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Game development is a long-term and very high-cost business. It’s nice if there is a large studio that can allocate resources for a new project or hire analysts who can calculate how profitable the project will be and advise how to achieve high revenue. But if the developers don't have all that or it's a small indie studio and a promising but not very well-known startup, you have to wonder how the game project will pay off. Of course, the game can be traditionally put on Steam or Epic Games, but as practice shows, if the project is not very popular, you will not earn very much. Most likely the profit will be from a year. It's not bad as a passive income for one game, but it is not suitable for studios that need to develop their projects. $8000 to $13000 That's why many developers choose the opportunity to create game apps with free downloads and advertising support. Together with our Enterprise team, we are actively following the game industry market and its connection with the advertising market. We are ready to share our experience and tell you which ways of monetizing apps with advertising can be the most profitable. Why use monetization with advertising? Everyone loves free stuff Many developers use paid elements in games, from in-app purchases to extended versions of games. But according to a study on only 0.67% of users are willing to pay for a game the first day after download, and while this number grows to 1.10% by day 7, these are still pretty modest numbers compared to the ability to monetize through advertising. That's why many developers are switching to this type of monetization. Paying User and Rolling Retention Rate, Advertising is profitable for everyone Not every user is willing and able to pay for the app. Many still think that spending money on pixels is stupid or fundamentally spending time only on free-to-play games. However, if a free-to-play game has advertising, the user is guaranteed to watch it, and everyone benefits from this. The developer can get a stable income from the application and invest in new projects or continue developing existing ones, the user gets his free game, and the advertiser gets a potential client by showing relevant ads to the user. It's possible to combine different monetization models In-app advertising isn't just about showing promotional videos or ads between game rounds. It also allows you to add other monetization models. For example, in-app purchases or reward videos. You can combine these models and use what is known as a hybrid monetization model, which has become over time. increasingly popular Case of Avid.ly Avid.ly is a Chinese mobile game development company. Back in 2016, they had several apps with a total number of daily active users of about two million. However, only a small part of that audience was buying something from the games. Back then, the main source of income for their apps was advertising. Avid.ly added cross-page ads, and static banners, and created a strategy that combined ads with in-app purchases. In the summer of 2016, they had the ability to create ads with rewards. Despite concerns about declining in-app purchase revenue, Avid.ly added the feature to their games. After that, for one game, average revenue per user increased by 40%, in-app purchase revenue rose by 18%, and session duration expanded by 20%. Which advertising format should I choose? Ad platforms usually offer a variety of different options for both ad options and performance. One thing may work for some apps and another may work completely differently for others. As with any business, it's all very individual here. That's why we suggest that you take a look at the different ad formats so that you can choose what exactly you need for yourself. Banners that are many years old, but are still alive and being well Probably everyone is familiar with banner format advertising: usually a rectangular picture with information about what they want to advertise to the user. Banner ads for gaming applications are not much different from those for websites or roadside billboards. How does it work? Banner ads are very easy to add to an app. It will take up a small section of the screen at the top or bottom, depending on the settings. These ads are shown continuously and do not interfere with the game. Banners change over time, showing different ads relevant to the user. The banners themselves can automatically adapt to the size of the screen of the device, occupying the entire width of the screen and having different heights depending on the device. This type of advertising is recommended for single-screen casual games. Advantages of using: Banner ads don't interrupt the gameplay, which means there's less chance that users will be annoyed with them; You can set the place on the screen where it will be displayed and its exact size; You can adjust the banner display frequency (however, it is not recommended to make the changeability of banners too fast, as it can affect the percentage of conversions, and the platform will be more difficult to select an advertiser for you); It is possible to automatically adjust the ad frequency (which means that the system itself will adjust the ad frequency so that they bring higher revenue). Disadvantages of using: A user may accidentally click on a banner with a link and go to an ad he didn't want to see. To avoid this, think carefully about where to place the banner (away from the main gameplay); This format of advertising shows less profitability compared to others because it triggers the effect of "banner blindness". Interactive cross-page ads This type of advertising covers the entire screen. Such ads may be in the form of videos or pictures. The user can close the ad. How does it work? Interactive cross-page ads are easy to add to