ChoiceStream, a demand-side platform (DSP), wants to increase the level of competition in the real-time bidding (RTB) marketplace — and not by increasing the amount of demand. Instead, ChoiceStream wants to pit optimization algorithms against one another in a bid to, well, optimize optimization.
The company on Monday announced Thunderdome, its new optimization hub that houses several “competing algorithms.” ChoiceStream asserts that many programmatic ad platforms rely on a single algorithm to select impressions. It claims that Thunderdome instead analyzes “thousands” of algorithms.
Where did the company get the inspiration?
“The complex and dynamic nature of the programmatic space makes selecting one algorithm impossible,” said Bill Guild, vice president of marketing at ChoiceStream. “The algorithm that works well at the start of a campaign isn’t the best when the campaign has collected a lot of data. The campaign that works well for retargeting a restricted cookie pool on remnant isn’t the best for prospecting with broad reach on premium inventory.
"To meet this need, we took a page from the film Mad Max Beyond Thunderdome and created a competitive arena for algorithms. We let them fight it out and the winner rules,” he added.
I reached out to several other DSPs, and most claim to use competing algorithms one way or another.
Said an analytics director at a major DSP: “We don’t think there’s one single algorithm to rule them all, but there should be multiple algorithms all working across different variables depending on the situation. And for some variables, it makes sense to add competition, but for other variables, it may not. In terms of whether more algorithms means a better job … along certain variables, with sensibly designed algorithms, more competition should lead to better performance, though you will likely hit a plateau at a certain point.”
Diminishing returns must surely play a role at some point, but ChoiceStream claims that on test campaigns, Thunderdome has helped marketers achieve a two-times increase over certain benchmarks, though which benchmarks are unknown.
“Certainly marketers can’t all expect these results every time, but our data shows significant improvement from Thunderdome,” asserted Guild.