As the ad tech industry rewires itself around the contours of privacy, supply-side platforms are reinventing themselves (again).
In fact, reinvention is becoming something of necessity at this end of the market. Otherwise, those sell-side ad tech vendors would struggle to grow what is an inherently commoditized business — helping publishers sell their inventory to as many advertisers as possible.
But unlike the most recent reinventions, where SSPs were effectively scrambling to become the preferred way advertisers bought programmatic ads from publishers, now they’re trying to be the preferred way publishers scale their data to advertisers.
The reason: As third-party cookies are phased out of advertising, one of the few alternatives to the data they held will be the data publishers own. But the problem with this data is that it can only be used within the publisher’s own ecosystem. Enter SSPs. They see themselves as the ones to bring together multiple publisher’s first-party data so that marketers can buy specific audience segments across those sites — all without mixing those sets together in these privacy-conscious times.
It’s what Magnite was testing in April when it ran its own identity solution on three billion transactions across 30 buy-side and sell-side players including PubMatic, Havas and Adform. The publishers like Hearst Magazines and Condé Nast that participated in the test sorted their visitors into groups based on whether they were interested in areas like sports or fashion. Marketers were then able to buy those segments across the sites of the publisher based on their first-party data.
While the amount marketers spent on those transactions “wasn’t notable”, said Garrett McGrath, Magnite’s vp of product management, it was enough to give a proof concept. Now, it’s pushing that concept further. See the company’s efforts in recent weeks.
Deals have been struck to make Magnite’s identity solution part of the taxonomy task force for the Prebid ad tech industry organization alongside the IAB Tech Lab’s Addressability working group. Doing so, goes the thinking, could help define some of the standards needed to make it easier for marketers to buy specific audiences across publishers and therefore spend more with them. Reaching a consensus of sorts via these groups is key, especially when it comes to a common taxonomy.
The taxonomy is effectively the recipe used to define an audience. Without it, a marketer will struggle to reach similar audiences across different publishers because the way they define what those groups look like varies. But this problem goes away if the publishers have a common way of reporting those audiences. It’s why the Prebid deal is so important to Magnite.
“All of these ingredients are the scaffolding needed for publishers to be able to create and address meaningful audiences at scale from a publisher-led point of view,” said McGrath. “In these ecosystems, the first-party cookies are inherently per site and don’t have any cross-site abilities. Here, it’s the SSP that still has a cross internet view of things.”
It’s a sensitive area for premium publishers. They won’t go near anything that even remotely sounds like it will co-opt their data for shady reasons. Understandably, SSPs are treading lightly.
So much so that Adform has split its own attempt into two distinct areas to allay those concerns.
The first option is straightforward; it gives a publisher the ability to pass their first-party IDs into Adform’s SSP technology so that advertisers can use them to manage programmatic campaigns on those specific sites. For example, a publisher could use these IDs to cap the number of times the same ad is shown to the same person.
Adform’s second option is a bit more complicated; it essentially revolves around publishers sharing the data associated with their first-party IDs. Normally, publishers withhold those details whenever they sell impressions in open auctions, meaning advertisers have to observe how those IDs behave to infer that it’s for the sports fan, for example, that it wants to target.
For sure there are some publishers that see the value in doing this. The reason being that they don’t have big enough audiences and subsequently enough data to power these IDs at the scale advertisers want. However, there are other publishers that are warier of sharing this data, especially if it involves the email addresses readers use to log in. It’s on SSPs to show that they can share publisher data with other trusted companies while ensuring that it can’t be shared anywhere else.
“In those situations, the discussion moves to the commitments and contracts where we make sure that no one can get access to the data unless the publisher says so,” said Jakob Bak, co-founder and chief technology officer at Adform. “If the publisher says so then the data can get linked to other IDs.”
Comments like this normally come from data management vendors; those ad tech vendors in the business of helping publishers define audiences and then sell them to programmatic advertisers. Given SSPs have traditionally catered to publishers it’s not surprising to see them move over into this space. The reality is that SSPs have been moving this way for some time.
Last January, Pubmatic launched an identity hub. It’s a tool the ad tech vendor built on top of Prebid that lets publishers manage multiple identity solutions in the absence of third-party cookies. If a publisher supports any of those IDs then Pubmatic’s tool makes it straightforward for advertisers to buy impressions against those IDs. The rationale being that different marketers will opt for different ID solutions depending on the scenario. Not all IDs work in the same locations, for example.
Understandably, it has piqued the interest of some publishers. As of May, the identity hub had been used by over 175 publishers including Cox Automotive in the U.S. and Time Out in the U.K. Pubmatic expects that number to grow as the market weans itself off of third-party cookies. Indeed, the majority of money Pubmatic makes from helping media owners sell impressions comes from those campaigns where alternative identifiers to the third-party cookie or a mobile identifier are used.
“As time goes by the likely scenario becomes clearer for major marketers, and that is they will need to use multiple routes rather than one alternative,” said Wayne Blodwell, CEO of The Programmatic Advisory. “This is driven through who has access to first-party data and how that can be accessed. The jury is still out on which Privacy Sandbox proposals get major adoption, but this will be only one part of the equation given the aggregated and probabilistic nature of the approaches.”