the app. They do not affect the gameplay because they unfold to the full screen, hiding the gameplay. This option is suitable for games where there are breaks between levels or changes in locations. Advantages of using: You can set up pre-loaded ads so that they hit the cache in time and are ready to show when the user reaches the right moment; You can set the inter-page ads to show frequently for a certain amount of time. When setting it up, make sure that the ads are not shown too often, as this can irritate users; The price per thousand impressions is noticeably higher than for banner ads. Disadvantages of using: You need to test the optimal ad display frequency so that users stay loyal and don't get annoyed by the game; The impressions frequency is lower than that of banner ads. Native ads Native ads are adapted to the content design of your game. It can be a video, an image, or text with an advertisement. How does it work? These ads are more complicated to customize than the first two types because you need to choose settings for the main ad color, text font, text color, etc. We recommend adding it to game content, menus, or the loading screen to avoid annoying the user and confusing ad integrations with gameplay elements. However, due to the fact that this type of ad is not immediately read by users as advertising, such ads can be very profitable in the long run. Benefits of using: With a clean game screen with no banners or other third-party elements, the game will visually remain consistent with its style; Does not interrupt or slow down the gameplay, and therefore less annoying to users; Ads will always be highlighted with the ad marking. Disadvantages of using: Requires careful customization of content so it doesn't stand out from the main design. Reward Ads These are ads that the user can interact with to get some bonus in the game: in-game currency, lives, resources to upgrade weapons or characters, etc. Game app developers love this monetization model because it increases player engagement, and according to recent statistics from ironSource, it also motivates players to make in-app purchases And prefer video ads with rewards over banner ads. six times more often. 76% of mobile gamers in the U.S. How does it work? It's easy to add to the app. You just need to establish what exactly the users can get when they view the ad. It's up to the user to decide whether to interact with the ad or not. Benefits of use: Increases player engagement by allowing rewards; Can set up pre-loading so the user doesn't have to wait; Can motivate purchases (if you give a portion of a reward that the player can get for a fee, it brings them closer to buying the same resource in the app itself); Gives freedom of choice to the player, which means the level of annoyance from advertising is reduced. Disadvantages of using: More difficult to set up than banner or cross-page ads; The number of ad impressions may be lower due to the fact that players are given the choice to "not watch ads". Combine Ad Formats All of the ad formats we've talked about in this article can be combined. For example, many developers combine banner and cross-page ads or reward ads with native ads. It all depends on what kind of game you have and what ad format is best suited to monetize while not reducing (ideally even increasing) user engagement with the game. But it can only be understood by testing different ad formats and their combinations. How to simplify monetization through advertising? Usually, to monetize an app through advertising, developers turn to software platforms that provide such services. However, if we are talking about a company that has more than one app or game and all of them need monetization, the best solution is to get your own programmatic advertising platform. Developing such a platform from scratch costs a lot of both monetary and human resources, so many developers turn to . These are off-the-shelf supply-side programmatic platforms that can be easily customized to your brand. Such a platform will allow you to create advertising platforms from your applications in one space. white-label SSP Benefits of using a White-Label SSP: It's an off-the-shelf product that you don't have to create from scratch; Unlimited customization options, from interface colors to section layout; No need to spend time finding a development and support team for the platform; All advertising monetization options for all products are in one place. Disadvantages of using White-Label SSP: Standard platforms may not have all the features you need (but providers usually have different advanced product variations); That’s why it is better to opt for services that offer additional customizations. In addition, some platforms, such as , provide their clients with support not only on the technical side but also help with inventory selection and settings for your app monetization solutions. This is a very good option if you don't have an in-house specialist with a similar profile. SmartyAds Any doubts? That's good! We know those game developers are often very sensitive to their "children" because games and game apps are the results of long and painstaking work. And we know that sometimes advertising can seem a kind of "desecration" of this work. What if banners look ugly on the game screen? What if ads popping up between levels alienate players? What if there is something in the ads that contradicts the sense of the game? All of these questions are logical, correct, and understandable. No one wants to mess up their product with bad advertising. That's why before you run ads in an app, you should check out what the software platform you are going to choose has to offer. That is why it is better to use well-known and trusted platforms because they guarantee the quality of advertising and advertising platforms.

