What to Consider When Changing Your Adstack Provider

Just a few years ago, everyone had an Adserver and a separate SSP. Today, most Adservers have a holistically optimized SSP built-in while implementing header bidding. Currently, 78% of publishers use header bidding and have an average of 6.5 SSPs integrated, according to The Drum.

The team at Yieldbird (one of the largest publisher-centric programmatic monetization companies in the world) has put together some advice for those considering upgrading their ad-tech partner.

What to consider when changing Adstack Provider? People, Process, Metrics & Data

Before partnering with a new technology provider, it is vital to review your internal processes and capacity. Changing Adstack providers is a challenging task. Before we began, I asked our publishers about these four important elements and this is what we learned: 

• People – Do you have enough available internal resources to begin a large project? You might need to consider hiring more people or enlisting a consultant. Are the roles between your team clear? Review this and clarify with your future tech-partners who is responsible for what within your organization.

• Process – Devise a GANT plan, where you analyze all organizational activities and create a realistic timetable with clear processes. Otherwise, there is a risk that your tech-partners; who have various other projects, afford you less priority without the right plan in place. Speak with your staff about their opinion on the potential provider, there is likely useful knowledge from past experience. 

• Metrics – It is necessary to define and decide upon your KPIs. Keeping at least 6 months of historical performance data will be valuable in assessing growth once you change your provider. It is recommended to implement a minimum acceptable indicator to know where improvements must be made before panic sets in. The change of technology often creates a short-term downturn because the demand needs to realize that your inventory is now at different providers than before.

• Data – The important thing here is to have a big picture and determine what data sources are generating your metrics. Keep in mind that the goal is for your TOTAL digital advertising revenue to increase, including the direct sales revenue. Changing ad-tech partners can lead to negative redistribution. For example, if you increase your revenue from OpenMarket with the help of new partners, it should not be at the expense of your direct sales revenue. It will help to redefine your strategy on how you onboard all IO and PMP campaigns. Establishing a reporting structure where all data sources are grouped is necessary to maintain a good overview of your Adstack. By ensuring that the measurement data is available, you can quickly identify if you’ve missed any parts of the migration. 

What level of service do you expect or demand?

All publishers have different support needs from their ad-tech partners. Some providers offer a more SAAS-like model where a lot of the work is inputted manually. Other partners have a high level of service, although these platforms are often associated with a higher initial outlay. For this reason, it is important to consider your organization’s capacity and profile.

Many major publishers connect their ad-tech systems with other internal and external systems. If you go down this path, you must check with the intended partner exactly what support they provide and how their API specifications look. Doing your homework is critical in this area as without a good API, many interconnections are impossible to implement.

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Gain an advantage thanks to the first price shift

It’s crucial to define your yield strategy based on the first price shift. Over the past year, programmatic auctions have switched from second-price auctions to first-price auctions. The idea is to simplify the process for advertisers and to create a more transparent environment.

For the publisher, the challenge is always the same: finding the price that optimizes revenue for the short and long term. You need to manage the prices as any other business would, without this you cannot maximize the revenue.

The graph above illustrates what happens if you don’t manage your pricing in a proper manner. Several providers claim that if you decrease your floor price, your revenue will increase with first-price auctions. This isn’t entirely true since DSP (advertisers) currently use bid shading. DSPs are able to learn they can buy cheaper from you and will increasingly do this until you prevent it.

For publishers with a large direct sales staff – low OpenMarket prices may eventuate in an internal price conflict. My advice is to define your first price strategy and how to achieve maximum revenue. During the last year, my colleagues in the data science team explored and discovered a way to secure highly stable revenue in a first-price market.

Understand what you are paying for

There are both hidden and visible costs among Adtech providers. Make sure to review all intended suppliers and request that they explicitly detail all costs and a statement to confirm that there will be no hidden costs. One detail to consider is the “hidden” currency conversion cost; find out which currencies are affected, including exchange fees.

It is not uncommon for the currency to be converted several times and you lose several percent – with no reference to this occurring. Revenue sharing and CPM were usual costs for a long time, but nowadays there are different revenue shares depending on whether it is OpenMarket or PMP/PD. Some technology providers also offer completely fixed costs. Count on what is beneficial for your business.

Any needs for special reporting?

Some of our customers have internally developed a link between their systems and can, for example, easily add a new header bidding partner to incorporate analytics. Other customers do not have these technical resources and require clearer analytic systems from their technology suppliers. All technology companies brag about their functionality, so it is an idea to make a questionnaire about what unique functionality you can receive from the supplier. This questionnaire should be attached to the agreement and will help you to narrow the competition. 

Trust, but verify

This famous quote often used by former US President Ronald Reagan fits the programmatic world suitably. All technology providers have standard contracts, which are often unilateral. If you have agreed to special arrangements, make sure that this is in writing on the first page of the document. Set the date when these expectations must be met and what compensation or consequences will ensue if the provider does not satisfy the criteria.