The Rise of Ad Quality

This article is authored by Nishant Khatri, Senior Director of Product Management at PubMatic

This article is authored by Nishant Khatri, Senior Director of Product Management at PubMatic

While the jury is still out with regard to what led to the rapid rise of ad blockers, everyone agrees that low quality ads and the resulting impact on user experience played some role. As a result, many publishers keep ad quality top of mind, and increasingly are looking for tools to enforce the rules that they think are most suited for their readers/users in an effective and efficient manner.

After looking at these macro trends in publisher ad tech, we at PubMatic decided to invest significantly in developing the ad quality platform of the future. Although that was almost a year ago, we’re now seeing the results of our investment in ad quality coming to fruition. But before we discuss the results, let’s take a few minutes to deconstruct the topic of ad quality as a whole.

What is Ad Quality?

It’s important to understand what “ad quality” really means. Many publishers focus on certain aspects of ad quality, such as how many ads to show on a given page. As a monetization partner for publishers, we have a consultative role in helping publishers make these kinds of determinations, but we also see PubMatic playing a bigger role in helping publishers to enforce rules that determine what kind of ads should be delivered in publishers’ various ad slots.

Within that scope, ad quality is largely defined as inclusive of three specific areas (although for a small subset of publishers there are other areas that are also important, for now we’ll just address the following three). Publishers define ad quality in terms of:

  1. The ability to control which advertisers are allowed/not allowed to run on their sites and apps, including specific advertiser names or categories such as gambling or alcohol;
  2. The ability to control which creative types are able/unable to run on their sites and apps. Auto-play video ads are an example of a commonly blocked category based on how it frequently interferes with user experience;
  3. The ability to prevent malware on their sites and apps.

In addition to these three areas, we’re beginning to see other trends emerge as well. Some publishers, for example, want to block certain file types such as Flash ads. Since we are focused on continually updating and improving all of our publisher products, including those for ad quality, all of our product updates and new publisher tools are informed by this type of feedback and knowledge.

Ad Quality Product Principles

Providing publishers with future-proof tools is just as important to us at PubMatic as providing them with tools that help solve the challenges they face today. That’s why we invested in building a next-generation ad quality platform that could deliver on each of the following:

  • The ability to detect problems quickly and efficiently is incredibly important in the real-time environment of programmatic buying and selling. In order to meet this requirement, our platform needed to be fast—almost real-time—a feature that presents numerous challenges from both a cost and a technology perspective;
  • Our next-generation solution also needed to be comprehensive; in other words, we needed to be able to help publishers ensure the quality of every ad—another feature not without its own challenges;
  • In order to be the best possible solution, the platform also needed to incorporate both in-house technology and leverage tech and specialty features only available from third-party experts, which meant that we needed to determine which part of the platform would be in-house and what portion or portions should be left to third parties;
    Last, but certainly not least, we needed to incorporate automation—an extremely important aspect of the platform when it comes to scale and effectiveness.

As you can imagine, these product requirements translated into a whole lot of software to write!

Real-Time Ad Scanning

After seven months of development, we launched our Real-Time Ad Scanning platform earlier this year. Currently we have almost 200 publishers using our Real-Time Ad Scanning globally. The platform has the capability to capture every ad in the bid stream, make automated judgments on thousands of creatives every day (including creative from more than 100 demand sources representing thousands of advertisers), and to annotate each result with a confidence level. The automated process is then supplemented by the efforts of our ad quality operations team, which uses an in-house tool to review the creative where appropriate and confirm or adjust confidence levels.

As with any technology, we measure the success of our Real-Time Ad Scanning by examining the results it produces for our customers. That’s why we were particularly pleased to see an increase in the volume of violations caught proactively as well as an increase in publisher satisfaction overall. Now, after nearly a year of additional investment and fine-tuning, we continue to see even better results for our publishers and continue to expand the various areas of ad quality that our solution addresses based on new trends in publisher concerns.

What’s Next?

After working with about 200 publishers and fine-tuning the product over the last year, we’ll now be rolling the platform out to the rest of our publishers globally, continuing to make changes and updates as additional feedback and results come in. In addition, we are releasing several products and features to reduce response times and give publishers additional automated controls to remove ads that they don’t like—both proactively and reactively.

Publishers invest significantly in acquiring new and maintaining their existing audiences, and as such PubMatic will continue to do our part to help them keep those audiences happy with the best consumer experience possible.

 

To learn more about PubMatic’s Real-Time Ad Scanning and other Ad Quality tools, or PubMatic’s comprehensive revenue management platform, SEVEN, contact your account manager, email info@pubmatic.com or follow @PubMatic on Twitter.

Why You Hate Ad Tech

This piece authored by Evan Simeone, Vice President of Product Management at PubMatic.

This piece authored by Evan Simeone, Vice President of Product Management at PubMatic.