How to Monetize Your Mobile Gaming App

Traditional offline out-of-home advertising (OOH) is gradually becoming obsolete. Advertisers are no longer making long-term investments in static billboard ads - such placements are already so customary that they skip the eyes of the passers-by and quickly get forgotten. While online ads are already overrepresented on the web, DOOH has just marched into an active stage of development and is already winning the hearts of advertisers as it doesn’t cause ad fatigue and banner blindness. As a relatively new advertising medium, DOOH attracts many enthusiasts, searching for opportunities to open their own ad platforms and capitalize on them. Creating your own DOOH solution is a very challenging task that will require a lot of planning, investment, and effort. That’s why we decided to discover whether the game is worth the candle and if there are other ways to simplify the challenge. So, why DOOH DOOH is an acronym that stands for "digital out of home". Basically, it is a digitalized format of traditional out-of-home advertising. The purpose of such advertising is to display effective branding campaigns on digital billboards and many other kinds of digital screens that one can encounter in public places: airports, sports venues, concert arenas, shopping centers, major transport interchanges, subways, and so on. This allows advertisers to: Get a large reach of potential buyers; Attract new customers; Promote the brand and increase brand awareness. With this, it is worth pointing out that DOOH is a relatively new and innovative advertising technology and the infrastructure for it is still being developed. While the average, traditional out-of-home billboards display the same ad message to everyone (or show several ads one by one), DOOH works according to different mechanics that deliver more in-deep personalization. How does DOOH work then Modern data technologies at the core of the DOOH allow it to interact with the target audience based on available data sets that can personalize the advertising experience for the selected group of people. Sure, the targeting precision on DOOH is far from the one available on personal devices, since it is not based on user cookies or contextual signals. Still, as practice shows, DOOH can leverage the incoming data (most frequently data about the outside environment) to interact with users in a more meaningful and personalized way. A good example of it (and for sure not a single one) is a DOOH ad campaign delivered by ActionAid near the Piccadilly Circus. It aggregated live data from the local weather station and showed the ads based on weather conditions in order to draw public attention to climate problems. Likewise, DOOH can leverage other information like time, location, the current availability of products, and more data to keep the ad messages up to the point. With this, advertisers can address their audiences more effectively than on static banners. Additionally, static billboards cannot track traffic or count how many impressions were served per hour, per day, for the entire duration of the campaign. That’s where the main advantages of DOOH stem from. Why do companies strive to build their own DOOH solutions Taking the abovementioned advantages and the innovation of the DOOH format, the popularity of digital out-of-home advertising is expected to grow. It opens up a number of opportunities for companies that strive to build programmatic advertising products for this emerging space. As pandemics are coming to an end and more people venture outside for traveling and offline activities, the experts expect that advertising budgets will largely be distributed to the DOOH channel once again. Apparently, the ad spending in DOOH is expected to grow exponentially through the years so that by the end of 2027 it will account for in the U.S only. Naturally, this innovative advertising medium attracts more and more interest from advertisers. $15.905 Meantime, the ad tech providers are striving to equip their technologies with DOOH capacities to satisfy the growing need of their clients. companies, like Clear Channel Outdoor, Lamar Advertising, and Outfront Media, are actively pursuing the opportunity to advertise with DOOH. However, since the DOOH technology is still developing, most parts of the DOOH ad placements are performed manually. Large OOH advertising The robust programmatic DOOH solutions are only starting to emerge, so many businesses are searching for opportunities to pioneer this vacant niche with the power of automation. What are the main business use cases of building a custom DOOH advertising platform To capitalize on ad-tech business. This is the most obvious reason why companies strive to build a DOOH platform. They plan to open their own ad tech platform to provide services to clients (advertisers who run DOOH campaigns through their platform). To sell or buy available DOOH inventory. Publishers that have DOOH inventory normally need to join an environment where they can monetize it with DOOH advertising (SSPs). Some companies build DSPs so that their advertisers could effectively reach DOOH advertisers and run such ad campaigns. To diversify the business. Many agencies are branching out by opening their own programmatic DOOH