Sociomantic Launches the Supply Quality Index (SQX)

Demand-side Platform Develops Algorithm to Enforce Inventory Quality in Programmatic Advertising Ecosystem

BERLIN (October 6th, 2015) — Sociomantic Labs, the leading provider of programmatic advertising solutions for enterprise advertisers, today announces the launch of the Supply Quality Index, or SQX. SQX is a proprietary algorithm that enables Sociomantic to grade programmatic inventory suppliers—ad exchanges and supply side platforms (SSPs)—based on real-time analyses of three measures: transparency, performance and inventory quality.

Sociomantic, a demand-side platform (DSP), has maintained a pure programmatic approach to media buying since placing its first real-time bid in early 2010. Since then, the DSP has connected more than 40 SSPs to its bidder, and today buys media on behalf of more than 2000 clients in more than 70 markets. Recent industry-wide concerns such as ad fraud, viewability and transparency motivated the company to develop automated mechanisms to evaluate supply quality in order to increase campaign performance and brand safety for its advertising clients.

“We have conducted in-depth data analyses to derive patterns with regards to SSP quality,” explains Alex Reinhold, Sociomantic’s head of global supply. “The observation of large fluctuations of three measures—transparency, performance and inventory quality—has led us to deploy the Supply Quality Index, an algorithm that weighs dozens of factors to dynamically assign a quality score to every SSP we work with. We factor that score into our bidding, so that we bid less for inventory from low-quality suppliers, and more for suppliers that meet our quality standards.”

Within SQX, the transparency measure consists of a range of factors that characterize whether an SSP operates as a “black-box,” or actually transmits all of the information necessary for Sociomantic to determine where an advertiser’s money goes. The performance measure detects abnormal fluctuations in prices or in the qualitative value of an ad impression being auctioned. Finally, the inventory quality measure records the actual value of inventory being sold. On the basis of these three measures, SQX assigns a supplier-specific score that is multiplied by bids placed for inventory from a given supplier.

Sociomantic clients, supply partners and publishers alike have expressed support for the company’s move to promote quality in programmatic advertising.

“Google and Sociomantic interests in promoting quality in online advertising are strongly aligned,” said Jan Wittek, head of AdX client development at Google. “Google has always invested heavily to maintain and improve transparency and inventory quality across our platforms, including the DoubleClick Ad Exchange. We’ve always taken invalid activity and ad fraud very seriously, and it’s great to see buyers like Sociomantic support industry efforts to clean up the ecosystem by enforcing ad quality from suppliers through SQX.”

“It’s our hope that SQX will incentivize SSPs and ad exchanges to act ethically and re-think their business models, putting quality over easy profits,” said Reinhold. “At the same time, publishers will gain an increased awareness about the quality of the exchanges they work with.”

Sociomantic will continuously develop SQX in an effort to guarantee access to highest-quality inventory, to improve return on investment for advertisers and to promote a more transparent industry that will benefit publishers and advertisers alike.

Additional Support for SQX

Ian Davidson, Senior Director, OpenX:
“OpenX is dedicated to driving advertiser performance by offering only the highest quality inventory. OpenX combines rigorous vetting of publisher inventory with proprietary technology that scans all exchange traffic in real time to identify and filter fraudulent ad requests. To address fraud comprehensively, we need partners like Sociomantic who will commit to not buying low-quality inventory and funding the parties who introduce fraud into programmatic advertising environments.”

David Goddard, Programmatic Trading Manager, BBC:
“We need to protect the reputation that the BBC has grown over the past 90 years in order to keep attracting the high quality audience we do today. Our users access BBC content using multiple devices, so we want to protect not only their privacy, but also safeguard the reputation of our global premium programmatic offering. As a trusted global brand, we also need to ensure that any campaigns we carry are relevant to the consumer and provide value to the advertiser. That’s why I feel that Sociomantic’s SQX is a big step in the right direction, helping advertisers find premium inventory like the BBC across the exchanges.”

Mike Klinkhammer, Managing Director, eBay:
“As one of the world’s largest programmatic publishers, eBay sees large advantages associated with the automation of media buying. At the same time, we are aware that programmatic media buying can also be associated with vast quality differences. As a result, we always maintain the highest quality standards with both media buyers and ad exchanges. It’s therefore exciting to see Sociomantic, as one of our trusted partners, share our principles and promote ethics and adherence to quality standards within the programmatic industry.”

About Sociomantic Labs

Sociomantic Labs, a dunnhumby company, provides programmatic solutions for online, mobile web and in-app display advertising. The company’s proprietary Streaming CRM technology enables the world’s leading advertisers to harness the value of CRM and other first-party data assets to deliver individually personalized, dynamic ads for the full customer journey. This results in broader reach, more new customers and increased loyalty of existing customers.

Sociomantic has been profitable since its founding in Berlin in 2009 and has grown organically to more than 250 employees serving over 70 countries across six continents today.