The big ad spenders are banking on programmatic advertising, with the majority surveyed planning to spend at least 40% of their digital media budget programmatically. That’s according to Joanne McConnell from AdExchanger in her The State of Programmatic Media report. With so much at stake, advertisers are looking for more effective and efficient ways to increase ad viewability.
In a recent Ad-IX/CxO roundtable, hosted by McConnell and SpotXchange Chief Technology Officer Allen Dove, a select group of ad tech CEOs, CTOs and CIOs gathered to talk about the benefits of private exchanges, such as the Equinix Ad-IX ecosystem, versus going over the public Internet. Here are some of their observations:
You need to be fast and error-free.
In real-time bidding (RTB), speed is not the only factor for success Ì¶ reducing the number of transaction errors plays a critical role, as well. With only 80 to 100 milliseconds to complete a bid, there’s no room for error. And, even with low-latency, high-speed networks, retries and error rates can be quite high.
With private peering over private, direct connections, Ad-IX customers experience both reduced latency and error rates. RTB completion rates can increase and ultimately save advertisers millions of dollars per day in RTB spending.
You’ve got to burst into the cloud to scale.
Suddenly, surge in demand is no longer a seasonal phenomenon. Each advertiser is placing more and more bids that require larger compute and storage resources. Many companies find themselves in constant buying/expansion mode.
Storage is a huge issue because companies may need to store all of their transactions for a minimum of 45 minutes. Companies can put all of their storage in the public cloud, access it when needed, and then recycle it for a minimum of 45 days. This kind of activity very quickly accumulates multiple petabytes of storage that is recycled each month.
Migrating to the cloud is key to increasing these companies’ compute and storage footprint, and everyone agreed that it is much more cost-effective to scale into the cloud, rather than build out their IT infrastructures. And with this extra surge in demand, bursting into the cloud is going to become business as usual. Direct access through the Equinix Cloud Exchange helps our Ad-IX customers interconnect to multiple cloud resources – on demand.
Fast, close interconnection matters.
The Ad-IX ecosystem hosts more than 25 ad networks, 15+ ad exchanges and 85+ ad companies, along with demand-side platforms and aggregators. By offering a private, direct interconnection between all of these parties, advertisers can decrease their average latency to single-digit milliseconds, allowing more time to complete data analysis.
Because companies within the Ad-IX ecosystem are communicating with each other quickly, their systems have more time to do the analysis needed to figure out what ads to place. On the public Internet, companies are at the mercy of high error and retransmission rates, which can consume tens of milliseconds of analysis time. The Ad-IX transfer rates are as low as 2 milliseconds, allowing systems more time to do the right research for a higher number of ad completions.
High global networking costs need to come down.
Most of the medium to large companies felt that network costs and the distribution of data globally was a big problem. It is difficult to get the right data sent to regional ad placement locations in an economic way. A hybrid network backbone model can be tested within a real-world Ad-IX environment in Equinix Solution Validation Centers.