platform. The others also plan to add new capacities to their existing solutions and extend the scope of provided services by this. Why you should build the DOOH platform based on white-label Creating an ad tech platform entails the same time-consuming stages as creating any other software platform: coding, team and project management, licensing the solution, and then maintaining it and keeping it updated. In case the company has sufficient investments, human resources, and time, this task can be considered feasible. However, these days the ad tech industry developed an easier way for companies to enter the programmatic market. The white-label model has been used by various industries as a business concept, especially since it is popular in IT. The essence of it is that the tech provider creates a pre-built technology core based on which the startup can build its own solution. Unlike in the popular franchising model, in this case, the company labels the new solution as its own, establishes its own rules, and pricing, and adjusts the product according to its own needs and operational requirements. Benefits of building the DOOH platform with a white label: A pre-built core allows companies to effortlessly unfold their own DOOH solution in the shortest time possible. Since it requires less time and less labor invested in the process, it naturally reduces the cost of installation. Reduced costs and time. Less labor involved means less money is spent. Additionally, you don’t need to hire people for further solution maintenance as white-label platforms are normally hosted and maintained by professional teams. Less labor is involved. Building your own DOOH solution from scratch is a challenging adventure, but you have to be 100% sure of the quality of the finished product. When you build a DOOH solution based on a tested and proven tech core, you don’t have to worry about potential bugs or operational issues. Fewer risks. The DOOH ad campaign delivery is automated by programmatic algorithms that ensure the efficiency of the media trading process. Additionally, like those delivered by SmartyAds, feature bid optimization tools, and smart algorithms that optimize the traffic and increase platform profitability. Optimized advertising environment. white-label solutions The programmatic advertising ecosystem is multilayered and complicated. Each middleman and vendor should comply with the principles of the GDPR, CCPA, COPPA, and other international privacy acts, otherwise, the ad tech provider might be penalized. With white-label solutions like SmartyAds, companies don’t have to worry about the legal part of the technology functioning since it corresponds to all necessary requirements. Privacy-friendly secured media trading. Conclusion As they say “one should not put all the eggs in just one basket,” so advertisers no longer stick only to web ads but also actively diversify their media mix with DOOH campaigns. Because of this, the popularity of DOOH advertising platforms only grows and is expected to grow more with time. Agencies and advertising companies that strive to establish themselves as DOOH advertising pioneers have the best chances to do it in 2022 since new models like white-label streamline the process and make it less complicated.

5 Reasons to Build a White Label Programmatic DOOH Advertising Platform 

In a famous scene towards the end of Indy, the story’s protagonist (along with his cohorts and a few rivals) set out to find the Holy Grail, a fabled cup thought to grant immortality to anyone who drinks from it. When he and his fellow Grail seekers finally reach the end of their odyssey, they find themselves in a room containing many Grail-like objects, guarded by a Knight. Here they learn that their trials are not yet over. “Choose wisely,” the Knight says, “for while the true Grail will bring you life, the false Grail will take it from you.” That is to say, drinking from the real Holy Grail will indeed have the desired effects, but sipping from any other goblet will result in . Indiana Jones and the Last Crusade, having a very bad day Your company’s data plan is the Holy Grail of your organization’s data strategy. While developing this document is not necessarily as harrowing as Indy’s quest, it does entail a significant amount of strategizing, collaborating, and creative thinking on part of the stakeholders involved. The “life” the Grail delivers is akin to the benefits that teams reap from the data plan––mainly, the ability to leverage quality, complete, and accurate data. Realizing these benefits hinges on a choice––that is, developers must choose to use the most recent version of the plan as the basis for implementing data collection. Finally, Indy was able to recognize the true Grail by its simple, unadorned appearance that made it look like the “cup of a carpenter” as he remarked. A data plan is similarly simple yet powerful––a straightforward solution to a complex problem. If you push event-collection code based on an outdated data plan version to production, the work that went into creating that latest version of the data plan will not come to fruition, and marketers and PMs may make decisions based on outdated data. Worst of all, engineers will need to spend time rectifying this error, which could entail not