When Companies Combine More Quickly Than Their Ad Tech

January 2, 2018 — by MediaMath    

What happens when the consolidation of media businesses—either through mergers and acquisitions or commercial partnerships—takes place far more quickly than that of those companies’ underlying ad technologies? You end up with multiple paths into what is now known as a single commercial entity, each with its own advantages, challenges and performance characteristics. The result is that our buying pathways into that media property can represent a spaghetti bowl of legacy brand supply access, a jarring difference from the single voice with which the new entity now speaks, at least publicly.

Because these kinds of consolidations and partnerships have become commonplace, this phenomenon underscores the need for “always-on” supply path optimization (SPO). While we know that different supply paths can often have differing performance attributes, and thus there is justification to maintain more than one authorized pathway to the user, each path should always be rational: each of our roads to that user should be prepared to defend its existence at any time. Unique access to supply is ideal, complementary access is sometimes useful and duplicative access is a problem.

To solve for this, we simply go back to our principles around supply path optimization:

  • Wherever practical, we want direct access to the underlying impression—that is to say, no intermediaries between the DSP and the user. Although there are some legitimate exceptions to that rule, being strict about this approach helps reduce fraud, improve performance and minimize the inefficiencies that come with unnecessary bid requests
  • Determining which is the best point of access when there are multiple legitimate paths can sometimes be tricky: often there won’t be a single best path but rather a small handful of acceptable routes. Potential factors here include differences in user match rates and in user session depth between otherwise like buying paths. In MediaMath’s case, our intelligence layer will determine which of those is appropriate for different marketer objectives and help make a valuation decision to meet those goals
  • Communication with the supplier is key. SPO is not something that can be solved with only a spreadsheet or only with automation. The supply source’s team should be able to provide insights about the planned future state of how they will merchandise their inventory, including which legacy paths will be deprecated. Working closely with that team can help promote stable and performant access to supply, and avoid unnecessary swings in volume or outcomes as the supplier rationalizes their buying onramps

Consolidation and partnerships among media and ad tech companies have been going on for a long time, and there’s no reason to think it won’t continue. By exercising good supply pathing principles, digging in and really understanding ideal routes to the user and working closely with the supplier, we can help our clients stay ahead of the curve and ensure that they are continuing to make the right valuation and buying decisions.