SPO Checklist: How Buyers Can Streamline Supply Partners to Maximize Return on Ad Spend

Maverick Lee, Senior Director, Buyer Strategy

April 8, 2024 | 5 min read

The omnichannel advertising landscape has forced marketers to stretch ad budgets while still achieving maximum impact. Supply path optimization (SPO) has emerged as a market imperative to compete in this environment. SPO is the strategy of consolidating buying power within fewer supply partners, thus maximizing the benefits these partners can bring and reducing waste.  

SPO isn’t new. SPO started as an effort to consolidate away from large walled gardens (Google, Meta, YouTube, etc) due to questionable practices. These businesses have all caught flak for favoring their own media and grading their own homework (most recently, a $2.8B suit against Google).  This started buyers down the path of asking, “If not in these huge companies, then where?”

Putting your eggs into fewer baskets can be daunting. But GroupM, Canvas WorldWide, Dentsu, and Horizon have all taken the leap to their benefit. 

So let’s explore – why SPO?

  • Reduce your costs: Consolidating buying power allows for the most effective pricing.  (Just watch out for those who offer you 10-20% off; how much are they taking from you today?)
  • Differentiate yourself from your competition: On average, programmatic publishers have 24 SSP partners. But not all access is created equal. Which SSP offers something different from the others? 
  • Supply chain transparency: Are you buying the best possible supply and audiences for your campaign? Do you feel comfortable with what you are buying now, and does your SSP provide the support you need to make the most brand-safe decisions? Do you know how much you’re spending on fees to intermediaries?
  • Remain relevant in the future: A committed relationship with a supply partner with real horsepower will give you a seat at the table when you need something, whether it is tech, custom rates, or preferred access to the most premium inventory.
  • Reduce advertising carbon footprint: Playground xyz conducted a study leveraging Scope3 data that examined 45 million ad impressions. It found that the average digital ad campaign releases 5.4 tons of carbon into the atmosphere, 35% more than the average person emits in a year. Our industry has created an environment that rewards duplicative/bad behavior.  Buyers have an opportunity to resolve this in a meaningful way and drive improved results for their business at the same time.

Below is a three-step approach for buyers looking to forge the most effective path to premium supply and drive higher ROAs.

  1. Consolidate SSPs
  • Determine the criteria for your ideal supply partners. Your criteria could focus on access to exclusive publishers, omnichannel scale, fee transparency, buyer services, or any number of benchmarks — it will vary depending on your business. 
  • Identify three to four key SSPS that meet this criteria, align with your business, and move the needle.
  • Cut ties with low-value, low-quality, or small-scale SSPs that aren’t as good a fit. Do so piecemeal instead of cutting in bulk — by slowly whittling, you can better track how each modification affects campaign results and revenue. As you streamline, monitor KPIs. 
  • Enforce SSP selection with DSP defaults at the campaign or seat level. Finally, update campaign defaults with your preferred SSPs and ensure they’re adopted across your team. 
  1. Allocate Budgets
  • Intentionally spend your budget on performant supply and your most strategic business partners.
  • Track KPIs such as CPM, win and bid rate, viewability, and conversion rate to assess performance. Continue to analyze audience reach and engagement. The right partners will give you more control over your bid strategy, a high level of flexibility, unlock premium inventory at a greater scale, and provide actionable insights across formats that help you optimize spend. 
  • Allocate budgets toward platforms that amplify outcomes by thinking short-term as well as long-term. What are the KPIs you need to hit this quarter? What kind of reach, engagement, and revenue do you want to achieve long-term, and what platforms unlock those “north star” numbers?
  1. Craft Supply Strategy
  • Differentiate yourself as a buyer by getting as close as possible to key sources of supply with access to exclusive/premium supply: Access appears to become more democratized and you can get inventory anywhere, but partners with prioritized access will become a buyer’s strength. This type of access will allow you to pull different triggers to optimize campaign goals.
  • Curate the open market with scaled pools of brand-safe supply using auction packages. 
  • Build out a deal library with specialized deals (such as Programmatic Guaranteed, PMP, etc.) that are specific to your business. A deal library should offer multiple flexible paths to inventory, such as 1×1 prioritized access to premium publishers, curated private marketplace and auction packages, and seller/buyer-defined audiences with reach across thousands of publishers. 
  • Avoid supply path concerns like multi-hop reselling and made-for-advertising (MFA) while prioritizing your media towards premium publisher-controlled supply.

In closing, remember that effective curation also means adopting a habit of consistently monitoring outcomes. Maximizing SPO is an ongoing process – you’ll want to regularly review performance metrics, adjust bids and budgets based on performance, and test new inventory sources and partners.

Hitting “select all” to everyone reduces your buying power, creates unnecessary complexity,  and balloons waste — but you can fight back and be the hero in this story. By choosing the most transparent and direct path to premium publishers at scale, you’ll help not only your own bottom line but also the greater ecosystem.

Download our SPO checklist for more.

Tags: Buyer

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