The evolution of the great ‘curation’ tussle in ad tech
The word “curation” in the context of ad tech refers to the process of selecting and organizing premium, high-quality inventory for advertisers and brands to more effectively target specific audiences.
During the ongoing fall conference season, it’s one of the industry buzz phrases for 2024, placing it alongside buzzwords such as “addressability” and “antitrust,” or even the oft-inappropriately-used “AI.”
Curation is particularly relevant in programmatic advertising, where the volume of available ad inventory can be overwhelming — and inventory quality can vary significantly.
Some deem the proposition of “curation” from sell-side platforms as a response to “supply path optimization” from both buyers and demand-side platforms, a process that has been in play (arguably) since the late 2010s by the likes of AppNexus, a.k.a. Xandr, and most prominently by The Trade Desk since the early 2020s.
Scholars in the sector debate who coined the phrase, but what’s clear is that this movement was geared towards efficiencies, i.e., edging out undifferentiated resellers in a notoriously opaque sector of the digital advertising ecosystem.
Fee duplication, latency, and all manner of hidden costs were in the crosshairs of such SPO efforts, and as header bidding gained popularity, it introduced new complexities into the programmatic supply chain. Thus, SPO strategies became more critical as advertisers looked to manage and optimize the different paths through which inventory could be accessed via header bidding. Sometimes, they favor direct relationships with DSPs instead of their traditional media agency partners.
For some, this started to place too much control in the hands of DSPs, especially as brands’ media teams had to consider privacy restrictions such as CCPA and GDPR. Subsequently, a notable contraction in the number of SSPs could be observed as the early 2020s evolved into the latter part of the decade.
Meanwhile, sell-side players brought their own flavor of efficiency efforts with what became known as “demand path optimization” among some from the early 2020s.
Notable efforts by SSPs to cozy up to media buyers included ClearLine by Magnite and Activate by PubMatic. Both developments meant that buyers could log in directly to the SSP and book their ad campaigns, a contrast to the more orthodox method of programmatic media buying via DSPs.
Industry consultant Ari Paparo noted how curation is a more palpable trend than other contemporary buzz phrases, such as ‘clean rooms,’ observing that its need and impact are more immediately tangible. “It’s actually solving a significant problem right now,” he said, noting that “it’s also kind of a weapon in the war between DSPs and SSPs … it’s their defense against SPO.”
As 2023 morphed into 2024, advertisers’ concerns over inventory quality were freshly stoked by revelations over the prevalence of made-for-advertising websites on their media plans in the inaugural ANA study, granting succor to companies providing such curation services.
Per Paparo, this has opened the door for two types of roles from supply-side players: platforms and data sources.
In his recent Marketecture newsletter, Paparo also compared such curation efforts from sell-side players to earlier ad networks of yesteryear. However, he did note that the latest iteration of “curation” services tends to lack the two most common historical criticisms of ad networks — profits and transparency.
Although, pointedly, he asked, “Can’t you do all of this in your DSP?”
The value-gap
However, Robert Webster, founder of AI marketing consultancy TAU Marketing Solutions, points to some of the hazards (in his opinion) of trusting DSPs.
Per his assessment, many have historically refused to claim responsibility for inventory quality, thus creating a significant gap in the programmatic ecosystem. “This vacuum is exactly where curation adds value,” he added. “Curation companies put their reputation on the line by standing behind the quality of the curated inventory they offer.”
Meanwhile, fellow industry commentator David Nyurenberg, who also serves as director of video product development at independent media agency Rain the Growth Agency, noted how those eager to take advantage of the latest iteration of the curation saga should pose some questions.
“While the large SSPs may be trying to rebrand their practices, there are companies that were specifically built for curation,” he opined in a LinkedIn post. “These companies are often more focused on delivering true value by curating inventory with purpose, rather than just packaging the same inventory under a new label.”
Per his assessment, it’s essential to assess whether such companies are “built with curation as a core competency, not as a reaction to market pressures?”
Andrew Casale, CEO of Index Exchange — an SSP that recently partnered with Chalice to use its AI to form dynamic PMPs, meaning buyers can better scale their campaigns on the fly — said, “SSPs have historically been demand drivers for publishers, not strategic partners.”
However, the latest iteration of the debate is upending this arrangement, per Casale. He told attendees during his keynote appearance at the recent Prebid Summit that the new kinds of curation partnerships they’re striking with buyers are indicative of maturity in the space.
Casale terms the more recent iteration of ‘the curation debate’ as “sell-side value creation” and points to the company’s Chalice partnership as a further evolution, as this is one where Index Exchange provides a platform, and the AI startup further monetizes
More collateral damage for publishers?
However, while curation seems like the latest battleground for DSPs and SSPs to fight each other, publishers look set to become collateral damage (again), according to the digital lead at one publisher, who exchanged anonymity for candor when speaking with Digiday.
Grim as this sounds, their point is rooted in fact: in the past, publishers have let ad tech vendors curate their ad inventory in the hope of getting better rates and access to more buyers. But in doing so, they’ve ceded control of that process and subsequently had to watch from the sidelines as other companies profited from their audiences.
It makes sense that this particular publishing exec is steering clear of curation efforts. Instead, they’re going to focus on media alliances. “Better publishers work together to curate their ad inventory,” said the exec, “rather than others.”
Lack of inventory
Meanwhile, Lulu Phongmany, an industry consultant who works with brands and publishers, told Digiday the question of who controls inventory curation is merely a tactical quandary when it comes to monetizing their content, especially as traditional search-based traffic sources begin to wane.
In the view of Phongmany — who has worked with publishers such as Dotdash Meredith and Digital Trends Media Group — the emergence of content discovery tools such as ChatGPT, etc., will pose publishers with more strategic questions to answer.
“User experience and behavior have shifted,” she said. “The fact is that most publishers get their inventory via page views or unique visitors, with 70% to 80% via search traffic, and over the last 10 years, it’s gone from desktop to mobile, which is fine [to monetize].”
She went on to add, “But what ChatGPT [and other AI tools for content discovery] has done is fundamentally change user behavior, and this affects publishers and advertisers alike, as there is now a lack of inventory, it requires a lot of rethinking when it comes to ad products.”
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