Publishers and Buyers Want More Premium SSPs, Not More Demand

Corners of ad tech are having another rough few weeks. Supply-side platform EMX filed for bankruptcy. The following day, Yahoo said it was shuttering its SSP and laying off more than 50% of its ad-tech employees. TripleLift, which had been struggling with its branded content division and differentiating its connected TV offering, sources told Adweek, laid off staff last week. Execs are also posting about layoffs at ad-tech firm Criteo, which operates an SSP and demand-side platform, and is in search of a buyer. Criteo declined to comment. This culling is likely to continue as more ad tech players get squeezed ahead of cookie deprecation, especially if the tech vendors that package and sell publishers’ inventory to advertisers can’t meet new industry expectations, more than half a dozen industry sources told Adweek. “There’s no reason to have multiple dumb pipe SSPs," said Scott Messer, consultant and a former executive at publisher Leaf Group. "There are reasons to have multiple smart pipe SSPs. A product doesn’t need to sell through 10 Costcos, but they would like to sell through several boutique stores,” he added. Publishers and marketers want more than a connection to the open internet: they’re asking for superior tech, speed and adaptations for third-party cookie deprecation. Yahoo Shutters SSP and Narrows Focus on Ad Buyers SSPs maximized bid density over tech For a while, and especially since the advent of header bidding, the common notion had been that more demand was good for publishers, even if that meant duplicated bid requests and inefficiencies, said Justin Wohl, chief revenue officer of Salon. “As an industry, we overstuffed the bid responses,” Wohl said, noting that publishers wanted to work with as many SSPs as possible because they were worried about missing any sliver of demand. “[Anxiety about demand] was an overdeveloped concern.” This made it more important for SSPs to maximize bid density over having superior tech, said a publishing ad-tech source. SSPs that don’t have that differentiation [are in] a race to the bottom. Anonymous ad-tech exec “A lot of these SSPs serve market-making functions which have very little to do with the actual technology," said the source, who was not authorized to speak to the press. As a result, many SSPs require publishers to input gobs of javascript on their page, leading to slow webpage loads, slow ad rendering, a poor user experience and, ultimately, penalties from Google search. While industry-leading SSPs, like PubMatic and Magnite, offer huge amounts of inventory, others, like Teads, offer features like bespoke ad units. These ad-tech vendors aren't without their struggles, especially in today's tough economic climate, but those in the middle, where sources said that Yahoo and TripleLift sit, struggle to differentiate themselves as the industry moves toward supply path optimization, which seeks to limit demand, not encourage it. “SSPs that don’t have that differentiation [are in] a race to the bottom,” said an ad-tech exec, speaking anonymously to freely discuss industry relations. “[For an SSP] to be the preferred path for a DSP, if they can’t maintain that over the time, [they have to] lower the take rate, and then someone else is going to come in and undercut them.” Solving for speed and signal loss SSPs hoping to avoid this crunch can become faster at ferreting bid requests between advertisers and publishers with better tech, two publisher sources said. This is especially true in the less developed area of transacting via contextual signals. Wohl said that some SSPs can take 24 hours to find a buyer based on contextual signals. By that time, an article that receives lots of traffic could already be out of the news cycle. “Curations that can be done in real-time will be very valuable,” Wohl said. Yahoo and Amobee DSPs Remove Google Open Bidding as a Source of Supply And as more of publishers’ audiences become unaddressable due to cookie deprecation, SSPs can help publishers and their buyers use other signals, especially by enriching bid requests with contextual and behavioral signals, Wohl said. SSPs can also help publishers test new cookie replacement solutions like Fledge and seller-defined audiences that publishers wouldn’t have the resources to test themselves, the publisher ad-tech source said. TripleLift is already starting to adopt this playbook. The company’s connected television division was not competitive with other SSPs several years ago, two sources told Adweek. Late to the game of grabbing broadcaster inventory, TripleLift has leaned into its proprietary product that helps insert 2D signage and 3D product placements into TV shows, one of the sources said. NBCU recently announced a partnership to use the product. TripleLift did not respond to requests for comment. Less is more While publishers and buyers are both expecting more from SSPs, their interests are not 100% aligned. Publishers are seeking SSPs that make their inventory more attractive, ultimately growing their revenue, while buyers want better and cheaper inventory. “You want to look for exchanges that have the least hops between the publisher and the DSP and fewer fees along the way,” said Kelly McAloon, associate director of programmatic at media agency Good Apple, describing her approach to picking SSPs to work with. While it’s a shift from the more-demand-is-better mindset, many publishers are keen to provide direct paths to try and increase the value of their inventory rather than leaning on auction dynamics inflating bid density. “There is definitely supply path optimization to drive DSPs to orient themselves toward the inventory as best they can,” Wohl said. “As a publisher, I’m into that. Let me give you the cleanest look at my inventory.”