only finding and eliminating the source, but purging it from pipelines and downstream systems as well. This is why we at mParticle built . The tool came to life thanks to the creativity of Alex Sapountzis, an engineer who likes to make life easier for other engineers, especially those who spend much of their time working in web environments. In addition to Smartype Hubs, Alex has built developer-centric , , , and a that can be used to communicate with various mParticle services. Before we dive into what Smartype Hubs are, how they work, and how you can get them set up in your projects, it’s worth revisiting the tool whose functionality they help extend and improve: Smartype. Smartype Hubs Web SDKs Media-focused data collection SDKs Linting tools Command Line Interface Smartype: A brief overview is a tool that automatically translates a data plan represented as JSON schema into usable code for iOS, Android, and Web platforms, exposes these methods via an API, and enables developers to call events within the auto-complete function in their IDE of choice, rather than implementing them manually. Using Smartype, engineers do not have to reference the details of their data model (like attribute names, data types, etc.) in order to correctly implement the data plan. This benefits developers not only by streamlining the data plan implementation process, but by avoiding time-consuming debugging that could result from these errors as well. Smartype To learn more about Smartype, check out this , or of how to use it to send user events to any third-party database or library. overview of its functionality this walkthrough Extending the audience and use cases for Smartype with Smartype Hubs Smartype Hubs are a collection of scripts and Github Actions that provide a way for engineering teams to automatically synchronize data plan versions as part of their CI/CD process. Additionally, Smartype Hubs generate custom Smartype SDKs based on this latest data plan version that can be imported into your organization’s Github projects via NPM. The latter benefit is particularly useful for engineers working on web projects, who commonly work with stacks in the JavaScript/Typescript ecosystem. Since Smartype is built on Java and Kotlin, having a tool that bridges the gap between Smartype’s Java foundation and the web-native languages with which front-end developers commonly work is beneficial. “As engineering projects evolve,” Sapountzis says, “it becomes computationally and mentally expensive to require an engineer to introduce another layer to their stack. Over the last decade, many “Full Stack” engineering roles are replacing other “backend” technologies with JavaScript/TypeScript across the stack. I thought it would be great to let them not have to complicate their stack to get the benefits of Smartype.” Getting started with Smartype Hubs To start using Smartype Hubs, you need to have access to an mParticle workspace. Once you do, within this workspace, then . Next, create the actual hub (a Github repository) by selecting the “Use this template” button at the top of . create one or more Data Plans generate an API key and secret this example Next, clone your hub locally, and edit the file at the root of this repo with the Data Plan ID and versions you would like to sync to the Hub: mp.config.json {
  "smartypeHubConfig": {
    "dataPlans": [
      {
        "dataPlanId": "example_data_plan",
        "versions": [1, 2, 3]
      },
      {
        "dataPlanId": "another_example_data_plan",
        "versions": [1]
      }
    ],

    // This is the directory where data plans will be created
    // The directory must exist in your file system before you run the process
    "dataplanOutputDirectory": "dataplans"
  }
} Now you’ll need to tell your hub which mParticle workspace/client ID and client secret to look for when fetching your data plan by adding some encrypted secrets to your Hub. To do this, click Settings => Secrets => ”New repository secret”, and add the following: MP_WORKSPACE_ID: The integer ID of the workspace that contains your Data Plan(s)
MP_CLIENT_ID: A client ID with access to the Data Planning API
MP_CLIENT_SECRET: A matching client secret with access to the Data Planning API Now that your Smartype Hub knows where to find your data plan, it’s time for the magic to happen. Smartype Hubs uses Github Actions to fetch the specified Data Plan and generate your Smartype SDKs. Within the “Actions” tab of your Hub’s repo, click “Generate Data Plans,” select the “Run Workflow” dropdown, choose your desired branch, the click the “Run Workflow” button: Once the job is complete, your Smartype Hub will have done three things: Retrieved the latest version of your specified Data Plan from your mParticle workspace Created Smartype SDKs based on this version Published these SDKs as NPM packages to your organization’s Github Package Registry under a name based on your Github owner account, the name of your Hub, and a Data Plan ID. Since the npm packages that Smartype Hubs generates are not published to the NPM registry but to your Github Package Registry, anyone importing them into a project must be part of your organization. Importing a Smartype Hub Package into your projects Now that your packages have been generated, you can import both