Yesterday, a team of analysts from Forrester Research led by Joanna O'Connell, published a new report, "The Forrester Wave: Demand-Side Platforms, Q4 2011," shining a light on the programmatic buying trend in display advertising, and looking at seven demand-side platforms and their capabilities, in particular. O'Connell begins her team's analysis by stating the challenge for those holding the ad spend: "Today's digital media buyers - whether working in an agency environment or inside a company’s marketing department - face an unprecedented level of complexity in developing, managing, optimizing, and reporting on their media programs." You can currently get a free download of the report on MediaMath's site here.
O'Connell discussed the report with AdExchanger.com.
AdExchanger.com: Can you discuss your methodology a bit for creating this report? Did you talk to clients of the DSPs or do buys yourself, for example?
JO: It’s quite a formal process. We start by screening a very broad set of companies/entities who we think might meet the criteria we consider most important in a DSP (in this case, it was around 3 dozen). All those vendors get a lengthy and detailed survey to fill out. Using that information, we then narrow it down to a handful of companies who we find formally meet our criteria for inclusion in a DSP Wave. In the case of this Wave, we were looking for things like focus on RTB, % of impressions that were display, presence of self serve capabilities, etc (the full list of screening criteria are outlined in the Wave report). At that point, we have our list of Wave participants. Then it becomes a very long process of information gathering, which happens in a number of ways – we send a formal set of questions which all the vendors respond to (these ultimately turn into our scoring criteria), we do briefings and demos with all of them, we do very formal interviews with clients (and in my case, I also sent a follow up survey to gather some quant feedback too). There’s also an extensive fact checking process, where we go back and forth with our Wave vendors to ensure we’ve been factually accurate in our evaluations, etc. One important note here: Google declined to fully participate in the Wave so our process with them was a bit different. We had to treat them as a “non participating vendor” (which you’ll see noted throughout the doc). Rather than using the info gathering methods described above, we had to rely on our own knowledge of their product, as well as gathering some qualitative feedback from DSP customers, and using publicly available information to make our assessment.
It was really interesting digging into the DMP question with the DSP vendors in this Wave. Many of them are building – or have built – capabilities that overlap with core DMP capabilities – things like the presence of a universal container tag, the ability to ingest both 1st and 3rd party data, scoring and segmentation capabilities and so on. I personally see a lot of value in having a very tight connection between your audience/data management system and your buying platform (though I am still exploring the question of theory versus reality here) so I was very keen on including some basic details on DMP capabilities in this Wave. It’s such a nascent and rapidly evolving market – I am really curious to see how things develop on the DSP/DMP/advanced attribution front.
What are some of the hurdles that marketers will need to overcome to use a DSP in their digital strategy?
The biggest one remains a lack of awareness and/or understanding. There are lots of marketers out there who simply have no idea what a DSP is, or even that such a thing exists. They’re likely relying on their agency to make strategic buying decisions, and might not fully understand the implications of some of those buyers’ choices and recommendations. I am not trying to bash marketers here – don’t get me wrong – what I am saying is there is SO much opportunity to improve media buying practices/processes/efficiency/transparency, and there is a real onus on marketers to get involved in educating themselves and asking questions about what’s being done with their media dollars. That’s why I wrote The Future of Digital Media Buying – I really wanted to highlight the changes going on in digital media buying and management, raise the profile of the opportunity for marketers, and encourage them to ask questions and learn.
It seems that all of the companies are either "strong performers" or "leaders" according to your study. Does this mean you can't lose, so speak, when you pick a DSP?
Haha, well think of it this way – we ONLY looked at a small handful of companies who we found met all our criteria, and as it turns out, all are great in one way or another. There are tons of other companies out there who touch the DSP space in some way. Some are completely interesting, legitimate DSP players, who for one reason or another weren’t included this time around (size, for example – several were still quite small in August when we ran the assessment, either in terms of employee base, or volume running through their platforms). That’s not to say that all the companies we assessed in this Wave are perfect, or even more important, perfect for every client. AppNexus for example is a really interesting company doing really amazing stuff from an RTB standpoint – but at the time we assessed them for this Wave, they were definitely not oriented toward offering a simple, turnkey, marketer friendly DSP solution. An eBay, who’s very sophisticated, has tons of resources, APIs into AppNexus, etc. can do really well with an AppNexus. Average Joe marketer on the street? No sir. They’re much better served going to a MediaMath, Turn or DataXu. That’s why Forrester allows – encourages, really! – marketers to download the Excel model and fiddle with the weightings to create their own custom output based on the things that matter to them.
If you're a publisher, what would you take out of this report? What should they be doing?
Between Michael Greene and I, we couldn’t be beating the drum louder when it comes to telling publishers to get involved in the programmatic/audience opportunity. In fact, Michael’s SSP Wave is coming out soon!
By John Ebbert