Last year many brands were in the testing or consideration phase for in-housing media, he said, and now those numbers are starting to shake out.
Brands actively exploring in-housing technology dropped by 23% since the start of last year, with an additional 7% recommitting to outsourced technology and 16% transitioning to an in-house data and technology model.
The brand approach to in-housing is split roughly in three: those working directly with DSPs, with an agency and DSP or using an enterprise software solution.
Unlike agencies, which are being squeezed by consultancies and by in-housing adoption, DSPs are more often maintained as silent partners in the supply chain, Mannion said.
Keeping those brand relationships intact is crucial for the half dozen or so contender DSPs.
The Brand Pillars
Amazon and Google are particularly strong with brand-direct relationships.
Many brand marketers, even those with large media agency contracts, separately oversee most of the spend for self-attributing platforms like Google, Facebook and Amazon, Mannion said.
The average number of DSPs used by a marketer is steady at 3.3, but that often leaves only one or two seats at the table for independent solutions.
The industry has waited on mergers and acquisitions – or outright business failure – to thin out challenger DSPs, Mannion said, but those forecasts have been mostly unfulfilled.
Sizmek acquired Rocket Fuel last summer and Adobe bought TubeMogul in late 2016, but if anything those deals solidified the position of the two parent companies in a tightly packed group of DSP that includes The Trade Desk, MediaMath and AppNexus.
Programmatic budgets have consolidated to the top two players, he said, “but so far that consolidation and other selection trends haven’t winnowed out the next set of DSPs, where there’s a pretty open market.”