Buyers Demand Supply Path Optimization to Maximize Every Advertising Dollar

Post on November 26, 2019 by Susan Wu

Susan Wu
Susan Wu Director, Marketing Research

The advertising industry is calling for greater transparency and efficiency as programmatic buying is becoming more complex and offering additional choices over where, and how, to access inventory. Supply path optimization (SPO) has come to the forefront of the industry dialogue to address these needs, and ultimately help buyers find the most effective and optimal path to reach their target audiences.

Implementation Methods Differ by Market

PubMatic commissioned Digiday to investigate how US and UK media buyers are approaching SPO, what their biggest benefits and concerns are, and what an effective SPO model looks like. The studies found that most buyers are already well into their SPO journey; 93% in the UK and 73% in the US, are “actively implementing” SPO or “plan to within the next 12 months.” However, buyers employ SPO differently across markets. American buyers tend to rely on algorithmic tools more heavily than their British peers, with 46% of US buyers employing algorithms beyond standard bidders, and only 7% in the UK.

 

The difference in SPO application also reflects where the implementation takes place. While buyers can employ at various levels of their supply chain, 71% of UK buyers implement through an agency and 13% at the brand level, whereas the figures are 52% and 54%, respectively, for US buyers.

SPO Spurs Innovation and Better Partnership

Transparency is table stakes in the SPO conversation, but it is not the silver bullet to a more efficient ecosystem. Buyers are evaluating, and ultimately leveraging, their SSP partners for SPO purposes across a variety of competencies; fraud and brand safety controls, PMP capabilities, and the ability to impact their roadmap are the top priorities for both UK and US buyers.

More than removing bad actors and duplicative bids, SPO has a greater impact to the programmatic buying ecosystem – improved partnerships between advertisers and vendors are sparking innovation and tightening communication channels. The research shows that 88% of buyers are actively innovating and building products with SSPs, and 51% communicate more with their SSP partners as a result of SPO.

For more valuable insights into the state of SPO in the US and UK, and what they mean for advertisers and publishers looking to navigate the evolving landscape, head over to our reports page for the complete studies.