Reed Smith formed part of the core team drafting the seminal ANA Programmatic Media Supply Chain Study. Our “RS Ad Bites” break down each of the findings and deliver the key considerations for marketers to think about to protect the bottom line and increase efficiency when dealing with agencies and vendor partners in connection with programmatic media buying. 

Below is the fourth in our series. The full report can be found at ana.net.

SSP Optimization 

Marketers should have a supply-side platform (SSP) strategy to improve efficiency, transparency, and scale. Many publishers use SSPs to sell inventory to multiple exchanges, networks, and demand-side platforms (DSPs) simultaneously. DSPs often connect to more than 50 SSPs. Bidding on inventory through too many SSPs can increase costs because the advertiser may be bidding against itself. Each advertiser in the study used an average of 19 SSPs. The overall range of SSPs used was between 9 and 53. By stark contrast, the Association of National Advertisers (ANA) estimates that the optimal approach is to use just five to seven SSPs. This, the ANA notes, “can provide access to close to 100% of supply across web, mobile app, and CTV environments.” 

Whether an advertiser opts to have direct relationships with SSPs or delegates this to its media agency, focusing on SSPs that most closely align with the advertiser’s key performance indicators (KPIs) is crucial. SSPs vary significantly, for example, the ANA found that:

• SSP fees may range from 5% to 20%; 
• the percentage of Made-For-Advertising (MFA) by spend varies from 1% to 70%, with some SSPs also having a high percentage of rebroadcast [1] programmatic media (which typically has long supply chains that result in higher fees and carbon footprint);
• the percentage of SSP revenue paid to publishers varies from 40% to 83%; and
• the percentage of publisher inventory that SSPs have direct access to varies from just 13% to 97%. 

This means that reducing the number of SSPs that an advertiser works with can have an impact not just in cutting wasted expenditure but also in increasing the number of quality ad impressions. Having close business relationships with a smaller number of SSPs also allows for closer monitoring of the ad spend and inventory, which in turn helps to drive efficiencies. 

Playbook / key considerations

1. Quality over quantity: tailor your SSP shortlist based on your KPIs and desired transparency to avoid wasted expenditure. Five to seven SSPs are optimal and provide access to close to 100% of supply across web, mobile app, and CTV environments. 
2. Pay for content on your inclusion lists: work with counsel to ensure that under your DSP and/or SSP agreements you only pay for inventory bought on your inclusion list of named SSPs and publishers. Work with your DSP and SSP to ensure that any automatic-buy settings are configured to only support these shortlists. 
3. DSP due diligence: when determining which DSPs to work with, review the DSPs’ publisher-partners’ acceptance standards and policies for SSPs. This will help you to direct ad spend away from MFAs (if not part of your strategy) and pricey rebroadcast programmatic media. Reviewing these acceptance criteria will also help to inform you as to the availability of direct premium inventory supply and also transparency data and tools, which is key to tracking your ad spend. 
4. Monitoring and training: provide your procurement team with up-to-date training from media specialists or outside counsel to arm them with the knowledge to: (i) negotiate with SSPs and DSPs in order to maximize ad spend efficiency and increase transparency and controls; (ii) monitor implementation of performance; and (iii) enforce your contracts and – where there are performance issues – ensure you have make-goods that have teeth.

[1] Rebroadcasting is when the DSP is more than one “hop” away from the final ad serving decision by the publisher.