Supply path optimization should be data-driven — not dictated by commercial terms

Marketers and media buyers have long understood the importance of supply path optimization (SPO) in getting the most out of advertising budgets. But that doesn’t mean it’s always being done as effectively as it could be.

While for some, SPO is synonymous with rebates, it should focus on media quality, brand safety, operational efficiency and transparency in the supply chain to maximize value. If your brand or agency wants to stay out of buzzy brand safety reports, working with partners with incredibly high media standards should be a priority.

If someone is telling you they have all the scale in the world and best-in-class media standards, you should start asking questions like, “How are they getting so much scale?” and “Are they duplicating requests?” (Don’t worry, request duplication is a topic for another article.)

While signing a series of commercial agreements and getting bottom-of-the-barrel inventory isn’t ultimately in the best interest of the brand or agency, media buyers can take control of their SPO strategy by asking these questions and making simple, data-driven decisions.

How we got here

To fully understand the current landscape, we need to rewind a couple of decades. When programmatic first emerged in the mid-2000s, it offered a solution to the inefficiencies of digital advertising, making it easier for advertisers to find relevant audiences for their ad campaigns at scale while publishers were able to monetize their remnant inventory and put an end to the faxing of IOs. This prompted new tech companies to enter the picture, seeking to add value to the programmatic ecosystem (and taking a slice of media budgets too).

With the arrival of header bidding in the mid-2010s, publishers could access a greater number of advertiser bids, increasing fill-rates. But marketers suffered from a lack of visibility into who their partners were, which publishers were hosting their ads and where their budgets were being allocated. Though beneficial for the entire ecosystem in terms of scale, these additional layers of complexity have required careful navigation since.

That’s why SPO has become a key focus for advertisers, agencies and publishers. Cleaning up supply paths leads to greater efficiency and transparency. But if my time working in this industry has taught me one thing, it’s that not everyone approaches SPO in the same way.

Don’t let rebates cloud your judgment

While SPO should be about finding the most direct path to delivering the right ad to the right consumer at the right time and price, it doesn’t always work that way. With dozens of supply-side platforms (SSPs) operating globally, buyers aren’t short on choices, but it’s time for a closer look at how those choices are made.

In my experience, too many buyers are prioritizing commercials without asking enough questions about the quality of supply. The best thing you can do for your brand or the brands you represent is take a much closer look at media quality.

Partners who are offering vast scale may very well have achieved this by tapping into the supply of resellers or other SSPs, which adds an unnecessary link to the chain (and tends to include made-for-advertising (MFA) or other non-premium content). By structuring SPO agreements around rebates, buyers are doing the opposite of what SPO is meant to achieve, and instead driving more spend toward areas where SSPs can take higher fees instead of optimizing for quality and efficiency.

Buyers should instead examine the data to see which partners provide access to high-quality content, robust brand safety measures, operational efficiency and transparency in the supply chain to maximize value.

Transparency is key to effective SPO

Rather than thinking in terms of absolutes around commercial terms, agencies should be looking for SSPs that give them access to quality inventory and audiences they want in the most direct way possible.

To ensure they’re getting the best deal, buyers must demand complete transparency from their SSP of choice. There must be log-level visibility into every placement, so they can see precisely where their ads appear. Additionally, ads.txt, app-ads.txt and sellers.json should be enforced to ensure authorized inventory. In short, every hop in the supply chain must be accounted for and evaluated.

Ask more questions

Media buyers have a choice, and it starts with asking more questions about media quality than rebate size. Asking partners if they’ve ever run somewhere undesirable — and if so, what they’ve done to mitigate those instances moving forward — should be table stakes.

Buyers have a right to make informed SPO decisions that drive better outcomes, reduce the risk of wasting budget on duplicated inventory and MFA websites and maximize value. By prioritizing transparency and quality over short-term incentives, they can take steps to build a smarter, more efficient supply path that truly delivers on performance and ROI.

This op-ed represents the views and opinions of the author and not of The Current, a division of The Trade Desk, or The Trade Desk. The appearance of the op-ed on The Current does not constitute an endorsement by The Current or The Trade Desk.