The success of Digital Out-of-Home (DOOH) networks is closely tied to their partnerships with Supply-Side Platforms (SSPs). These partnerships play a critical role in ensuring that DOOH networks maintain clarity and control over their inventory, avoiding confusion and dilution that often arise when working with omnichannel SSPs.
The Fragmentation of Supply
One of the key challenges in the DOOH ecosystem is the fragmentation of supply. As Chris Kane from Jounce Media explains, the DOOH supply landscape is highly fragmented, making it difficult for buyers to fully understand the inventory they are purchasing. Unlike more established digital platforms like Instagram, where ad products are easy to understand, DOOH lacks such clarity. The differences between inventory types, their value propositions, and the nuances involved in purchasing DOOH inventory are often lost within the complexities of Real-Time Bidding (RTB) auctions.
Ambiguity in Inventory Classification
A significant issue facing the DOOH space is how inventory is classified. DOOH is not easily categorized as either traditional OOH or CTV, creating ambiguity for both buyers and sellers.
As marketers increase their spending on DOOH, they are encountering a growing pool of inventory that doesn’t fit neatly into either category. This ambiguity can lead to confusion in the bidding process, where advertisers struggle to determine which budgets should be applied to these types of auctions. The lack of clear inventory classification can result in resource misallocation and ineffective campaigns, undermining trust in the DOOH sector.
The Role of DSPs and SSPs
Demand-Side Platforms (DSPs) and Supply-Side Platforms (SSPs) also contribute to the complexity of the DOOH marketplace. Different DSPs categorize and treat bid requests from connected screens in various ways, which adds to the confusion. For instance, a DSP might categorize a bid request from one SSP as CTV while classifying a similar request from another SSP as DOOH. These inconsistencies complicate the process for buyers who are trying to make informed decisions about where to allocate their media spend.
The Impact of Auction Duplication
Kane also points out the growing practice of auction duplication, where screen owners generate multiple bid requests for the same inventory. While auction duplication is common in other digital environments like web and mobile, it is not yet standard practice in DOOH. However, a small number of DOOH companies that use auction duplication can dominate the bid stream. This leads to an "availability bias," where buyers are more likely to spend their budgets on inventory that appears more frequently, regardless of its actual value.
Did you know?
92% of OpenRTB demand for DOOH is captured by just 10 publishers, largely due to the practice of auction duplication.
Conclusion
The success of DOOH networks hinges on overcoming the challenges presented by inventory fragmentation, classification ambiguity, and auction duplication. For advertisers, navigating this complex landscape can make it difficult to assess the true value of DOOH inventory and allocate budgets effectively. Addressing these issues will be essential for maximizing the potential of DOOH advertising and ensuring that marketers can achieve their desired outcomes.
For more information on Supply Path Optimization and how to navigate the complexities of DOOH, check out the free resources at Jounce Media.
