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Bidders and The Commoditization of Programmatic Bidding

Best Practices

Bidders and The Commoditization of Programmatic Bidding

Ben Roodman December 11, 2014

What’s on the mind of every CEO and product manager in advertising digital space? “Should I invest in building my own bidder?” Utilizing a DSP or Demand Side Platform capitalizes on being pre-integrated with the various ad network exchanges, but has the potential downfall of not maximizing the use of first party data or meeting the needs of your own unique bidding optimization strategy.

Today DSPs in the programmatic mobile space have had to differentiate their value proposition by being known for specific features such as GPS verified ad inventory or cross platform tracking. More so, bidding on the same mobile advertising inventory as everyone else still may not generate the performance results best fit for your brand as many of the top performing ad inventory slots are reserved for native sponsorships or direct buy placements. However the use of Demand Side Platforms has increased the price of mobile advertising CPMs despite the surge in impressions available on mobile.  Still the nearly unlimited access to inventory without custom bidding strategies such as location or dynamic user segmentation leaves the mobile advertising market open to commoditization.

A practical alternative to building your own bidder or ad serving platform, is to make use of an API provided by a DSP for implementing your own proprietary business use cases. From here you can use IDFA or Android Advertising ID information passed from the bid request to determine if you want to bid on a particular ad inventory impression using your own data insights. An example may be that you want to personalize ad creatives based on location data or user data from previous lifetime value (LTV) ROI analysis.

Another benefit that may outweigh building your own bidder is using managed services on top campaigns run on programmatic inventory provided by DSPs. If you’re not responsible for optimizing campaign inventory and objectives day to day, you can focus on deeper analytics such as sales measurement and path-to-purchase attributes. You may not know even which forms of advertising or ad network drive the most conversions without trialing an initial mobile advertising campaign. Here you may look at the stats from your mobile attribution partner and then convey this information to your bidding platform.

Overall bidders and DSP technology are quickly becoming flat assets, but doesn’t mean you can’t capitalize on effective business strategies either through use an API or campaign management efficiencies.

Ben Roodman

Benjamin Roodman
Senior Contributing Editor
Benjamin Roodman is an advocate for getting to the truth of what converts in mobile. Well versed in mobile advertising platforms with a notable aptitude and passion for analytics, he's currently putting deals together as head of partnerships at a mobile data startup. Benjamin has previously held Business Development positions at AOL Advertising and helped establish several funded location-based consumer startups.
Follow me on twitter @BRoodman

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