Nickolas Rekeda
Aug 22, 2019

Why PMPs can help brands break the duopoly habit

Spending for ads on Facebook and Google remains an easy decision. But private marketplaces offer compelling advantages and are overcoming more objections.

Why PMPs can help brands break the duopoly habit

There are no signs of the Google, Facebook duopoly slowing down, even with the on-going backlash on brand safety concerns in mobile apps. When investing advertising budgets, brands might want to break the duopoly habit, and this view is reinforced by countries like Vietnam urging brands to stop spending ad dollars on YouTube to avoid financing anti-state content.

Yet despite well-publicised issues around brand safety, transparency and effectiveness, the duopoly remains a simple way to advertise at scale, with Facebook and Google’s ad revenues growing 40% across APAC last year.

While private marketplaces (PMPs) offer advertisers an alternative to the major platforms, they are traditionally seen as disjointed and limited in scale, particularly when operated by a single publisher. But PMPs are evolving and growing to include large networks of vetted premium publishers, making the supply of quality inventory far more accessible.

For instance, the Singapore Media Exchange (SMX) recently announced the addition of seven new media publishers and marketplace owners across South East Asia, including a video streaming service and an ecommerce marketplace. The Malaysian Premium Publisher Marketplace (MPPM) operates across 10 premium publishers in Malaysia, while the Kiwi Premium Ad Exchange (KPAX) pools inventory from 74 websites to reach 75% of New Zealand’s population. As PMPs expand and become increasingly sophisticated, advertiser objections to using them become less valid, and they present a viable option for breaking the duopoly habit.    

Brand safe environments

PMPs emerged following brand safety concerns around open programmatic exchanges and aimed to provide brand safe environments for advertisers. Because all publisher content is rigorously assessed, brands can be sure their ads won’t end up served in unsuitable environments – including inappropriate content, fake news or hate speech – that could easily damage brand reputation. Equally, because advertisers are carefully vetted before being allowed to join the PMP, messaging won’t appear alongside other ads the brand would rather not be associated with.

The controlled, brand safe environments of PMPs are in stark contrast to platforms like YouTube, which Google admits will never be 100% brand safe due to massive scale and the difficulty in regulating user-generated content. The rapid spread of videos of the Christchurch shootings in New Zealand illustrate just how difficult it is for social networks like Facebook to predict what users will upload, and to control the spread of objectionable content on the platform.

Native ad formats are already considered to be naturally brand safe, so choosing to serve native ads within PMPs can add another layer of safety.

A better user experience

With close to half of internet users across APAC using ad blockers, delivering a positive user experience is essential, and PMPs can help brands achieve this. They can make advertising more relevant, either by using local publishers for local advertising or by offering precision targeting, allowing advertisers to layer their own first-party data with the PMP’s unique audience data to ensure ads reach the most receptive users.

PMPs can also provide innovative, high impact formats, such as native ads, that will engage the user without disrupting or intruding on their browsing experience. Advanced technologies used within PMP environments can even analyse user behaviour, including what they are reading, browsing and clicking on, and then optimise the advertising experience in real time to deliver the best possible results. 

PMPs offer formats specifically designed to present a positive user experience on mobile devices, which is vital in a mobile-first region, where mobile penetration is expected to reach 72% by 2025. The suitability of ad formats for smartphones will only become more important across APAC as heavy investment in 5G drives mobile use. 

Total transparency

The duopoly is well known for ‘marking its own homework’, and isn’t always transparent in its advertising practises, so brands don’t necessarily know whether they’re getting value for money. With PMPs, on the other hand, brands enjoy far greater visibility into how their budgets are being spent and how effective their advertising is. Viewability rates are high, fraud rates are low, and advertisers can benefit from a clear set of third-party verified success metrics that align with their brand KPIs.

PMPs encourage closer relationships between advertisers and publishers which results in greater transparency. For instance, they can give advertisers more control over pricing if they agree rates with publishers up front rather than competing in an open auction.     

In addition to these three benefits, shifting ad budgets away from the duopoly and towards PMPs helps support premium publishers in producing well-researched, independent, creative content. APAC publishers and ad tech businesses outside of Facebook and Google saw revenues decrease by 20% last year, which brings real concerns around the sustainability of online publishing, independent journalism and the production of premium content.

In the past PMPs may have struggled to draw ad spend away from the easy options of Google and Facebook due to their fragmented nature and a lack of scale. But as they grow and evolve they are increasingly delivering premium, brand-safe, native and programmatic advertising at scale, and can help brands break the duopoly habit.


Nickolas Rekeda is CMO at MGID.

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