Driving demand-side efficiency with Smart Supply

Thursday, June 06, 2019
By: Samantha Solmonson

Some things in life are simply inevitable, like death and taxes.  So too is the increasing volume of ad inventory and impressions, which is why DSPs and SSPs will likely continue to see their infrastructure costs rise.  For this reason, MoPub is dedicated to developing innovative exchange efficiencies that help maximize scale and performance while limiting excess costs and waste for our demand partners.  Smart Supply is one example of how we are driving buy-side efficiencies through product innovation.

What is Smart Supply and how does it work?  

Smart Supply, a machine-learning algorithm built by MoPub, is the proprietary logic we use to score our publishers’ supply on MoPub Marketplace and send each QPS-constrained bidder the maximum amount (up to its QPS limit) of the highest-scoring supply.  This innovative approach leverages our unique knowledge of supply value to each QPS-constrained bidder based upon its historical behavior on MoPub Marketplace.

The algorithm evaluates DSPs’ bid rates against various data attributes, such as: ad format, size, app, publisher, time, geography, and device (i.e. model, connection speed, language, carrier, OS). Furthermore, because the relevance of each attribute differs by DSP, we customize Smart Supply by weighting the query attributes individually for each bidder.  

Using this logic, Smart Supply assigns a score to each bid request in real time, sorts all available supply in order of relevance to each bidder and then sends the top-scoring bid requests to fulfill 90% of each DSP’s maximum queries per second (QPS) threshold, as specified by the bidder in the MoPub Demand Platform (MDP).  In order to continually train the algorithm and measure its performance, we send DSPs a completely randomized sample representing the remaining 10%.

Benefits

The evidence is clear that Smart Supply helps our DSPs perform and maximize efficiency.  In aggregate, across all QPS-constrained bidders on MoPub Marketplace, we’ve seen 29% higher bid rates, 10.5% higher win rates and 7.08% higher clear rates on Smart Supply versus randomized supply samples.  A large DSP partner saw as high as 71% higher bid rates, 24% higher win rates and 41% higher clear rates.

MoPub currently passes approximately 700,000 QPS through our exchange, an enormous volume of ad opportunities rife with trillions of data points, akin to a bid stream “firehose.”  As more apps are developed and devices increasingly saturate every market across the globe, ad inventory (and therefore, bid requests) will continue to multiply rapidly.

This is good news for advertisers and their DSPs who need high scale to achieve campaign success. The reality, however, is that none of our 180+ DSP partners ingest all 700,000 available QPS and are all-too-cognizant of the costs involved in doing so, mainly in the form of servers and other IT infrastructure.  

Ultimately, Smart Supply benefits DSPs by increasing the volume and reach against desirable queries while reducing the volume of filtered-out queries, which are themselves a waste of capacity and therefore cost.  Overall, we see reduced cost and anticipate higher performance when putting the right message in front of the right user at the right time and place.

Additional efficiencies

To help DSPs efficiently manage their own access to our supply, we offer DSPs the ability to manually control their access to supply within the MoPub Demand Platform (MDP) by setting QPS maximums and applying supply filters like country and ad format.  

We noticed that some bidders tend to create granular segments filtered by format and/or geography, and manually specify individual QPS limits per each specific segment.  As these DSPs launch new campaigns over time, demand per segment tends to fluctuate, which means they could be missing out on valuable bids. Therefore, we recommend as a best practice that DSPs create broader segments with a single, total QPS limit.  This will allow for Smart Supply (which already accounts for both geography and ad format) to score and allocate bid requests and maximize efficiency for the bidder. For further information or questions about setting up efficient segments, please reach out to your MoPub representative.

Looking ahead

As supply volume continues to grow, DSPs will continue to be constrained and need to find new ways to optimize their infrastructural investments. We are constantly evaluating and testing new techniques that could potentially make Smart Supply even “smarter” at matching supply with demand.

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