Marketers regularly complain about visibility in digital advertising and, immediately, Viant’ s Adelphic announced the pricing change that it believes resolves the problem for a demand-side platform ( DSP ).
What’ s i9000 new. Instead of getting a percentage of media spend because other DSPs do — generally 10 to 15 percent — Adelphic will charge an all-you-can-eat monthly membership price of $3, 000 per log-in, with a 12-month minimum. And all suppliers involved in the process — targeting information providers like data management systems, inventory providers like ad trades, verification services and others — are usually billed directly to the advertiser.
For those of us who don’ t use DSPs on a daily basis, it appears surprising that a subscription model plus direct billing is new, yet Viant CEO Tim Vanderhook mentioned in an interview that he is unacquainted with any other DSP that has a similar construction.
SaaS compared to media agency pricing model. Adelphic, which Viant bought two years ago, also previously billed a percentage of media spend plus paid vendors itself as part of the fee. Vanderhook said his organization spent the time since the purchase obtaining overall operating costs of Adelphic down to a point where it could provide a subscription.
After all, he or she said, it doesn’ t cost you a DSP more to handle a thousand bucks in advertising than to handle 10 million dollars’ worth. The particular trade-off for advertisers, he recognized, is that Adelphic requires a 12-month dedication, whereas other DSPs only cost advertisers for their spend.
Typically, he said, DSPs use a pricing model derived from media-buying companies, which charge a percentage of press spend as their fee. Many DSPs, he added, don’ t possess a fixed percentage, but set that will fee based on how much business a good advertiser does. Instead of using a design based on media-buying agencies, Adelphic is currently offering the subscription model of software-as-a-service.
In the traditional prices model, the advertiser will often pay out the DSP an additional monthly quantity based on, say, overall CPMs, with all the fees for targeting data, supply, verification services and other vendors hidden in the overall charge. Vanderhook additional that this monthly amount, separate from your DSP fee, is almost as if the particular DSP is a publisher itself, getting for its impressions.
The 800-pound gorilla. That leads to advertisers’ suspicions as to what the vendors’ charges actually are, he or she said, and whether there are kickbacks between DSPs and vendors.
“ The 800-pound [gorilla] here, ” he or she said, “ is that no one trusts each other, and there has to be a model therefore everyone trusts everyone. ”
Ari Paparo, CEO associated with ad tech firm Beeswax, informed me via email that it is “ naï ve and a bit of a gimmick to provide an one-size-fits-all pricing structure on an item as complex and bespoke being an enterprise DSP. ”
But , he added, this shift “ is a strong indication which the market is demanding more clear and fairer pricing models which are commensurate with technology usage, instead of arbitrary pricing models that punish for more media spend and press spend on more expensive inventory. ”
Why this issues to marketers. Openness in ad pricing is main to making the entire industry more reliable for brands, and a software-as-a-service membership model for DSPs, with immediate payment by brands to suppliers, would seem to directly address that will part of the equation.
This story first appeared on MarTech Today. For more on marketing technologies, click here.
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