The Trade Desk unveils ‘Solimar’ release to improve advertisers’ goal setting

Advertisers aren't always setting the best goals when they place ads, and The Trade Desk, which has built a $1.5 billion business helping them place ads, wants to now help them better shape how they use the tools.

That is one way to look at Solimar, a new release of The Trade Desk's ad-buying tools that is being formally unveiled Wednesday at a New York event featuring the company's CEO and co-founder, Jeff Green.

"It's about a better conversation with clients about what they want to achieve in the platform," said Mark Davenport, the company's head of data science, in an interview with ZDNet via Zoom.

"We noticed as the platform grew in complexity, clients would stumble into traps when setting up campaigns," said Davenport.

One example is over-paying in a what's called a second-priced auction for advertising. 

"With second-price auctions, it used to be you could bid super-aggressive" but end up paying a lower actual price when one won the auction. "With first-price [auctions], that goes away, and so clients were bidding super aggressive and paying super high CPMs." Think of it as buyers' remorse. 

To solve that, The Trade Desk used a data science toolkit if developed called KOA that makes possible "predictive clearing." In predictive clearing, "we try to take the bid and reduce the bid such that we are not reducing the chances of winning" but still minimizing what an advertiser will end up paying. 

The Trade Desk gave the example of a "leading entertainment company" that was able to reduce its CPM, the average price it pays, by 53% across the many advertising venues in which it placed. On average, The Trade Desk clients have seen reductions of 15% to 20% in CPM with predictive clearing, the company says.

Predictive clearing is an example of a capability that was already in The Trade Desk's software, but that customers did not activate, often because they didn't even know it existed. "They just didn't see that check box" in many cases, Davenport said. Solimar brings greater clarity to such capabilities, he said.

Solimar is also the first time that clients can set multiple goals by which to optimize an ad-buying campaign. "We are going to invest more in our support of multiple KPIs," said Davenport, meaning, key performance indicators.

"At the most basic level want to get propel thinking about meaningful goals," said Davenport.

The company noticed that some advertisers might run through a budget so as simply to spend money, without attention to what the actual return on investment should be for that spend. "With this release we are trying to make it easier for our clients to measure their core objectives," said Davenport. 

Part of that is the company's measurement marketplace, as it calls it, a way to obtain plug-in capabilities from a variety of third parties including Oracle, LiveRamp, DoubleVerify and many others.

"With this release, we're focusing on achieving the right goal for the right client," said Davenport. "Whatever the business objective, we want to be able to support that."

Asked what would be next after Solimar, Davenport told ZDNet the work going forward is about making sure The Trade Desk lives up to what it has set in motion. 

"In some ways, the work really starts now; now, we can't hide anything in the platform from what we are performing," he said. "We are making it really easy for clients to see, are you really hitting your goal with The Trade Desk or are you not."

Separately, The Trade Desk announced Wednesday it has begun a venture capital arm, TD7, which will make investments in promosing startups in the advertising area. The first investment placed is Chalice, which is developing technology for algorithmic ad buying. 

The Trade Desk declined to provide the size of the venture fund.

You can sign up to attend the live stream of the Solimar event from The Trade Desk's Web site.