As a longtime software developer and product manager, I value innovation. Unfortunately, innovation and easy, seamless operation aren’t related. Or if they are, it’s often an inverse relationship. After all, what distinguishes an early adopter is a willingness to put up with an incomplete, unevenly polished product simply because it’s new. Ad tech provides unsettlingly consistent examples. The whole industry didn’t exist two decades ago, but in that short time it has evolved and innovated constantly – criticism of ad technology never faults it for its slow pace. So in effect, whether we like it or not, in this industry we are all early adopters at all times; by the time one piece of tech stabilizes and is adopted widely, it’s no longer sufficient and the next new thing comes along. But these are integrated business applications we’re talking about, not the latest consumer gadget. Adopting new solutions is not so simple when you need everything to be connected and interoperable, when you’re trying to run a business at scale, for example. So for all its innovation and rapid change, ad tech quality and effectiveness often seems to be going backwards, at least from the perspective of actual users trying to run actual digital media businesses. That’s why so many people hate ad tech.

To say this poses a challenge for ad tech product developers is an understatement, which is why many in the ecosystem simply choose to ignore it completely. But this is exactly the problem we decided to solve at PubMatic. How can we deliver ad tech solutions to publishers that are at once innovative, high quality, flexible and adaptable to inevitable change? How can we provide a consistent, reliable, easy-to-operate platform that is also radically innovative and flexible?

Two years ago we set about answering these questions. In order to get a better handle on the problem and understand it clearly from users’ point of view, we talked to hundreds of people in the industry—day-to-day users and business stakeholders of all types. We investigated across all regions globally, both on the publisher and the demand side. While we saw a lot of variation in the feedback we received, there was a consistent pattern of frustration with ad technology that is either considered legacy and generic, or niche and difficult to integrate.

Frequently, “legacy” and “generic” were defined in terms of the traditional ad servers that were designed primarily for desktop display inventory, making them poorly suited to today’s multi-channel, multi-format, multi-device businesses. In the category of newer, niche solutions, they cited those that focus only on mobile or native, which may do one specific thing well but are difficult to integrate into a scalable enterprise solution and workflow.

We also took a hard look at our own technology and reassessed every piece of it, both individually and in the wider context of a full, integrated solution, and asked ourselves a few important questions. How completely does our tech address the full spectrum of modern demand channels, screens, and formats? How easy is it to use all together, to operate at scale and to integrate with other solutions? How adaptable is the foundation, and is it flexible enough to deal with whatever tomorrow will bring?

While we were proud of the products we’d built, we quickly realized that in order to solve the bigger problem we needed to rethink how our products work together and how other technologies can plug in. We needed to think of everything we built within the context of a complete, interoperable full-stack solution—one that was at the same time entirely modular, extensible and customizable. Pieces that weren’t compatible with this objective needed to be redesigned and rewritten, while others could be adapted and better integrated.

The main challenge was that everything needed to fit together seamlessly and yet also be decoupled and pluggable. Internally, we used the metaphor of a Lego kit. You can use all the pieces that come in the box and have a complete end-to-end publisher ad tech stack, including direct ad serving, indirect monetization, cross-channel optimization, mobile, native, video, and comprehensive advanced analytics for all of it… or you can rearrange and swap out pieces from other kits to develop endlessly varied, customized and differentiated solutions to meet your needs and easily integrate new innovation.

Developing a seamless full-stack solution that’s also completely modular is, of course, easier said than done, and it did not happen overnight. And I’m happy to say that with the recent announcement of our new unified, modular platform, PubMatic SEVEN, we released exactly that. It was worth the time it took because the investments we made in providing not just point solutions or “pipes” that work, but in refining the workflow and interoperability, the integration points and APIs, made a real difference in the experience publishers have running their businesses. And because the platform is entirely modular and extensible, we have a great foundation to innovate further and to make it easy for our publishers to integrate the innovations of others in the ecosystem.

The exciting part is that although the recent release of SEVEN is the culmination of a couple of years of work, this is really just the beginning. We see the pace of innovation and product development only accelerating in 2017. And because we have a completely modular, well-integrated full stack platform on which to build, we’re confident that future innovation will support easy operation and overall quality, rather than get in its way.

For more information on PubMatic’s comprehensive revenue management platform, SEVEN, contact your account manager, email info@pubmatic.com or follow @PubMatic on Twitter.

A Deep Dive Into Header Bidding

Last month, we hosted our first Publisher Academy of 2016 in London, our 16th so far. Designed to educate and empower publishers to make the most of their digital assets, this time, we delved into the much talked-about topic of header bidding. We kicked off the afternoon with a deep dive into the evolution of header bidding and the landscape as it stands today. This was followed by a view from the buy-side provided by guest speaker, Charlie Ashe, Head of Digital Strategy at VE Interactive, and we rounded off the session with two workshops to really help our publisher partners understand the what, when and why of header bidding.

