CTV Supply Path Optimization (SPO)
What is Supply Path Optimization (SPO) and why should you care?
The details on SPO can get complex but the general concept is simple.
SPO represents the steps you take as an advertiser to understand where each impression you purchase originates and how many intermediaries (hops) exist between the original seller of that impression and you the buyer.
For programmatic media, the goal is a very short chain. Ideally seller(publisher) → SSP → DSP.
In the context of CTV, a solid SPO strategy will ensure that you are purchasing the best inventory at the best price and significantly if not completely eliminating your exposure to fraud.
However, achieving this can be very challenging. As we outlined in How To Advertise On CTV there are several paths to purchase impressions from most CTV publishers.
A Strategy for CTV Supply Path Optimization
Let’s break down the four most important components of quality SPO. This is essentially equal parts strategy and execution. You need both to make it work.
This can be significantly more complex, but if you get these correct, you will be ahead of 95% of the programmatic CTV buyers.
Buy from the source and limit your use of aggregators.
Implement policies and processes for execution and ad ops.
Actively optimize delivery, ensuring you don’t over-deliver with just a few publishers.
Troubleshoot, troubleshoot, and troubleshoot some more.
Buy From the Source
What makes CTV nice, as it relates to SPO, is its not terribly long tail. Viewership is concentrated to a short list of apps.
Nielsen: Time Spent Watching CTV, P2+, September 2024
So, if you have the relationships, your best bet is to reach out to those publishers and set up PMPs with them directly on your DSP of choice.
As you finalize the specifics, a key detail to note will be what inventory is included in each deal. Most publishers will offer or issue multiple deal types with slightly different variations in their overall inventory mix.
Make sure you understand what is included so you can verify later via your placement reporting.
You will also need to note which publishers require that you bid on blind inventory within their portfolio. This applies primarily to Paramount and NBCU. Paramount, for example, typically issues PMPs that bundle Paramount+ and Pluto inventory together. With these deals, they don’t pass back publisher or site/app details. Everything comes through as “Paramount (undisclosed).”
Once you have your primary deals set with Disney, NBCU, Netflix, Paramount, WBD, Tubi etc. you can turn your attention to aggregators.
A common starting point here is Supply Side Platforms (SSPs). Freewheel and/or Magnite are both good options to start with.
SSPs have demand teams that will work with you to buy across all of the inventory they have access to, or you can “curate” a custom deal that works for your agency, brand, or campaign.
The challenge with SSPs is they require very active management and oversight. While you may have agreed on a specific set of publishers, over time you will inevitably notice that delivery ends up outside of that list.
Ad Ops & Execution
Now you have all your deals in place and you know what you want to include in your campaigns. The next step is putting the policies and process in place to make sure that’s where the money ends up.
This is going to look different for every organization and each DSP has slightly different controls and tools to help with this. However, how you choose to execute has a direct impact on your options to optimize delivery later. So choose wisely.
At Dial-Up we use The Trade Desk and our policy is to exclusively use 1st party PMPs on all campaigns. Our process is to simply organize those PMPs into what Trade Desk calls contract groups. Both generic contract groups and then campaign or brand specific contract groups if necessary.
Additionally, we create publisher inclusion lists for each campaign. This allows us to control what inventory, within each deal, that we bid on for a specific campaign. Publisher lists are also the primary tool we use to optimize and shape delivery.
Delivery Optimization
DSPs will very reliably optimize for scalable, low-cost inventory sources. For some campaigns, this may be a good thing. For many this results in a less than desirable inventory mix.
Comparison in campaign delivery for a campaign that implemented a SPO strategy vs. a standard programmatic CTV campaign.
This outcome can be compounded by how many aggregators or SSPs you have included in your initial mix.
And most DSPs still lack sufficient controls to set inventory spend goals at the campaign level.
So you are left with manually tracking delivery and optimizing with the tools available in your DSP. Another process to define for your organization.
We manage this by tracking delivery at the publisher level and in The Trade Desk using bid modifiers to shape delivery throughout a campaign.
It’s painful and time-consuming. But it gets the job done and the results speak for themselves.
Troubleshoot, Troubleshoot, Troubleshoot
The last piece of the puzzle is to acknowledge that none of this is perfect. Frankly, it’s pretty fragile. Deals will break, creative randomly won’t get approved, you may hit an expiration date that you didn’t note on one of your deals etc.
So the final process you need to dial in is oversight and triage at the organization level. Who is responsible for checking the health of all your deals, getting creative approved, and working with your publisher and inventory partners when things break?
SPO is not for the faint of heart. The details can get complex, and there is a very tangible investment in time and resources on the front end.
But the reward is worth it. The quality of your overall inventory mix will substantially increase, costs will come down vs. the open exchange and campaign performance will improve. Because you have eliminated low-quality inventory that is prone to high rates of non-human traffic or other sources of fraud.
At Dial-Up Media we take SPO and delivery optimization seriously because we see the positive impact on performance every day.
Contact Us to learn more. We do CTV The Right Way.