the latest version of your data plan and the Smartype SDKs based on this plan into your project. To do this, first create an file in the root directory of your project with your Github account owner and registry URL. For example, if your company name were Higgs, you would add the following to your file: .npmrc .npmrc @higgs:registry=https://npm.pkg.github.com/ Now you can run an from the command: npm install npm install @<higgs>/<smartype-package-distribution> This will automatically update your package.json and add the latest version of your data plan to your project. Note that if you made your Smartype Hub private, you will need to make sure you configure authentication. All of the benefits of Smartype without switching development environments And that’s it! Now you have your latest data plan and Smartype SDKs in your projects, and you did this using web-centric languages and development tools––no Java installation was necessary. Smartype, and all of its code-completing, error-preventing, time-saving benefits, is now a part of your CI/CD process, as is the process of synchronizing your project with the latest version of the Data Plan in your mParticle workspace. Perhaps Alex sums it up best: “If Smartype can export your data plan into code that works for your platform, why bother having to use Java when you can just import your data plan as a package in your language of choice?” Want to receive curated reads from the data engineering landscape? Sign up for mParticle’s . Written by developers, for developers, including content such as technical blog posts, documentation updates, and curated reads from the data engineering landscape. mPulse Developer Digest

Smartype Hubs: Keeping Developers in Sync With Your Data Plan

White label DSP platform gives advertisers a chance to open independent ad tech businesses, set their own conditions and influence the outcomes of media-buying directly, without third-party providers. When advertisers go autonomous and what white-label gives them, let’s take a look. If of budding startups die within the first year because they find no demand for their product on the market, with programmatic business, everything is slightly different. Programmatic advertising has a reputation of a very profitable business — in 2019, the growing share of algorithmic (programmatic) ad spend outweighed all other kinds of media-buying ( digital display ad spend). more than 42% 84% of total According to the eMarketer, in 2020, programmatic ad spend will generate , and by the end of 2021, ad spend is supposed to grow to an unpreceded $79.75. This means only one thing: programmatic continues to redraw the digital advertising ecosystem. $57 billion Source Many years ago, built their own programmatic platform as a way to save a good share of their media costs. Last year, about a complete shift to in-house programmatic that was supposed to make their media purchases crystal-clear and transparent. Netflix and Kellogg Buyer reported If you are a novice in programmatic advertising, chances are you think in-house programmatic is for big businesses like these. However, brands that have tried white-label DSP prove the opposite — this new approach helps to build your own programmatic platform in-house without substantial financial injections and risks. So, if you're interested in how to enter Ad Tech business, let's make a profound analysis of some core things: ●      What is a DSP? ●      What is a White Label Technology? ●      How it is different from White Lable DSP? ●      How to find out whether you need to step on independent grounds of programmatic? What is a DSP and why advertisers use it: 3 most important functions Demand-side platforms automate the process of online media buying and this is their most important function. Technically speaking, it is a software platform that features connections to SSPs, ad networks and ad exchanges and enables advertisers to purchase inventory programmatically, usually via RTB (real-time bidding auction) as the picture below illustrates. Source DSP doesn’t shoot blindly to whatever bid comes its way; it needs a definite set of rules to act upon and advertisers provide the platform with such directions in the user interface. Targeting (OS, gadget, age, gender, zip, channel and more), frequency, budget limitations, filters, etc., — all these criteria take part in the decision-making process. They enable delivering ad messages to the right audience at the right time and device. They also limit the number of impressions per user to prevent ad fatigue and budget overspending. Strengths of DSP solution that can’t be found in manual media buying ● As mentioned above, the platform uses the rules defined by the advertiser to automate the purchasing process. Responsible technologies: AI and ML. Buying activities automation. ● . With automatic auctioning, bid approval and ad serving, there’s no need to negotiate the placements, make credit card transactions for every placement or arrange email correspondence. As soon as the user with relevant cookies opens the page (app), DSP defines the potential worth of the bid and joins the auction. Cost-efficiency and speed ● . Negotiated placement leaves little maneuvering for advertisers to change something about their ad, even if it doesn’t