Megan Reichelt
Sep 30, 2022

Harnessing the power of SPO for programmatic campaigns

As more brand advertising spend flows into the programmatic ecosystem, players on both sides of the industry are beginning to rebel against complexity and demand transparency and efficiency across the supply chain.

Harnessing the power of SPO for programmatic campaigns
The digital advertising industry, especially ad tech, has its fair share of challenges. From exorbitantly high fees for digital advertising to questions about media quality solutions, marketers need to justify their ad spending decisions at every step of the process. Who are you buying the ad from? How much of my spending does the publisher receive?
 
A simple yet effective solution to these questions is Supply Path Optimization (SPO). If you Google the meaning of SPO, it tells you that SPO is about simplifying the supply chain between advertisers and publishers by cutting out unneeded intermediaries and reducing redundancies. In marketer lingo, SPO is about making smarter choices about which auctions to participate in and which ones to ignore.
 
SPO has gained popularity as it allows media buyers to intentionally focus their bids on the most efficient, most scalable and transparent supply paths. As advertisers push for greater transparency in their programmatic buys to ensure that they are getting quality inventory from their ad spend, the clearer the use of SPO becomes. Our esearch has found that 95% of ad buyers are currently implementing or planning to implement supply path optimization technology in 2022.

Let’s take a look at how marketers and digital advertisers alike can harness the power of SPO to increase the effectiveness and efficiency of programmatic advertising campaigns:

When it comes to buying leading ad formats, programmatic is the undisputed choice.

Majority (71%) of ad buyers currently buy social video ads programmatically. This also means that most ad buyers execute half or more of their advertising budget using programmatic technology, especially video in social and mobile environments. SPO helps to ensure transparency in the ad buying process, thus extending the impact of a buyer’s ad spend. According to our research, 95% of ad buyers are implementing or planning to implement supply path optimization technology next year. Of these, 54% say maximising audience reach and scale is the primary benefit of programmatic advertising.

Monitoring global insights to ensure high performance per market

To implement an SPO strategy successfully, it is important to keep track of global and market-level media efficiency. Leveraging market insights to inform strategies allows marketers to change their global strategies and adapt to current trends. As brands try to connect with the consumer, marketers need to leverage global relationships to drive local efficiency.

Leveraging quality and financial data in partner negotiations to deliver better ROI for ad spend

The pressure to deliver value on your ad spend has never been greater as a marketer. As marketers, ensure you are getting the most out of the publishers with whom you spend the greatest amount of budget. Here, use the data to understand where spend is going and use it to negotiate with partners. Advertisers should be mindful of media partners they partner with since the cheapest media partner isn’t always selling the highest quality inventory. This is especially true when using an SPO tool that only looks at cost. Media buyers want to find the sweet spot between cost and quality, to ensure they are only bidding on the impressions that will deliver outcomes and they want to find these impressions at the lowest possible price. Since 42% of ad buyers say lack of transparency is the primary challenge with programmatic advertising, IAS’ Total Visibility, an industry-first solution, provides full programmatic supply path transparency with real-time and impression-level financial reporting to help advertisers optimise their media spending.

Analyse data to set realistic programmatic goals

We live in a day and age where data is the answer to all questions. Similarly, for digital advertising campaigns, brands and agencies must create quality and financial benchmarks for their programmatic strategy. Interestingly, brands and agencies do not see eye to eye when it comes to who should take responsibility for monitoring media quality. When asked about this, 47% of brands and 38% of agencies agree that brands are responsible for day-to-day SPO activities; by contrast, 29% of brands and 38% of agencies believe that agencies are responsible for these tasks. This disconnect highlights the importance of greater alignment between media buyers to fully achieve the benefits of SPO.

Therefore, brands and agencies must work together to optimise digital ad campaigns based on the quality and financial benchmarks agreed upon in their respective strategies.

As programmatic advertising continues to evolve and grow, so will the solutions that help ad buyers see the transparency in the ad-buying process. This will help marketers make better decisions when implementing digital advertising strategies. Until then, the onus rests with brands and agencies to communicate effectively with each other and partners alike to harness the true power of SPO.

Megan Reichelt is country manager for Southeast Asia at IAS.

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