You don’t often see companies throw a massive chunk of their inventory out the window. Well, yes, there is Ford, which decided to discontinue almost every traditional car it made in North America, but I guess you can afford to if you’re also making the best-selling vehicle in the world.
Back to the AdTech industry, though. Zeropark wouldn’t be where it is right now, if it wasn’t for a major traffic cleanup back in 2017.
We considered it a bold move, as the first thing that springs to mind if you think about a traffic network’s inventory is probably loads of traffic. Yet, we decided to cut more than three quarters of our traffic.
After Zeropark had established its position in the market, we started to rapidly increase our inventory, getting more and more publishers and traffic sources onboard.
Right before the cleanup, we had been fluctuating between 400 and 500 billion available ad impressions per month. In peak times, our QPS (Queries Per Second) stood at nearly 500K—that’s 500,000 ad requests per second! Sounds great, right? Truth be told, it was more than we could even monetize.
Having these insanely high volumes of traffic changed the characteristics of our platform in a way we didn’t necessarily appreciate. When advertisers ran their Run-of-Network (RON) campaigns, their results were often times subpar. The source of the problem laid in the quality of the traffic.
A large part of the traffic was, simply put, junk. This part was making it hard for advertisers to optimize their campaigns. Traffic networks back then were a mess, buying and selling the same visitor over and over again.
Additionally, many advertisers failed to recognize the issue with the modest bids they were setting, as long as they were winning the biddings. Unfortunately, as the traffic quality at these low bids left a lot to be desired, it only led to purchasing traffic that wouldn’t bring them a reasonable number of conversions.
Seeing all this made us bring out the brooms.
We kicked things off with a research on our customers’ needs.
Hours of conversations with advertisers confirmed our expectations. Quality is valued over volume.
So, in May 2017, we proceeded with a major inventory cleanup.
In this five-month process, we were benchmarking each traffic source, checking the cost and conversion rate, as well as analyzing the source itself, to find out what kind of publisher profile we were dealing with.
Whenever we found out that the source’s performance was unacceptable or showed signs of fraud, we terminated the relationship straightaway. In cases of doubtful, unstable or unproven performance, we’d further monitor the traffic to see whether it would improve. If it continued its unsatisfying level of production, we showed no mercy.
In order to benchmark the traffic and monitor its performance, Zeropark introduced its clients to traffic segmentation and tiers.
The default bucket is called Standard Traffic. This provides traffic with stable performance, yet lower than the Premium Traffic bucket, which has a proven track of conversions and comes from trusted and well-known sources.
Lastly, the unsold traffic that seems unstable and tough to classify, being kind of a wildcard when it comes to conversions, gets thrown to the Remnant Trafficbucket, which provides impressions at a flat price.
So how do the traffic segments stack up against each other in terms of conversion rate? Check the graph below:
Additionally, we created traffic tiers, preventing the advertisers from burning out their budgets on low CPM countries in multigeo campaigns. With each country being assigned to one of three tiers, it’s easier to set up optimal bids for RON campaigns.
Let’s get straight to the point.
- As a result of the five-month cleanup, we got rid of more than 75% of our entire inventory, effectively increasing the quality of traffic in Zeropark.
- The average CPM rate increased from around $0.60 to nearly $1, and even with the increase in advertising costs, campaign profitability has grown as well.
- Comparing the average ROI% for Q1 of 2017 (pre-cleanup) with a post-cleanup rate for Q4 of 2017 shows an increase from a 55% to a 73% level—a proof of significant increase in traffic quality.
- Better understanding of traffic quality (brought by traffic segmentation) helped advertisers improve their control over the entire campaign flow. This meant not just higher conversion rates, but an efficiency boost too.
- The average conversion ratio has increased from 0.19% before the cleanup to 0.86% now.
Still, we noticed that advertisers, being afraid of burning off their budgets in no time, were skeptical about the Premium bucket. But this skepticism was unfounded, as the Premium bucket consists only of proven traffic that converts at a significantly higher ratio (as you saw in the first graph). So you can be almost certain that if a Premium campaign isn’t converting, the offer is to blame.
It’s important to remember that low bids aren’t likely to bring high quality traffic to your campaigns, and you may find yourself buying visits that aren’t bringing a satisfying return on investment.
The Great Achievement
Our goals with the cleanup involved an increase in positive feedback about the traffic quality from advertisers, benchmarking and segmentation of the traffic, and ultimately more conversions brought to Zeropark users.
But during the process, we were able to accomplish one more important thing: our own anti-fraud solution.
Since we had so much traffic, we had to awaken the little scientists in us, and use this huge sample as a research material.
We created a dedicated team for the purpose of analyzing each traffic source and its behavior. We have also started using third-party web analytics tools to monitor fraudulent actions. Consequently, we were able to develop a set of filters to prevent ad fraud.
So today, we still leverage this three-way approach to detect invalid traffic, giving you a guarantee of running fraud-free campaigns with Zeropark and investigating any case you may find suspicious.
Getting rid of about three-quarters of our inventory helped us better serve our customers’ needs. From selling a lot, we moved to selling smart.
In April 2017 we had 416 billion available bid requests. Just a year later, this number dropped to 95 billion, but the average CPM increased by approximately 60%. More importantly for the advertisers, the average CR% rose from 0.13% to 0.83%. That’s a sixfold increase in conversion ratio!
Our traffic is now way more reliable and effective, as it comes only from performing sources. Traffic segmentation has become something neither us, nor our customers, could imagine Zeropark without. And finally, with the cleanup we were able to develop our own highly efficient anti-fraud solutions.
So let this be a lesson for you—taking a few steps back can actually push your business forward.
Posted by Bartosz Bielecki