Top trends that will impact SPO in 2020

Tue, December 31, 2019

Top trends that will impact SPO in 2020 Adslot

Tue, December 31, 2019

2019 was a big year for supply-path optimization and premium media buying, and some experts believe 2020 will have even more impact on SPO and media buying entities. Here are five trends to watch for the new year.

The rise of SPO will force SSPs to incorporate more services to stay relevant.

“In 2019, header bidding created bid density and therefore higher prices. And that, coupled with the shift to first price auctions, has left buyers feeling like they’re paying too much for inventory via SSPs,” said Charmagne Jacobs, VP/Head of Global Marketing and Partnerships, Adslot. “Publishers, however, believe that SSPs have increasingly catered to DSPs to ensure the demand (allowing optimizations that have resulted in bid-shading), which has created downward pricing pressure on all. This, plus the need to reduce the number of middlemen (which triggered safety and tech fee concerns) has led to the rise of SPO. Now, smaller SSPs will get squeezed out and need to find other ways to stay relevant and provide value beyond yield management – possibly even serving as the data hub for buyers.”

Swing back to context.

“The reduction of third-party cookies has further diminished the accuracy of third-party data, which has been a core use-case for media campaigns that aren’t long tail. Coupled with concerns around high-tech tolls, transparency, fraud issues and brand safety concerns, media budgets are shifting to more secure executions where buyers can work directly with the premium publishers who own the hearts and minds of their audiences. Premium publishers curate trusted audiences that are meaningful for advertisers, especially when they want to purchase programmatic inventory in a safe, well-lit and relevant environment,” said Jacobs.

Shift toward more premium programmatic executions.

“Faced with pressure from clients demanding more transparency and better inventory, agencies are moving more deals out of the open auction and into the premium and direct buy types of PMPs and PG. This shift allows them to apply the programmatic fees, while also allowing for safe, efficient and transparent programmatic media buying. Of course, this doesn’t mean that open exchanges are going away. Rather, we’re seeing segmentation in the way that advertisers do their buying. Open exchanges are going back into the rightful position of monetizing lower value, remnant and longtail inventory. Meanwhile, upper-funnel activity is moving back to more premium executions and strategies now that the technology has caught up with the market,” said Jacobs.

First-party data will be king.

“Given current concerns, first-party data will become more important to programmatic buyers, for several reasons. First, marketers are increasingly concerned about consumer privacy as regulations like GDPR and CCPA install stringent rules over what can and cannot be collected without consumer consent,” said Jacobs. “This also ties into the demand for transparency from marketers, who want to know that the data they’re using isn’t just privacy-compliant, but of high quality. Last year, a Lotame study confirmed this, finding that data accuracy is the most important factor among brands when considering audience data. Second, browsers like Google, Apple and Mozilla are cracking down on third-party cookies, creating new barriers to data collection and consumer targeting. As a result, first-party data, which isn’t always as scaled but which offers quality and visibility into its origin, will be critical for use in programmatic and automated-buying environments.”

Zero-party data has arrived.

“With more power shifting to consumers and ever-growing concerns about privacy, marketers are creating opportunities across the ecosystem by turning their attention not just to first-party data, but zero-party data. Whereas first-party data is “passively” collected consumer data from websites, apps, social platforms, etc., zero-party data is proactively and willingly shared by the consumer. Examples include purchase desires and preferences through interactive experiences like subscriptions, surveys and loyalty programs, etc. It’s completely opt-in, so we can, therefore, presume a high level of quality, transparency and accuracy. And, as regulators and browser companies continue to tighten up on privacy, zero-party data will be more important for programmatic and automated buys. It has the potential to unlock deeper consumer profiling and targeting. Per Forrester, zero-party data would help marketers “build direct relationships with consumers and improve their product recommendations, services and offers,” said Jacobs.

Article originally published by BizReport.  Please click here to read original article.