Does the number of ad partners in your demand stack impact performance? What are the pros and cons of a longer or shorter stack?
If you’ve ever asked yourself these questions, this post will outline some of the major points to consider when determining what size demand stack is right for you and your site.
This will be a two part series. In part 1, I will discuss:
One of the dirtiest words you can say regarding ad optimizations as far as StudyBreak Media is concerned; as an industry we have come to accept a certain amount of discrepancy. Much of discrepancy is technology related and therefore out of our control – hence the acceptance. However, there are some factors that are within a publisher’s control that impact discrepancy.
The length of your demand stack is one of these factors.
Consider this. Every time a new ad partner has an opportunity to view your inventory for a chance to compete, that ad partner’s tags must be called. When an ad tag (or ad code) is pinged by your ad server or by the preceding ad partner (depending on your setup) two different technologies must communicate with each other. During this process, impressions may be lost between technologies.
The more times this has to happen in one page load, the more opportunity for discrepancy to rear its ugly head. The greater the discrepancy within your demand stack, the more undervalued your inventory becomes. This is because, when an impression is lost you are also losing an opportunity to monetize. This ultimately brings down your overall revenue.
For more information on how discrepancy can impact revenue, check out this great post that discusses it a bit further.
What is ad optimization if not a process of driving up the value of available inventory? So it makes sense that you want to take this into consideration when deciding not only which ad partners to include, but how many.
There are two sides to this —
- A longer demand stack, with strong performing ad partners at the top, can create a lot of auction pressure. This is because the stronger the ad partners at the top of the chain, the less inventory there will be available for those further down. This pressure will cause other ad partners to step up performance or risk losing volume, or even worse being removed from the stack completely.
- Shorter demand stacks don’t necessarily mean less auction pressure, but they do mean that you should be confident in the performance of these ad partners. Since there are fewer opportunities to monetize your inventory, you have to ensure that the select few or perhaps one ad partner you are dedicating your inventory to is able to provide the maximum value.
In a shorter ad chain, measuring performance should be very clear. Don’t be afraid to set realistic expectations for your ad partners. Performance can change throughout the year depending on a variety of factors and you want to make sure you monitor this. If an ad partner isn’t performing well, do you have an alternative?
Regardless of how long your demand stack is, having a strong 100% fill ad partner is crucial. This ensures that you have an opportunity to monetize on inventory that is not purchased by your other ad partners as this partner guarantees they will buy any available impressions they receive (whether that is passed to them from another partner, or served from your ad server).
This type of ad partner gets placed at the end of your stack and will usually pay a lower rate because of their position and type of deal. However, this position is still valuable as it will give you a solid backstop for your ad chain.
When taking on ad optimization, there are many things to consider. Are you also responsible for creating content, managing a staff, or site design? Maybe you are the site owner and you do all of these things and more!
Be honest with yourself and know your bandwidth.
Having a longer demand stack also means a lot more work. Here are a few questions to ask yourself to help you decide what’s most manageable for you:
- You need to pull data reports for each of these ad partners to measure performance – does the amount of ad partners you have dictate how frequently you are willing or able to gather this important information?
- You should be communicating with your ad partners – would you be less likely to be actively communicating if you had more ad partners in your stack?
- You must measure performance – do you feel that having more or less ad partners would help you better understand the value of your inventory?
- You have to set up these ad partners in your ad server and (hopefully) manage tags and price floors within the ad partner UIs – would being responsible for multiple ad partners be something that would cause you stress or increase the likelihood for errors?
These are just some of the things to consider when determining how many ad partners to include in your chain.
In part 2, I will expand on how your specific site user behavior can dictate the amount of partners you work with. I will also discuss how the amount of ad partners in your stack may affect the relationship you have with those partners and the long term success of your ad optimization process.