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Optimizing Publisher Inventory One Impression at a Time

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By Evan Krauss, VP Publisher Development, Americas and
Nishant Khatri, Director, Product Management

It’s been well established that the inefficiencies brought on by the legacy “waterfall” have cost publishers significantly both monetarily and operationally. But even as new ad serving technologies have emerged to solve for these inadequacies, many publishers are still grappling with major challenges around outdated inventory allocation methodologies. PubMatic today released a white paper, entitled Decision Manager: Your Inventory. Your Rules., which outlines the key challenges and solutions in inventory management and monetization, and describes how publishers can leverage a technology platform to realize the full potential of their digital assets.

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Evaluating Publisher Inventory: A Buy Side Perspective

 

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By Emma Witschi and Colin Brown, Platform Solutions, MediaMath

As publishers increasingly migrate inventory sales to programmatic channels, technology providers have emerged to provide publishers with the tools to realize the full potential of their digital assets. One such company is our valued partner, PubMatic, which provides publishers with marketing automation software that enables them to manage their programmatic advertising sales.

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The Impact of Multi-Bid: Decreasing Deadweight Loss

Andrew Baron, Director of RTB and Revenue Operations

Andrew Baron, Director of RTB and Revenue Operations

Last year, we unveiled “multi-bid,” a forward-thinking protocol that improves performance on the buy and sell-side of the ad ecosystem by increasing the volume of bids in the marketplace. We projected the effects, but now we have the data to prove impact as well as lessons learned. The key takeaway is that multi-bid decreases marketplace frictions, which in turn creates efficiency. Said more dramatically (and while wearing a pocket protector), multi-bid decreases deadweight loss.

First a quick review. How does multi-bid work? PubMatic first sends the bid request to DSPs describing the potential impression and DSPs then respond with multiple bids, each of which has a description for potential creative. PubMatic’s system then evaluates these bids against publisher settings and other bids and selects the winner.

Buy-Side Benefits

In a multi-bid environment, advertisers and agencies first benefit from increased inventory exposure or access. We saw buyers increase their participation rate by 40-100%. With this increase in participation, we saw a subsequent increase in the buyer’s importance to the publisher’s business: a 115-130% growth in the buyer’s share of the publisher’s advertising revenue.

From the technology provider’s (read: DSP’s) perspective, multi-bid increases response effectiveness and business intelligence. The best efficiency metric that we can measure on behalf of a DSP is its throughput, as defined by media spend/QPS, which grew 10-15%. The primary driver here is an improved win rate, which grew 45-100%. It’s important to note that a growing win-rate does not just deliver short term ROI benefits, but also increases the DSP’s business predictability. While foresight is a critical piece of building business intelligence, another is learning from past experiences; through multi-bid, DSPs have increased their auction results feedback by 30-40%.

Sell-Side Benefits

With regard to multi-bid, publishers are primarily focused on increased marketplace liquidity. Bid density grew 40-100%, which drove 5-10% growth in fill rates, the end result being a 10-15% increase in publisher advertising revenue. Premium publishers accrued a disproportionate share of value. DSPs used multi-bid to go after higher valued audiences in higher valued contexts, evidenced by a 20-70% price difference between impressions attracting multiple bids and those attracting single bids. Lastly, publishers grew their lost opportunity insights by 30-40%, which is valuable in effectively managing a healthy discretionary revenue channel.

What We Have Learned

How was multi-bid effective? It helped reduce publisher imposed frictions (read: brand controls). In an environment where more bids are available, advertiser blocklists, advertiser category blocks, and even advertiser whitelists could continue delivering strategic value without sacrificing as much revenue. Premium publishers tend to use these brand controls most heavily, and DSPs are aptly concentrating their multi-bid efforts on these high-valued contexts and audiences. Multi-bid value accrues to the industry’s head.

We’ve seen both successful and less successful tactics in avoiding brand control frictions. DSPs should submit a variety of advertisers and advertiser categories in each multi-bid response—in other words, don’t submit multiple bids from the same advertiser and don’t submit multiple bids on behalf of advertisers all from the same vertical, for example.

Multi-bid has proven to be the most efficient means to securing the most valuable content and users. In the absence of multi-bid, a buyer depends on a feedback loop of past actions to achieve future successes. Since publisher brand controls are dynamic, and not always transparent, the aforementioned feedback loops repeat, iterations multiply, and direction forward may not be clear. People and infrastructure costs consequently increase. Multi-bid allows buyers to realize efficiencies ahead of these feedback loops – it’s like learning to fish while eating a salmon dinner.

In conclusion, it’s early days for multi-bidders. It’s still a buyer’s market where early adopters and power users are capturing much of the value created. As adoption and usage continue to grow, we expect to find an efficiency plateau at some point in the future, but we aren’t there yet. Win-rates continue to increase—and do so at an increasing rate—with each additional bid submitted. Said differently, the eradication of deadweight losses is accelerating!

 

To read more about the advantages of a multi-bid RTB environment, you can download our whitepaper: “The Advantages to Publishers, Advertisers and the Ecosystem of a Multi-Bid RTB Environment (Q4 2012).”