Programmatic ad buying has become the primary method for gaming advertisers to access mobile ad inventory. Last year, global spending on programmatic advertising hit an estimated $588 billion, and it is projected to reach $700 billion by 2026. However, despite its benefits, there are drawbacks to this method.
The evolution of the programmatic supply chain led to publishers transitioning from waterfalling to in-app bidding. This shift maximizes returns by offering each ad impression through a unified auction, providing benefits such as increased competitiveness for smaller advertisers, faster ad loading, and access to a broader range of demand sources like DSPs. Nevertheless, it results in multiple avenues to win the same ad impression.
Due to this, the same ad impressions are offered by different ad networks, leading DSPs to receive repeat bid requests from ad exchanges, artificially inflating prices that are passed on to the advertiser.
Reducing unnecessary costs is crucial for mobile apps, particularly games, as optimizing ad budgets can enhance user acquisition and ensure long-term profitability. Supply Path Optimization (SPO) plays a crucial role in achieving this by streamlining access to high-quality ad inventory.
Enhancing Performance and Reducing Costs Through SPO
Being aware of where your marketing budget goes is essential, and programmatic advertising can help advertisers find value. According to a report from the ISBA’s Performance and Programmatic Steering Group in 2020, 15% of advertiser spending is unaccounted for in the programmatic supply chain. Additionally, SSP fees are on average 2% higher than reported.
Additional costs are a consequence of in-app bidding, where supply-side intermediaries ‘resell’ ad inventory, inflating prices. Ad inventory can be ‘resold’ multiple times, accruing tech fees. SPO strategies that eliminate unnecessary intermediaries from the supply chain offer a direct path to supply sources, reducing costs and improving ROI.
Liftoff’s SPO approach offers an advantage as their Accelerate DSP, powered by machine learning technology, provides direct access to ad inventory from the Vungle Exchange without costly intermediaries. This benefits gaming advertisers significantly, as the Vungle Exchange has direct access to numerous publishers.
Benefits of Supply Path Optimization
SPO not only reduces costs but also enhances ad campaigns in various ways. By optimizing the supply path, ad spend is directed closer to the source, resulting in faster loading times for ads. This reduces data delays, enhances targeting quality users, and prevents loading issues that impact creative quality.
Streamlining the supply path can lead to better ad performance and improved targeting, especially when using a DSP with machine-learning models. Clean data enables Liftoff’s Accelerate to detect valuable bid requests efficiently, increasing the win rate and improving overall performance and ROI.
However, streamlining the ad-buying process can affect the creative options available via ad exchange, so it’s essential to research the SDKs’ supported creative formats.
Liftoff offers a variety of creative experiences and pathways to quality ad inventory, such as compatible long-form video and iterative playables, proven to boost conversion rates for gaming ads.
Choosing a DSP for SPO Excellence
To cut costs and boost ad performance, selecting a DSP partner with a streamlined supply route and fewer intermediaries is crucial. Consider a partner that has strategies to reduce duplicate bids, access clean data, and maintain performance. It’s vital to understand that changes in partners might impact ad formats and creative rendering, influencing performance.
For more information on SPO, Liftoff provides a free guide delving into how it works in programmatic ad buying.
