Diversify Your Programmatic Bidding

BY: Lydia Borovina, Analyst II
December 11, 2019

Demand-Side Platforms (DSPs) are a powerful tool for advertisers. They offer efficient, instant ad space bidding and buying across multiple exchanges, all from a single interface. DSPs offer wide inventory, powerful targeting, the ability to track and optimize your ads. There are dozens of DSPs out there, and Level Agency recommends starting a campaign by buying through multiple platforms as a best practice.

Here are four reasons to start bidding through multiple DSPs:

1. Test different audience data options. This is the single most important reason to start your bidding through multiple DSPs. Using different third-party lists and targeting options that are available only with certain DSPs helps to diversify audience targeting strategies and also speeds up the process of learning what works.

2. Increases the odds of winning auctions. Each DSP conducts its own internal auction before submitting a winning bid to an exchange. The ad exchange then conducts another auction to determine the winning DSP. While an internal auction for one DSP might lose, another for the same ad impression might win.

3. Maximize your reach, and chances of winning header bidding unified auctions. After the ad exchanges run their auctions, ad publishers can run their own auctions across multiple exchanges. Called “header bidding unified auctions,” these auctions determine which exchange’s winner ultimately gets the inventory. To add another layer of complexity, exchanges conduct 2nd price auctions, where the advertiser pays the price of the 2nd highest bidder. This means that an advertiser could win an exchange’s auction, but still lose the unified publisher auction to an exchange that had a higher 2nd price, even if it is lower than the advertiser’s actual bid. Running through multiple DSPs will help to maximize reach and increase your chances to win these header bidding unified auctions.

4. Open more inventory. Although there is a lot of overlap between DSPs’ available inventory, DSPs cannot always bid on every impression on behalf of every advertiser. Running through multiple DSPs mitigates the chances of losing auctions because the ad wasn’t included in the first place.

Talk to your agency partner about how your campaigns can leverage DSPs to their full potential.

About the Author

Lydia Borovina

Lydia Borovina is an Analyst II on Level Agency's EDU team. She revels in unraveling complex business opportunities and developing actionable marketing strategies to exceed client goals. Lydia loves visiting estate sales with her family and puppy, as well as going on hikes and generally getting outdoors.

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