What are the most effective ways to price ad inventory for programmatic DOOH?

1 Dynamic pricing

Dynamic pricing is a method of adjusting the price of ad inventory based on real-time demand and supply, as well as other factors such as audience data, location, time, weather, and events. Dynamic pricing allows publishers to optimize their revenue by capturing the highest value for each impression, and advertisers to bid more efficiently and strategically for the most relevant and impactful inventory. Dynamic pricing requires a sophisticated and transparent platform that can analyze and communicate data and bids across multiple channels and formats.

2 Yield management

Yield management is a strategy of maximizing the revenue from ad inventory by allocating it to the most profitable segments and channels. Yield management involves analyzing historical and forecasted data, such as fill rates, CPMs, impressions, and conversions, to determine the optimal price and inventory mix for each channel and format. Yield management also involves setting rules and priorities for different types of demand, such as direct, programmatic, or guaranteed, and adjusting them according to market conditions and performance.

3 Floor pricing

Floor pricing is a technique of setting a minimum price for ad inventory that publishers are willing to accept from programmatic buyers. Floor pricing helps publishers to protect their margins and avoid selling their inventory below its value. Floor pricing can be set at different levels, such as by channel, format, location, or audience segment, and can be adjusted dynamically based on demand and supply. Floor pricing can also be used to create price tiers or buckets for different quality levels of inventory.

4 Value-based pricing

Value-based pricing is a method of pricing ad inventory based on the value it delivers to the advertiser, rather than the cost of production or the market rate. Value-based pricing requires a deep understanding of the advertiser's goals, target audience, and expected outcomes, as well as the ability to measure and attribute the impact of the ad campaign. Value-based pricing can help publishers to differentiate their inventory and justify higher prices, and advertisers to optimize their return on investment and customer loyalty.

5 Auction models

Auction models are the mechanisms that determine how the price of ad inventory is set and how the winner of the bid is selected in a programmatic marketplace. There are different types of auction models, such as first-price, second-price, or hybrid, that have different advantages and disadvantages for publishers and advertisers. Auction models affect the bidding behavior, transparency, and efficiency of the programmatic DOOH market, and require careful consideration and experimentation to find the best fit for each scenario.

Pricing ad inventory for programmatic DOOH is not a one-size-fits-all solution, but a dynamic and flexible process that depends on various factors and objectives. By using some of the methods discussed in this article, you can find the best way to price your ad inventory for programmatic DOOH and achieve your desired results.

6 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?