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DSPs have evolved and have become much better at targeting people than just buying media. The original purpose of DSPs was to access exchange-based media placements.  They were a tool to buy advertising media closer to at-cost, which provides additional controls over bids, budgets, frequency, and other optimization levers.Today DSPs are seen more as a conduit to audience-based targeting.  Advertisers use them to retarget audiences with first-party site and CRM data and also target new prospects with a slew of third-party data from the likes of BlueKai, Exelate, Datalogix, and Neustar.  Doing this, direct-response advertisers have found more efficiency, and branding advertisers feel more confident that they are targeting their messaging more precisely.This shift to a tool focused on audience targeting rather than operational efficiency has led to the birth of audience-powered DSPs. These DSPs are built on top of a publisher or vendor’s proprietary first-party audience data as the primary mechanism for serving ads.

Facebook is the most recent example.  In early October, Facebook announced that it would be creating a DSP that would use “people-based” targeting” — such as users’ volunteered profile data, including gender, age, and interests — for targeting throughout the exchanges.  This was originally only available on Facebook’s own properties or for Atlas users.

But Facebook was not the first to push into this field.  As with most things in digital, Google’s DSP, DoubleClick Bid Manager, was one of the first to offer Google first-party data gathered from its display network for targeting.  Using this DSP, advertisers can target affinity and in-market segments proprietary to Google.

There are a few other audience-powered DSPs that are not on many advertisers’ radar, yet have strong first-party audience data.  Amazon quietly launched a DSP that leverages its coveted shopper data.  The most obvious use cases are for CPG brands and other product-based advertisers who can focus on users of competing or complementary products.  But strong connections can also be made with different types of audiences like small businesses (purchasers of “how to start a business” books, for example) or movers (purchasers of moving materials like boxes and tape, say).

AOL has been pushing its own DSP under the umbrella AOL One for some time.  While AOL has its own rich first-party data from its owned and operated properties, the most exciting data is coming from its integration with Verizon Wireless.  The Verizon Selects program, comprised of opted-in users, tracks a user’s behavior on its mobile device.  As a Verizon subsidiary, AOL is integrating this Verizon data into its DSP.  This gives AOL’s DSP direct access to arguably one of the most robust mobile audience data sets available — a must-have for any advertiser targeting mobile devices.

There are a few other notable traits that make these audience-powered DSPs extremely attractive.  The first-party data attached to these DSPs so far have been free or cheap.  This is a big draw, given how expensive third-party data can be and the premium advertisers are willing to pay for good audience data.  There’s also an opportunity to create look-alike audience segments via a site pixel, which can take the guesswork out of choosing the right audience segments.  Finally, all of these players have their own sources to cross-device data.  Advertisers can target the same user across multiple devices through a deterministic methodology.

As of now, most of these audience-powered DSPs aren’t fully primed to replace existing DSPs just yet.  For example, the optimizations required within retargeting campaigns require advanced decisioning that many of the mainstream DSPs have spent years developing.  Some are also not fully ready to work with automated guarantees or ingest dealIDs for private marketplace deals.  Despite this, advertisers should be looking for ways to complement their existing programmatic buys with the rich first-party audience data these DSPs offer exclusively.DSPs have evolved and have become much better at targeting people than just buying media. The original purpose of DSPs was to access exchange-based media placements.  They were a tool to buy advertising media closer to at-cost, which provides additional controls over bids, budgets, frequency, and other optimization levers.

Today DSPs are seen more as a conduit to audience-based targeting.  Advertisers use them to retarget audiences with first-party site and CRM data and also target new prospects with a slew of third-party data from the likes of BlueKai, Exelate, Datalogix, and Neustar.  Doing this, direct-response advertisers have found more efficiency, and branding advertisers feel more confident that they are targeting their messaging more precisely.

This shift to a tool focused on audience targeting rather than operational efficiency has led to the birth of audience-powered DSPs. These DSPs are built on top of a publisher or vendor’s proprietary first-party audience data as the primary mechanism for serving ads.

Facebook is the most recent example.  In early October, Facebook announced that it would be creating a DSP that would use “people-based” targeting” — such as users’ volunteered profile data, including gender, age, and interests — for targeting throughout the exchanges.  This was originally only available on Facebook’s own properties or for Atlas users.

But Facebook was not the first to push into this field.  As with most things in digital, Google’s DSP, DoubleClick Bid Manager, was one of the first to offer Google first-party data gathered from its display network for targeting.  Using this DSP, advertisers can target affinity and in-market segments proprietary to Google.

There are a few other audience-powered DSPs that are not on many advertisers’ radar, yet have strong first-party audience data.  Amazon quietly launched a DSP that leverages its coveted shopper data.  The most obvious use cases are for CPG brands and other product-based advertisers who can focus on users of competing or complementary products.  But strong connections can also be made with different types of audiences like small businesses (purchasers of “how to start a business” books, for example) or movers (purchasers of moving materials like boxes and tape, say).

AOL has been pushing its own DSP under the umbrella AOL One for some time.  While AOL has its own rich first-party data from its owned and operated properties, the most exciting data is coming from its integration with Verizon Wireless.  The Verizon Selects program, comprised of opted-in users, tracks a user’s behavior on its mobile device.  As a Verizon subsidiary, AOL is integrating this Verizon data into its DSP.  This gives AOL’s DSP direct access to arguably one of the most robust mobile audience data sets available — a must-have for any advertiser targeting mobile devices.

There are a few other notable traits that make these audience-powered DSPs extremely attractive.  The first-party data attached to these DSPs so far have been free or cheap.  This is a big draw, given how expensive third-party data can be and the premium advertisers are willing to pay for good audience data.  There’s also an opportunity to create look-alike audience segments via a site pixel, which can take the guesswork out of choosing the right audience segments.  Finally, all of these players have their own sources to cross-device data.  Advertisers can target the same user across multiple devices through a deterministic methodology.

As of now, most of these audience-powered DSPs aren’t fully primed to replace existing DSPs just yet.  For example, the optimizations required within retargeting campaigns require advanced decisioning that many of the mainstream DSPs have spent years developing.  Some are also not fully ready to work with automated guarantees or ingest dealIDs for private marketplace deals.  Despite this, advertisers should be looking for ways to complement their existing programmatic buys with the rich first-party audience data these DSPs offer exclusively.

Read more:

http://www.mediapost.com/publications/article/263248/the-rise-of-audience-powered-dsps.html

 

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