Managed vs Self-Service Programmatic Advertising

At the dawn of the programmatic era, some industry minds believed that algorithmic media purchasing posed a big challenge to advertising agencies. If ad placements can be bought and sold on a DSP platform automatically, in real time, and with no human interaction, why would anyone go to the agency? Evolution of digital advertising, however, revealed that agencies still have tremendous expertise to share. Brands without marketers and advertising specialists in-stuff simply don’t have sufficient skills or time to run campaigns on their own.

The same pattern applies to the DSP servicing model. Having the right tool at the right time is a guarantee of success, as long as you know how to use it right. Independent automatic media purchasing can significantly reduce the costs of media buying and streamline the process. Still, it is important to realize whether you need to shift from managed service to self-serve platform or you will be better off when your campaigns are serviced.

Barriers on the way to effective media buying in 2020

According to IAB’s Internet Advertising Q1 2020 Revenue Report, in May we witnessed the slowest YoY growth since 2010 that comes as the implication of damages that COVID-19 caused to global economies.

Advertisers all around the world expect the same situation to continue in Q2 as health organizations predict the pandemics to last at least by the end of this year. In this situation, many advertisers hectically call off their advertising budgets from the verticals that have been affected by pandemics. Advertising budgets continuously shrink, especially in such categories as travel, lifestyle, sports, and outdoor activities.

internet ad revenues

At the same time, COVID 19 impact on ad tech isn’t so straightforward. When some industries suffer from damages, Connected TV advertising is booming due to the fact that people spend more time indoors. The same trend applies to OTT, content streaming services, games, etc.

In these circumstances, brands and agencies are forced to adapt to the rapidly changing situation in order to take advantage of the traffic changes. Large eCommerce brands that have marketers and whole advertising divisions in-house can afford a quick redistribution of their budgets towards popular channels. Smaller and medium brands meanwhile are using managed services to get their campaigns aligned. Plus, there’s another cluster of companies, that in response to the crisis, are trying to reduce their spend on ad tech to the minimum transitioning from managed service to self-serve platform.

When you should turn to a self-serve DSP option?

Self-service platform provides the ultimate freedom campaign management, and this is the main advantage of this model. In recent years, a new category of brands has emerged. These brands are changing the traditional approach to customer communication and advertising by selling a product directly to the consumer (DTC advertising strategy). We're talking about brands like Glossier or Casper. They are innovative in the way they sell - online, with no extra charges or store rental costs, they don’t spend tremendous budgets on advertising, opting for a do-it-yourself marketing style.

Still, it should be mentioned that even with such an approach to marketing, self-serve advertising on DSP is preferred by the companies that have their own programmatic professionals. Their employees know how to configure the settings of the platform to take full advantage of targeting, budget, and other in-built functions of DSPs.

Truth is, advertising platforms strive to simplify their own tools as much as possible to make them easy to understand even for people who have no experience in tech or ad tech whatsoever. Still, all self-serve advertising technology providers including Google by default imply that companies that use their products have enough resources and expertise for setting up their campaigns independently. Otherwise, brands find assistance in ad agencies or go for a managed serve platform DSP option, which, in turn, is cheaper due to the fact that service is provided by the same company as a self-serve platform.

Thus, the self serve option will suit you best if you know how to use DSP, how to configure budget, targeting, and other setting up to your individual marketing objectives. Plus, you should have a professional who will navigate the campaign flow and dedicate their time to optimization. If you are ready for this, then a self-serve platform holds numerous benefits for you.

Benefits of self-serve DSP platform:

Cost efficiency. Simple, if you don’t get assistance, you don’t pay for it. This helps to reduce the cost of advertising to the minimum.
Flexibility. You can navigate and change the course of your campaigns whenever you want, reacting quickly to traffic changes and redistributing budgets to popular mediums.
Control. Through a single dashboard, you can configure every campaign detail up to your needs instead of relying on someone other. The results will 100% depend on your skills and efforts.

When you should turn to the managed services on DSP

If your programmatic ad campaigns bring mediocre results, in the majority of cases it is a primary consequence of poor campaign configuration, management, and optimization. That’s why there always will be a separate cluster of brands that work according to the serviced DSP model.

It is possible to test both variants. As well, after a while, when you get expertise and qualified employees, you can change managed service to a self-serve platform. Let’s see what kind of assistance you can count on with self-served DSP. First of all, your campaigns get full configuration: from targeting adjustment to budget allocation, advertising frequency capping, setting up ad tags, filtering publishers - all these relatively trivial tasks are taking a lot of time taking into account that configuration can be regularly changed (upon revision and optimization).

Essentially, using the same interface of DSP, full-service specialists will manage all your ad campaigns even if you have plenty of them planned across channels. Plus, using their knowledge about the most popular digital ad formats, traffic fluctuation patterns, the optimal sizes for reaching particular KPIs, etc., they will help you to build complex media strategies based on tested and proven advertising practices.

Let’s take apart a complex media strategy. The perfect version of a programmatic advertising campaign is when a user watches a commercial on one medium (desktop), then gets a reminder about the product — sees the continuation of the same ad on different media (mobile or Connected TV). Having memorized the brand name, the user will most likely buy the product in the future. Plus, it’s possible to show ads only to those users who once visited your website but didn’t convert. These retargeting campaigns increase the likelihood of conversion up to 90% and they also can be executed for you by the DSP team.

Benefits of managed-serve DSP platform:

Campaign configuration. The managers of demand side platform will configure campaigns specifically for your marketing objectives.
Continuous optimization. Knowledge and experience of skillful account managers will help to pace your campaigns correctly, with a maximum reach and efficiency.
No need to hire and educate staff. Programmatic requires a specific skill set and expertise. There’s no need to hire such people in-house if you need to run a seasonal campaign or two.

What’s for the takeaway?

If you think about transitioning from managed service to self-serve platform, you should be ready to devote substantial time to your campaign management, even if you know how to tune it accordingly at the start. Advertising is not static, the traffic volumes are constantly changing and if yesterday one medium was peaking today, campaigns may require you to distribute ad budgets differently. In ever-changing advertising realities, brands and agencies that have professionals with sufficient expertise in programmatic will reduce their budgets. If you are one of them, opting for a self-serve advertising platform can give you the freedom to decide for yourself and stay in control of your campaign flow. If programmatic is not your competency and you need someone to take campaign execution off your shoulders, our professional media strategists are here to help!