Presented at Digiday Hot Topic: Media Buying in the Age of Transparency. Presented by Matt McIntyre, Head of Programmatic, EMEA, Essence.

1. MEDIA BUYING IN THE
AGE OF
TRANSPARENCY
22nd NOVEMBER 2018
AUCTION DYNAMICS 101

2. 2
A U C T I O N
T Y P E S
T H E C H A N G I N G
E C O S Y S T E M
T R A N S P A R E N C Y
& T A K I N G C O N T R O L

3. 3
A U C T I O N
T Y P E S
3

4. 4WHOWEARE
‘FAIR’
2ND PRICE
$4.51
$4.50 $5.75

5. 5WHOWEARE
$5.75
‘FAIR’
2ND PRICE 1st PRICE
$4.50 $5.75
$4.51
$4.50 $5.75

6. 6WHOWEARE
$5.75
‘FAIR’
2ND PRICE
‘MODIFIED’
2ND PRICE 1st PRICE
$4.50 $5.75
$5.20
$4.50 $5.75
$4.51
$4.50 $5.75

7. 7WHOWEARE
ALMOST HALF
OF ALL
AUCTIONS IN THE
US ARE NOW 1st
PRICE
19.1%
75.1%
5.8%
23.9%
32.8%
43.3%
DEC
2017
MARCH
2018
FIRST-PRICE AUCTION
SECOND-PRICE AUCTION
WITH ANOMALIES
FAIR SECOND-PRICE AUCTION
Note: Represents activity on the Gentinent platform, broader industry metrics may vary.
Source: Gentinent, April 20 2018

8. 8
T H E
C H A N G I N G
E C O S Y S T E M
8

9. 9
S P O N S O R S H I P S
D I R E C T /
G U A R A N T E E D
P R O G R A M M A T I C
E X C H A N G E S

10. 10
S P O N S O R S H I P S
D I R E C T /
G U A R A N T E E D
P R O G R A M M A T I C
E X C H A N G E S
40% 40% 20%

11. 11
S P O N S O R S H I P S
D I R E C T /
G U A R A N T E E D
P R O G R A M M A T I C
E X C H A N G E S
40% 40% 20%

12. 12
S P O N S O R S H I P S
D I R E C T /
G U A R A N T E E D
H E A D E R
B I D D I N G
P R O G R A M M A T I C
E X C H A N G E S

13. 13
S P O N S O R S H I P S
D I R E C T /
G U A R A N T E E D
H E A D E R
B I D D I N G
P R O G R A M M A T I C
E X C H A N G E S

14. 14WHOWEARE1414

15. 15WHOWEARE
PROGRAMMATIC
AUCTION
IN A TRADITIONAL WATERFALL...
‘FAIR’
2ND PRICE
$4.51
$4.50 $5.75

16. 16WHOWEARE
IN A HEADER BIDDING SETUP...
PROGRAMMATIC
AUCTIONS
‘FAIR’
2ND PRICE
$4.51$4.50 $5.75
1st PRICE
$5.00
$5.00 $3.50
HEADER BIDDING
‘AUCTION’
$5.00

17. 17
T R A N S P A R E N C
Y A N D T A K I N G
C O N T R O L
17

18. 1818
GET ACCESS TO YOUR
DSP LOG FILES
ANALYSE THE DATA AT AN
EXCHANGE AND DOMAIN
LEVEL
PUT PRESSURE ON YOUR
EXCHANGE PARTNERS
EMBRACE YOUR DSP’S
ALGORITHMS

19. 19WHOWEARE
CLEARING
PRICE
BID
PRICE
%
CLEARING

20. 20WHOWEARE
1st Price 2nd Price
100.00%
75.00%
50.00%
25.00%
0.00%
Exchanges
A B C D E F G H I J K
IDENTIFY WHICH
EXCHANGES
ARE MOVING
TOWARDS 1st
PRICE

21. 21
BUILDING
A VIEW OF
CLEARING
TRENDS
ACROSS
EXCHANGES

22. 22WHOWEARE
8% OF AUCTIONS
WERE BOUGHT AT
1ST PRICE
RELATIVELY
EVEN
DISTRIBUTION
OF 2ND PRICE
EXCHANGE G
A
REASONABLE
SPREAD OF
CLEARING %’s

23. 23WHOWEARE
96% OF AUCTIONS
CLEARED AT 90% +
NO 1ST PRICE
AUCTIONS
EXCHANGE A
MOSTLY
‘MODIFIED’ 2ND
PRICE
AUCTIONS

24. 24WHOWEARE
GOOD
BETTER
BEST
DSP Bid Shading
for fixed bid strategies
Goal based algorithm
CPA, ROAS etc
Bespoke algorithm
business objectives such as LTV
MACHINE LEARNING TOOLS IN DSP’S WILL IDENTIFY AND PREDICT THE AUCTION
TYPE SIGNIFICANTLY BETTER THAN YOU
4x -32%
more impressions
bought at 1st price
lower CPM &
Goal cost
eCPM
$0.00 $2.00 $4.00 $6.00 $8.00
Optimised
Bidding
Standard
Bidding

25. 25
W R A P
U P
25
Auction dynamics need to account for
the new challenges that Header Bidding
created
Analyse your own data and put pressure
on Exchange’s if things don't look right
to you
Embrace your DSP’s algorithms to make
sure every bid is right for every auction

26. THANK YOU