By: Matt Dearborn, Chief Product Officer of SpringServe.
SpringServe originally introduced ‘ad routers’ for CTV as a way to automate carriage agreements – where a content provider (e.g. Paramount) gives up a percentage of their inventory or traffic to a distributor (e.g. Roku) for ad monetization. As important as that function is for saving time and resources in facilitating a contractual obligation, it undersells the power – and value – that ad routers can generate.
In the face of a number of market shifts – including the deprecation of third party cookies, the power of contextual-based identity solutions, and increasing demand for privacy respecting ads – ad routers can deliver enhanced, privacy compliant and effective custom ad experiences that can help generate higher yields.
Simple solutions to complex processes
An ad router’s job is to ‘route’ inventory based on specific criteria. In CTV, content owners commonly use routers for inventory management, helping to facilitate an increasingly complex universe of devices and carriage agreements. Ad routing gives those publishers control over their inventory, giving them precision and automation in the process of delivering an agreed upon percentage of impressions to their various partners for ad monetisation.
Opportunity (and need) to test and optimize
Publishers need to test and optimize their user experience and improve campaign performance without compromising their own revenues – ad routers have become a valuable tool for this kind of A/B testing and fine-tuning. Using routers, publishers can improve their monetization strategy by testing demand stacks against each other by splitting impressions to see which stack performs better. The options are limitless – publishers can also test tiered demand stacks against a unified auction, try out different optimization and price floor strategies, or evaluate performance changes for new demand partners against an existing demand stack.
The growth in supply and demand for CTV inventory and the innovations in identity solutions makes addressing and reaching the right audiences even more important. In the face of third party cookie deprecation, many solutions are emerging to solve the addressability issue. Rather than a singular solution, the gap is likely to be filled by a mix of first party data, hashed email-based IDs, cohorts, and contextual-based identity solutions – all determined by consumer preferences, regulations, and buyer preferences. For a publisher or broadcaster, being able to systematically test these approaches will be critical to growing their revenue, and improving the ad experience for the end-viewer.
Fine-tuning the ad experience
The business needs of each publisher are unique – managing these needs is a core functionality of ad routing. With routers, a company can seamlessly offer different groups of users an entirely different ad experience. For instance, one company might want to give frequent viewers a limited number of ads per pod, another company might want to show these viewers even more ads. Every aspect of the ad experience can be managed down to the most granular detail.
There’s no doubt that ads are becoming the key focus in CTV, with subscription growth stalling and consumers looking to make cost savings, the industry is looking to innovate and optimize ad experiences. The publishers and platforms that execute the best ad experiences while keeping the needs and experience of the end user in mind will find the greatest success. In order to do that they’ll need to test and fine tune, ensuring ad relevance, acceptable levels of ad frequency, and engaging formats, etc – all of which can vary from user to user. With the injection of actionable intelligence to understand the where and how, and what inventory is being shared, publishers have the ability to customize ad experiences that are privacy compliant, effective and efficient through ad routing.