A Programmatic Vision for Private Exchanges

September 02, 2016

opinion

The recent Global Mobile Programmatic Trends Report for Q1 2016, suggests that mobile is now aligning with the most established advertising channels. With mobile programmatic now a fully fledged digital channel and a highly successful force in its own right, some say that part of the revenue growth from high-impact inventory is the result of the rise in the number of private exchanges. Noelia Amoedo, CEO, Mediasmart agrees with this statement. Writing exclusively for ExchangeWire, Amoedo explains why private exchanges might be driving this growth and how the use of private exchanges needs to become more automated to ensure efficient inventory discovery.

Private exchanges have made many publishers feel more comfortable with the whole programmatic world and in many cases have been the reason why some premium publishers have decided to ‘go programmatic’. They definitely allow for a less ‘shocking’ transition than going straight to open auctions, at least from a perception perspective. As the ecosystem matures and the open marketplace starts to fully reflect the prices from true market demand, we’re likely to see an increasing amount of inventory going through open marketplaces but, today, private marketplaces are not to be ignored.

For now however, there are many things that still remain to be done if we want private exchanges to be more ‘automated’, so that we don’t recreate the inefficient legacy ways of planning all over again.

In mobile, the purchasing tools currently available make the process of discovering inventory in private ad exchanges rather inefficient and, as a result, publishers will still need to sell to advertisers directly if they want their very good and more expensive inventory to be noticed. The majority of mobile-first SSPs don’t even offer an online discovery tool. In fact, most information about available inventory on private deals is typically presented in spreadsheet form and shared on demand or on an ad hoc basis with potential buyers. Even in those few cases where there is an online inventory tool, they tend to differ for each SSP, so potential purchasers must log in into different tools to gain a view of available inventory.

We need discovery APIs for demand side platforms to be able to build comprehensive tools that give an immediate view to advertisers of what’s available. In the case of mediasmart, of the 27 exchanges we are currently connected to, only three offer part of what is needed, with only a further one or two planning to make it available in the medium term.

With so few providers making these available and no industry standard being proposed, even if SSPs start to make discovery APIs available, they will each develop their own API, so development is going to be complicated to manage and maintain for any DSP that connects to a lot of SSPs.

Until standard APIs are ready and demand side platforms integrate them within comprehensive tools, the process of buying on private exchanges will remain a manual one, with advertisers contacting publishers or their SSPs directly, exchanging emails and phone calls or looking at excels – a situation that is very far from what is expected in a programmatic world.

Read More in ExchangeWire

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