How to clean up the wild-west exchange: an introduction
January 7th, 2020
What is a wild-west exchange? It sounds kind of fun.
A wild-west exchange is a shorthand that describes an exchange without any ‘laws’.
Unfortunately for the good guys, there are people who try to cheat the system, to profit from oversight and inefficiencies—oftentimes on the backs of publishers and companies working hard to provide valuable content and services. The wild-west exchange is fun for the cheaters in the system but less so for the sincere players.
From arbitrage to plagiarized or unsafe content, to bot traffic and sophisticated methods of manufacturing traffic, to ad loads and refresh rates that hurt to look at, there is a lot to manage and filter out.
Why should exchanges bother cleaning up their supply?
We believe that exchanges should take a proactive approach to help buyers and sellers get the best results. There are times when good publishers have settings or bugs that raise flags and exchanges should absolutely be proactive about helping publishers, filtering unsavory traffic, and eliminating inefficiencies that don’t add value. It should go without saying, but exchanges need to be transparent about what they’re doing and why. And with privacy laws and the potential loss of the tracking cookie on the horizon, taming the wild-west exchange will help the industry survive these challenges.
How on earth do you tame an exchange?
I’m glad you asked. Exchanges have a few supply-side problems that have a tremendous impact on how ads perform on a publisher’s site, resulting in lost revenue for publishers and worse campaign results for advertisers. Here are three key ways exchanges can tame the lawlessness:
More granular information about ad inventory
Are all ad placements on a publisher’s website equal in their capacity to get views, clicks, and ultimately drive conversions? The obvious answer is no and that’s because it is the right answer. Where an ad is placed on a site can mean the difference between an ad being viewable on the home page and having non-viewable ads on a subsequent page. Not having granular information about ad placements means the advertiser has limited control over where they appear on a publisher’s site.
Limit the number of ads on a page
Too many ads on a site can lead to bad audience retention for a publisher and increased use of ad blockers overall. An annoying amount of ads leads users to take action against them, which affects the industry as a whole. In addition to poor user experience, too many ads can affect performance. The more ads there are on a single page, the smaller the odds that an individual ad will be clicked. In an ideal programmatic environment, ad inventory is limited to placements that generate results and users aren’t annoyed by an overwhelming amount of ads.
Direct supply over reselling
Buying direct is typically the most efficient route but buying from a reseller can generate strong results. Not all resellers are equal and direct exchanges can be represented as resellers based on the framework being used by the publisher. Some resellers have a higher priority in the publisher ad server, unique formats or data and targeting features. The problem is when exchanges are enabled through multiple frameworks for the same publisher. This results in inventory duplication which is problematic from a tech standpoint––increasing the QPS burden––and allows buyers to have multiple chances of winning the impression, sometimes competing against themselves. Exchanges need to know where inventory is coming from and work with publishers directly to find the ideal framework to achieve optimal performance. They also need to work with DSPs to see what paths are most successful.
Taming the wild-west exchange helps the publisher, advertiser, and the user who views a publisher’s site. As you will see throughout this eBook, taming will have a tremendous impact on many of the top issues plaguing programmatic advertising today and will help the industry cope with the changes of tomorrow.
To read more about how the wild-west exchange affects viewability, privacy law compliance and more,
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