Commentary

What's Really Fueling The Rise Of PMPs?

It’s one of the biggest headaches in our industry -- yet, for some reason, most brands have suffered through it. You know the one: Your team was sold on the idea that the demand-side platform you’re working with has access to high-quality publishers and can get you premiere placements -- and then you find out where your ads are actually running. Far too often, it’s not a flattering story.

Private marketplaces (PMPs) were designed to give advertisers using programmatic platforms the means to access premium inventory in fixed-price environments. However, brands are increasingly discovering that their ads aren’t serving on the marquee sites they thought they were.

Thus, planners and buyers are tasked with making a tough decision: purchase high-quality inventory on specified sites, which may not scale, or trust the PMP to secure verified brand safe inventory, but at the cost of an ad appearing on a site they may not recognize -- or worse. For modern traders, success is commonly found in shades of gray.

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To optimize the perceived quality of programmatic, marketers are scrutinizing the long-tail inventory commonly provided from leading supply-side platforms (SSPs). They are demanding nothing less than high-quality inventory and respectable publishers that can guarantee the best ROI. For advertisers, it’s time to demand complete transparency. For publishers, it’s time to come clean and get creative to appease contesting goals.

As transparency becomes a high priority across the advertising landscape, more brands and agencies demand to know exactly what their media investment is getting them. On top of that, brands and agencies are increasingly empowered with reporting tools and verification companies that enable them to validate the inventory they were promised. Modern technology layered on legacy operating models is not only exposing questionable business practices of the past, but also shining a light on a few technologies dedicated to transparency and client value.

As the lines in ad tech continue to blur, it’s important to keep in mind the notion that “high-quality” inventory is quite subjective. For example, we (as advertisers) all want to serve ads to specific consumers in the right context on premium sites, but does it really matter? Certainly the context and placement of ads are important, but that doesn’t necessarily mean context or placement need to be on a super-premium publisher’s site to reach a desired outcome for direct-response goals. Heck, even branding goals might be better achieved on more niche sites.

Think about it this way: One person might regularly visit CNN.com, but they might also visit RottenTomatoes.com. CNN is the more desirable placement, but it’s still the same person visiting both sites. And that person still has the same propensity to convert on an ad; it doesn’t matter where you find her.

PMPs, by their nature, put more money in the pockets of publishers because they’re built around exclusivity and this notion of quality. But high CPMs don’t necessarily correlate with conversion or return on ad spend. Savvy agencies and brands recognize that the right technologies help them locate and reach the right people in less-expensive environments.

None of this is to say PMPs shouldn’t play a role in your media planning. They should. It’s just critical to understand your (or your clients’) goals and objectives before devoting spend in this way. Be sure to evaluate the use of PMPs as an optimization tactic, and a means to balance “placement prestige” vs. performance outcomes.

Also, don’t discredit less visited publishers. While transparency has done wonders in terms of informing marketers about the true value of their media spend, it has also harmed the perceived value of supply that might not be located on highly trafficked publishers’ sites, but still has the ability to reach the right people.  

Finally, if your partner is not willing to show you exactly where your ads were placed and how much they made, there is a better partner out there to work with who values transparency. Find your balance, work toward what gives you ROI, and settle for nothing less than complete transparency.
1 comment about "What's Really Fueling The Rise Of PMPs?".
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  1. Steve Lozic from shopkick, September 11, 2018 at 5 p.m.

    A qualified audience is paramount, but is there any hard data to support the claim that contextual relevancy & alignment is completely irrelevant a not a valuable factor in consumer decision-making? "Think about it this way: One person might regularly visit CNN.com, but they might also visit RottenTomatoes.com. CNN is the more desirable placement, but it’s still the same person visiting both sites. And that person still has the same propensity to convert on an ad; it doesn’t matter where you find her." 

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