- Following a test with advertisers, Facebook (FB -1.9%) has pulled the plug on a demand-side ad-buying platform (i.e. a DSP) for its Atlas ad-server/measurement solution.
- Ad tech chief David Jakubowski states low ad quality drove Facebook's decision. "[W]e plugged into a number of the usual exchanges and bought across several formats ... We were able to deliver ads to real people with unprecedented accuracy, but came up against many bad ads and fraud (like bots). While we were fortunately able to root out the bad actors and only buy quality ads, we were amazed by the volume of valueless inventory."
- Notably, he adds the only ad formats that "delivered significant value" during the test were native ads (Facebook and Instagram feed ads are native ad types) and video ads (another area Facebook is well-exposed to). Not surprisingly, mobile ads in general delivered much of the "true business value" found in the test. Facebook VP Brian Boland claims native/video ads delivered "7x better results than banner ads."
- As part of its efforts to double down on ad types it considers effective, Facebook is rolling out new tools for Atlas: A tool for measuring the impact of online ads on offline sales, a service that gives advertisers insights on how users see ads across devices before making a purchase, and a video-ad-serving/measurement service. Jakubowski: "[M]any marketers still choose to deliver and measure their ad campaigns using desktop-first tools that are not built for a cross-device world — and they’ve got the wasted spend to show for it."
- Facebook has tried to differentiate Atlas in part by using anonymous Facebook profile data (rather than cookies) to measure ad performance across devices. Atlas competes against Google's (GOOG, GOOGL) DoubleClick unit, which (among other things) is a major player in the DSP space through its Bid Manager platform. Independent DSP providers Rocket Fuel (FUEL +5.1%) and Sizmek (SZMK +3.9%) are higher today.