03.18.16 | By Liane Nadeau —
This week, TubeMogul took a big dig at Google’s ad offering. Their campaign, “A Manifesto for Independence,” includes a micro-site, out of home ads, and a custom video — all aimed at proving that Google’s DSP is bad for advertisers. This is a very self-serving stance for a video-first DSP who is undoubtedly losing market share to the tech giant, and who is clearly still feeling scorned by Google having taken away their access to YouTube inventory. However, the campaign does bring up some very valid questions on the pros and cons of walled gardens.
Background
Advertisers are increasingly looking for cross-platform measurement, holistic campaign optimization, and one view of their audience. This has led to a period of partner consolidation in the digital space. Instead of leveraging multiple partners for their unique data and inventory, advertisers are looking to run as much through one single platform as possible. Ad tech vendors are racing to become that “one-stop shop.”
Through growth and acquisitions, big players like Google, Facebook, and AOL are able to offer a “full stack,” with everything from ad servers, buy side platforms, sell side platforms, media exchanges, and data/measurement.
By definition, a “walled garden” is a closed ecosystem where the carrier or provider has control over all applications and content. In the ad world, it is a platform that limits integration with outside providers (inventory sources, data providers, measurement tracking, etc.).
The Truth about Walled Gardens
TubeMogul’s campaign raises many cautions for advertisers, some of which are valid, and others that aren’t.
Advertisers don’t get access to all data and inventory: FALSE
Walled gardens are not about keeping other inventory and data out, but instead about keeping their own in. It is in Facebook and Google’s best interest to only offer their proprietary inventory/data inside their walls, in order to maintain a competitive advantage. However, they have no reason not to offer the most outside inventory and data possible.
Google’s DSP has access to almost all open exchange inventory (second only to Turn), and allows guaranteed buys and private marketplaces to run through their pipes. On the data side, they partner with all the major DMPs to allow advertisers to bring on their own first party data.
Conflict of Interest: TRUE
TubeMogul also argues that by participating in both the buy and sell sides of the equation, Google creates an inherent conflict of interest. The fear is that they can potentially skew advertisers to buy more of their own inventory, where they receive a double markup. Google, AOL, and others attempt to combat this by having separate teams work on the buy and sell side of their business, and being transparent about the markups they take on the DSP and SSP.
While this is helpful, it doesn’t account for the possibility that their DSP is coded to optimize towards inventory where they will make more money. There is no way to prove this without having an open, customizable algorithm, which Google doesn’t. The only way to truly eliminate any bias is to disable Doubleclick Ad Exchange inventory in the buy, which isn’t ideal given it comprises almost a quarter of all open exchange inventory.
Measurement and Campaign Data Access Restricted: SOMEWHAT TRUE
Doubleclick Bid Manager does indeed allow for third party pixels and DMP tags to run across their platform. However, there are significant limitations. 3rd party data collection, viewability, and measurement tags cannot run on any of Google’s O&O inventory (including Google Display Network). Additionally, Google-proprietary data can only run on their own exchange inventory. While they claim it is a data privacy policy, this protects their competitive advantage by keeping their data within their walls. However, it is worth noting that this isn’t just a restriction in DBM, but across Google inventory bought through any DSP.
What does this mean for advertisers?
Walled gardens are a reality in the ad tech world today. As inventory access and third party data is turned into a commodity, vendors need to do whatever they can to maintain a competitive edge. While this may be a bad thing for the industry overall, it isn’t necessarily bad for individual advertisers.
DigitasLBi is constantly evaluating the DSP landscape, partnering with the best platform based on our clients’ individual data and inventory needs. Google’s DSP is a solid option for many advertisers, especially if they are using other products on the stack. DBM may be a “walled garden,” but if everything you need is inside, there is no reason not to jump in.
Liane Nadeau is Programmatic Lead, DigitasLBi Boston