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Automated Yield Optimization: A Win-Win for OOH Media Sellers and Buyers

Digital out-of-home (DOOH) advertising makes up nearly 30 percent of global out-of-home (OOH media) advertising revenue and continues to grow each year. To keep pace with the increasing demand, DOOH publishers need a simpler way to manage digital inventory and programmatic transactions. This can be challenging to achieve, however, when the industry’s current approach to yield optimization is largely manual. Rebalancing DOOH supply and demand this way can limit campaign flexibility and translate to slower sales cycles, suboptimal yield, and missed revenue opportunities. Automated yield optimization, however, could provide just the solution DOOH needs to enter its next phase of growth and take advantage of an eager media buyer audience seeking out third-party targeting alternatives.

Working with OOH Media is Similar to Navigating a Game of Tetris

DOOH inventory allocation is like a game of Tetris, with each block representing a buyer’s campaign goals. A restaurant, for instance, might run its ads close to the lunch or dinner rush, whereas an alcohol brand may schedule its ads to appear in the late evening when nightlife is most active. Every campaign block is unique, and the more tightly publishers can integrate the blocks, the greater the revenue potential and the more clients they can satisfy.

With so many competing advertiser priorities – from creative formats to time of day, impression targets, budget requirements and weather triggers – minimizing these gaps can seem like an uphill battle. Further complicating the challenge, media buyers demand real-time responsiveness and the flexibility to make changes to campaigns on the fly. Multiply these hurdles by hundreds or thousands of digital screens and it equates to significant complexity and potential for lost opportunities.

Automated Yield Optimization: A Winning Strategy

Success requires a well-defined strategy, and automated yield optimization can provide just that for DOOH. The algorithm-powered process automates inventory allocation and reallocation, reducing unused inventory and ensuring that all screens on a network are always delivering to their maximum capacity. In terms of the Tetris analogy, it automatically stacks blocks as closely as possible, and re-stacks them when parameters are changed.

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Broadsign has already begun work with customers to envision technology that’s able to accomplish this. Our yield optimization engine evaluates DOOH campaign allocations across a media network, based on the parameters of the campaigns it needs to deliver. The engine then calculates a schedule that accommodates as many campaigns as possible.

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As the ad industry shifts to more contextually driven campaigns, this level of flexibility is necessary to ensure that space is available to serve up ads based on weather, time of day, stock markets, traffic, and other triggers.

Connecting Guaranteed and Non-Guaranteed Media Buys

Automated yield optimization also helps media buyers to combine guaranteed and non-guaranteed DOOH buys, opening the door to a new delivery model based on campaign value. Guaranteed media buys present specific inventory purchased with an assurance of delivery, so they’re often priced at a premium versus non-guaranteed campaigns. Non-guaranteed media buys share many, if not all, of the targeting characteristics associated with guaranteed buys (i.e. location, audience, time of day, etc.), but without assurance of playout delivery, so they can be offered in infinite capacity.

For media owners, supporting these non-guaranteed campaigns provides a flexible ‘buffer’ (with low revenue risk) while prioritizing the delivery of guaranteed campaigns. Additionally, since pricing is driven by demand and what buyers are willing to pay, pricing for non-guaranteed buys can actually surpass that of guaranteed buys, to the benefit of the seller.

With automated yield optimization, DOOH ad delivery can be based on campaign value. Even though selling and delivering 100 percent of available inventory slots is a near-impossible task, automated yield optimization brings that goal within reach. It helps to ensure that buyers receive ideal pricing and placements, while allowing sellers to maximize inventory and profits.

Bottom Line Impact

OOH media is one of the oldest advertising formats, and has continuously reinvented itself — first with its shift to digital, followed by programmatic trading. Automated yield optimization marks the next big evolution for the medium, streamlining how media owners approach DOOH management and sales for future success and scale. With it, media owners can offer all types of media buys together, rather than being limited to set parameters like spots per loop, share of voice, or audience impressions and plays. Rather, media buyers can leverage a mix of strategies to achieve all of their campaign goals. Even if they want to only buy spots per loop, they can still benefit from automated optimization. This means they’ll be able to spend less time in spreadsheets, and more time focusing on clients.

Our customers, Clear Channel International and Intersection, are already experimenting with automated yield optimization. We’re working with other media owners around the world to continue improving the technology. The ultimate end goal is to give media owners the tools they need to modernize and automate their infrastructures. Optimization engine-supported flexibility ultimately means that they will be able to better meet media buyer needs, in a smarter, faster way. As DOOH becomes easier to buy and sell, it then becomes more accessible to media buyers who previously hadn’t considered it as a viable option, further advancing the medium and its impact.

[To share your insights with us, please write to sghosh@martechseries.com]

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