preferred and private auctions – not just open-market transactions. Some of the benefits include selective access to inventory, greater transparency and efficiency, fixed pricing, guaranteed audiences and inventory commitments. 

The problem, however, is that there is currently no technology that allows buyers to survey premium inventory at scale and transact on it via direct, programmatic deals. Buyers can execute these deals, but they rely on a much more cumbersome process that is either wholly divorced from programmatic or deserving of the unseemly term “programmanual.”

There are also cultural hurdles preventing ad tech and media buyers from realizing the full potential of programmatic premium. Publishers may be hesitant to expose products, inventory, and pricing for high-value deals in a semi-public forum. Buyers are also used to the efficiency and ease of the open market and may not trust they will get that same efficiency via deals.

There’s no reason to stick with the status quo

Despite the challenges, buyers, sellers and the ad tech industry should not be content with the status quo. The open market wrests control from publishers, diminishes inventory value, introduces brand safety and fraud concerns and excludes buyers from all the benefits of direct deals: fixed pricing, guaranteed audiences and more.

There is no technical law barring the ad tech ecosystem from providing buyers all those direct deal benefits with the ease of use of the programmatic open market, nor from allowing publishers to maximize the value of their inventory by exposing products, inventory and pricing for deals in a programmatic marketplace. 

There is no law stopping programmatic premium from reaching its full potential.

Perhaps the question is simply whether buyers are able to visualize – and demand  – what’s possible.

Follow FatTail (@fattailinc) and AdExchanger (@adxchanger) on Twitter.

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