How Demand-Side Platforms Will Change Media Buying

Our industry’s in the thick of a love affair, of sorts, with the digital marketing equivalent of the stock exchange – a kissing cousin of the ad networks we’ve long employed to broaden our clients’ reach without also expanding their budgets. I’m talking, of course, about ad exchanges and the value media buyers continue to place on these ad inventory brokerage firms.

Most marketers already know the benefits to working with an ad exchange; it’s the reason why they were willing to give them a try in the first place. Ad exchanges offer placement transparency – something buyers aren’t always assured of getting through an ad network buy. They also provide scale for impression-based and data-driven media buying, and make it easy to manage everything from budgets to bids and frequency caps.

From the perspective of buyers looking to acquire premium display ad inventory, ad exchanges are an appealing choice; the confidence level of these marketers was surely boosted by the Online Publishers Association’s (OPA) recent report that found ads placed on branded content sites “continually outperform other sites, including portals and ad networks.”

Then there’s the issue of data. We’ve seen a major shift in our industry over the past few years from content, context, and behavior-based buys to those built on audience data. Ad exchanges offer the ability to easily infuse buys with valuable information about Internet users and deliver the highly targeted campaigns we’re accustomed to getting from paid search – complete with the auction-based bidding model.

The question for those eagerly employing ad exchanges then becomes how best to manage one’s buys. Enter the demand-side platform.

Demand-side platforms are designed to offer greater efficiency in ad exchange media buys. Each system connects multiple ad exchanges and the online display advertising inventory they offer through a single user interface. In essence, they offer a transparent, cost-effective, automated approach to ad exchange buying, the likes of which has been previously lacking. With access to a demand-side platform, an agency can ensure that it’s getting quality inventory at an affordable price, often in real time. Demand-side platforms offer a viable option for dealing with the frustrating fragmentation that’s now inherent to the online media space.

The Pledge (and Pitfalls) of Automation

Many major agencies have already planted their stakes in the ground around the demand-side platform trend, and others will surely follow. Whereas 10 years ago, a media buyer might be beguiled by a pitch for the benefits of using an ad network (“It will streamline the buying process!” “It will expand your buying budget with low, low rates!”), today it’s demand-side platforms that are offering the promise of a brave new buying world. Marketers certainly have considerable power when they buy their inventory through a demand-side platform; the placements we purchase, the publishers we select, the price we pay, the data we superimpose, the value we place on each ad impression – all of this is within our control.

But there’s something about them that’s giving others pause. Demand-side platforms are primarily about automation – about automating virtually the entire media-buying process. Where does that leave the agency media buyers who used to fulfill these responsibilities the old-fashioned way? If you look closely, you’ll see that what demand-side platforms are in fact doing is reshaping the role that digital media buyers have played for close to 15 years.

To master this technology requires the use of a different kind of skill set, and to use it delivers a very different work experience. These are among the many upcoming changes not all buyers will enjoy adopting, but must if they hope to hang on to their jobs. There’s no going back to the hand-crafted media plans of yesteryear; they would result in campaigns that simply can’t compete with those meticulously structured (and measured) using a demand-side platform.

For those who take stock, however, with evolution comes improvement, and demand-side platforms (and the ad exchanges before them) deliver plenty of upgrades (see Mike Baker’s timeless column for a complete list of key benefits). It’s up to buyers to recognize their value now, and to make the switch to what stands to become the future of media buying.

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