“The Sell Sider” is a column written by the sell side of the digital media community.
Today’s column is co-authored by Bidtellect COO Jason Boshoff and Craig Aron, EVP of strategy and business development.
If you’ve looked closely at the programmatic ecosystem over the past couple of years, you’ve probably noticed that traditional SSPs have evolved from publisher-centric technologies to demand aggregation businesses, often competing with their biggest customers: buy-side platforms or DSPs.
While SSPs had traditionally been among the first in the ad tech ecosystem to build profitable businesses, their future in the programmatic tech stack is uncertain.
SSPs could be left behind if they don’t get ahead of these industry trends:
Full cost transparency
Typically, transparency across a self-service programmatic buy degrades the second an auction/impression is won. That inventory cost is bundled and reported as media costs, which gives significant latitude to participants in this part of the supply chain. Outside of sellers.json, there is very little insight into the number of hops, margin taken, rev share deals with publishers, and SSP take rates.
Global placement ID (GPID)
Currently, one impression from a publisher is sold via up to three header-bidding tools and five to 10 SSPs across dozens of DSPs, creating a cesspool of waste. One DSP could be bidding against itself multiple times in the same auction for the same impression through multiple paths.
This drives the price of the inventory above its intrinsic value, and over-rewards a single constituent in the ecosystem. GPID could be the ultimate equalizer. If each publisher impression could be distinguished by a unique ID, then bid density would decrease, and cost efficiency and performance would improve.
Media sustainability
While full cost transparency and GPID may not be major priorities for brands and agencies, they would be foolish not to recognize that consumers are paying attention to their carbon footprint. The majority of waste in the ad tech supply chain could be reduced by removing multiple paths to the same impression via RTB. Carbon measurement companies like Scope3 are emerging to illustrate emissions data and ultimately reduce emissions.
Prebid and header-bidding advancements
Header bidding killed the waterfall star. In the past, it was necessary for publishers to work with multiple SSPs to ensure they were getting access to all of the demand. SSPs were able to secure priority placements within the publishers’ waterfall monetization stack based on their demand and relationship to the publisher.
But advancements in the standards of Prebid and header bidding have begun to render these functions of a traditional SSP obsolete.
Direct to publisher
The launch of The Trade Desk’s OpenPath initiative was a critical moment for the ad tech industry, but it was not the first DSP to bid directly into publisher inventory. Google has done this for years with DV360, while Criteo was one of the first DSPs to bid directly into a publisher’s header back in 2016. Additionally, Amazon, Yahoo, Xandr, Freewheel, and Tremor all have both demand- and supply-side businesses.
Ad management platform emergence
Most SSPs have shifted away from focusing on providing tools to publishers to generate yield, better ad rendering and other optimizations.
SSPs also buy a considerable portion of their inventory through resellers. Their economic models incentivize this behavior.
This gap in the market has led to the development of new tools designed to help publishers with everything from their monetization stack to workflow automation.
The future does not fit the past
To be future-proof, the traditional SSP has to evolve from its primary function of demand aggregator and focus on collaborating closely with other players in the space:
- Develop technology and tools for publishers that create efficiencies in their ad stack and enable positive experiences for their consumers.
- Amalgamate supply-side tech with a buy-side participant, consolidating the ecosystem to create greater efficiencies for buyers and sellers.
- Collaborate more closely with DSPs to create more value for buyers and improve long-term yield for publishers.
If you’re an SSP, the future is already here. Are you ready?
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For more articles featuring Jason Boshoff, click here.
