After reading Eric Picard’s articles on “How arbitrage works in advertising today” and “Why no one can define "premium" inventory,” I want to briefly discuss how to generate revenue from your premium unsold inventory without eroding your standard for premium in the ad eco-system.
As a publisher, can you consider your ad inventory premium? This is based on the type of audience you attract and their perceived value to your clients. High prestige audience marketing is giving way to the larger pool of affluent consumers who have a bigger market voice and exert more influence on tastes and styles in Canada. Catering to boutique consumers is giving way to this affluent mall shopper. Household income, age, and gender are traditional factors that still define a high-value consumer and make your inventory premium -- even if you are a small publishing team. To be considered a publisher with premium ad inventory, regardless of your size, you have to verify the quality of your visitors through a third-party rating agency like ComScore or Neilson Net Ratings. Returning advertising clients will begin to define the more in-demand sections of your website. This will begin to differentiate the pricing you offer and the packages you create. And as you start earning revenue from your unsold premium inventory, you will start roping off sections of your website, like your homepage or above-the-fold spaces, where you exclude less important “remnant” ad campaigns.
There are several third-party networks that will accept your unsold inventory at a wholesale rate and auction it to ad campaigns at the highest price they can get above the wholesale rate. You can run several ad campaigns from several of these networks and have them compete against each other, but not with the campaigns sold by your sales force. Let's say you are running Google Ad Words along with just one other ad network. You want the campaigns from Google Ad Words and this network to compete with each other, but they will have a lower priority than your second-party campaigns.
To set this up in DFP, enable Google Ad Words for the ad spaces you create. Set up the third-party ad tags as creatives under their own advertiser account. There is a price setting called Value CPM. Use this to establish the average acceptable remnant CPM across your website. The Value CPM compares the CPM of the campaigns from the networks to the CPM of campaigns from Google Ad Words. DFP will select the higher paying CPM closest to your accepted average rate. If you opt to set the CPM of network campaigns to a fixed CPM, as you do with second-party campaigns, you will run into instances where there are no campaigns meeting this criteria -- in which case you end up serving more of your non-paying house ads than intended.
The role of pass-back tags depends upon you receiving the pass-back tags from the network to traffic or if you send your own for them to traffic. In the former scenerio, you will traffic their pass-back tags as the creatives under the network’s advertiser account. When the pass-back tag is called up as a creative on your website, it looks at the campaigns available from the network and if there are none that meets your Value CPM setting it “passes back” to your ad server to deliver a house ad. In the latter scenerio, where you send your own DFP pass-back tags to the network, they will traffic it as the lowest-priority ad in their available campaigns for your website. And if they do not have any campaigns suitable for your website, they “pass the ad request” back to your ad server to deliver a house ad.
The reason pass-back tags do not deliver any second-party ads is because they are set at a lower priority level, usually at the “House”, “Network”, or “Bulk” level. To add more third-party networks, create an advertiser account for each network. In practice, however, this will yield marginally more new campaigns as Google Ad Words, and its display campaigns, with your one other third-party network can fill up all unsold inventory each month. In choosing a third-party network, go about considering the account management you will get and the type of campaigns they have available. Networks with top tier consumer brands will ask for more conditions from you.