bring a return on investment — the ad is paid for and it’s placed somewhere for a definitive period. DSP platform makes real-time analytics. If something isn’t working, there’s always a chance to change the campaign flow in real-time. Real-time optimization ● . With DSP, advertiser gathers all campaigns in one place – on one DSP dashboard. Unlike manual placement, the advertiser doesn’t have to attract sales reps or agencies. Everything can be done by one person (self-serve DSP) or a team of DSP specialists that assist managed-serve campaigns (sometimes via ATDs). Only one person to operate What is a white-label technology? White label concept is a type of partnership where one company produces goods, services or technology and another one purchases it and re-sells it under their own brand. This way, each partner can focus on their core competencies (production or sale) and thereby save substantial costs, essential for new business launch. What is a white-label DSP platform? White label DSP platform enables taking this very same DSP technology in house, which means enterprises can purchase prebuilt DSP software, customize it and label it as their own solution. With white label DSP, the purchaser of the platform can operate as: A white label DSP reseller: sell DSP services for brands on a commission basis A media-buyer: optimize their own media buying costs An agency: streamline work for clients or provide them with self-serve accounts Where white-label outruns self-development? Like any programmatic solution, the demand-side platform is a complex thing that requires building the software system and plugging it all in the vast programmatic infrastructure. RTB, ad server connection and partner integrations are not even making a fraction on the full list of must-dos. When building a DSP platform from scratch, business owners need to attract the full specter of professionals in many areas of expertise: ad tech professionals, software developers, project managers and q/a testers. Then, they have to wait until the product roadmap slowly turns into a robust, working and market-licensed platform. This can take months, or more (depending on your team). half a year Source White-label DSP solution is a pre-built, SaaS-based technology that is already fully hosted, maintained, built with RTB integrations and only requires minimal customization. This alternative business building approach removes all the burdens of building the platform from scratch: developing, designing, testing, licensing and hiring people to scale it up when the business expands. Costs. ‘Building your own DSP solution’ is a phrase that already sounds costly. However, if building a platform from scratch may take somewhere between (again, heavily depends on your team), the white-label model will make it happen for  $1 000 to $50 000 (pre-made technologies are known for their affordability). $40,000 and $250,000 Why do companies look for white label DSP platforms? White label DSP platforms are gaining momentum because more companies are striving to take their programmatic purchases in-house. By the end of 2019, and 65% of publishers in Europe had taken their programmatic purchasing in-house. 38% of advertisers, 66% of agencies Source Why are they doing this? Even though programmatic allows agencies to simplify and automate media-purchasing as much as possible, it still experiences challenges associated with insufficient transparency, also known as a ‘black box problem.’ Some DSPs don’t disclose terms of cooperation, so the agencies can’t deliver to customers relevant information concerning service commissions and margins that DSP charged them with. As a result, brands see only the total cost of services and are unable to distinguish what they are paying for. By selecting an in-house strategy, expect to increase operational control, reduce media costs (42%) and gain greater transparency on where campaigns run (33%). 50% of advertisers Do you need to set up white-label DSP? White label DSP solution enables a simple shift to in-house programmatic media-buying. While self-serve DSP may perfectly satisfy the needs of a small brand, in some cases, business needs may overgrow the basic abilities of DSP. The following examples can perfectly illustrate this point: . Exactly, for this reason, buyer brought programmatic in-house and saved approximately . Sure, if your regular media-spend is small, there’s no point to worry about DSP service commissions — normally they won’t exceed 30% per bid. Saving money $10M during the first 6 weeks For instance, if you spend $1000 per month, it will barely reach $300. However, if regular media spend of yours climbs up to e.g. ~$29,000, you will leave $8,700 on the table. What is a white-label DSP in terms of payment — it is a subscription-based platform that only makes the fee of the generated ad spend. So, if the ad spend is ~$29,000, with a normal 5% fee per month, you give out $1,450 instead of $8,700. Source Building your platform with a white label DSP solution enables you to set up a functioning platform in less than a month. Most importantly, it helps to overcome one fundamental business building risks: as the platform is already time-proved and finished, this is a guarantee that technology will be bug-free and robust enough to measure up with big and reputable programmatic platforms. Scaling and avoiding risks. For some companies, a white-label solution is a chance to join an RTB ecosystem effortlessly, and for others, it is also a chance to scale their platform anytime. The solution is based on the remote servers, so updates, upgrades and improvements will be happening on the background — there’s no need to terminate operation in order to scale capacities. Customer data protection and advertising fraud are the weak spots of the advertising ecosystem. Brands that accumulate and use for targeting at times fear that it will flow through a third-party supplier to competitors. Ensuring safety and consistency. first-party data The world has known enough examples of data misuse — is only the loudest of them. For this reason, advertisers strive to independently control user data and quality of traffic (applying scanners and monitoring statistics in real-time). Cambridge Analytica scandal In order to extend potential reach, advertisers are often pushed to work with several DSPs, which creates another roadblock to effective targeting — bidding against your own bids in different auctions. White label DSP, in this situation, is the best shield against competing against yourself as you track each activity of the system. Source Additional strengths a white label DSP solution may have: Ability to connect existing SSP partners via API and obtain their user data Ability to order on-demand features, integration and customization Ability to support the widest range of ad formats Ability to modify the system and integrate external modules via API Things you should know before building white-label DSP platform White label DSP platforms are solving a lot of problems that non-proprietary ad tech solutions can’t. Still, can we expect that the advertising industry will completely transition to in-house programmatic in the years to come? On the one hand, big players are massively heading in-house; on the other hand, the number of brands that open their own programmatic platforms and departments is relatively small and there’s nothing wrong about it. The reasoning of enormous budgets behind opening your own programmatic platform is nothing more than a common misconception. As was illustrated on the media-budgets example above, if a company doesn't spend a lot of money on media, buys inventory rarely or seasonally, there is no need to buy advertising platforms and run independent advertising businesses. Why would you buy a ship if you only sail once per year? 1) Your budget. Plus, there will always be players who follow the model of key competencies and who will not try to embrace innovative technologies or business models just for the sake of it. Before you adopt any technology, you should always ask yourself what problem it is supposed to solve; only then will it bring you profits and desired return on investment. Not every advertising agency or enterprise has sufficient experience in the programmatic business. Sure, white label DSP providers will build the platforms from the ground up for you, but the promotion, market positioning and operation as a whole will be entirely on you. Your platform is your business — no one dictates you or patronizes you on what payment model to use, what partners to befriend or where to put the label in the dashboard. 2) Where to get expertise. In order to effectively cope with operational tasks and optimize ad campaigns on behalf of their clients (the success of which depends on so many conditions), it is necessary to have programmatic professionals in staff, sometimes entire departments. For this reason, even with the growing popularity of in-house, many companies will still rely on agency experience. The others, meanwhile, select the strategy where the DSP operation process is fully or partially outsourced. The takeaway DSP is a complex technological platform that streamlines and effectively automates media-buying. However, construction and launch of it can be very expensive if you build it from scratch. In addition to costs, you need to invest in development, testing, and platform customization, building your own infrastructure can take the time that otherwise could be spent on conquering a new programmatic niche. White label concept is an amazing choice if you keep it in mind the idea to start you own business in ad tech and plan to create a branded DSP technology of your own. For many enterprises and agencies, the construction of a DSP is impossible from a financial standpoint. However, if you spend a lot of your budget on media-buying, then the decision to get your own programmatic solution may look pretty appealing. White label DSP solves the problems of enhanced fees, insufficient transparency and accountability of the media-buying. It cannot be ruled out that in ten years, technologies like white label will make the programmatic businesses a commonplace for every company. However, in making such an important decision, every entrepreneur must also give oneself answers to the questions: “What gaps am I covering?”, “Who will be in charge of operations?” and finally “Am I ready to run my own advertising business?” ( : ) Disclaimer The author is the CMO at SmartyAds

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