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2.5 Minute Read

What Actually Happens When You Try To Reach Your Target Online

Here's what actually happens in advertising on the open web and Connected TV in the milliseconds when your target shows up online:

🔱 An Auction Begins: When your target visits Politico, an auction for that ad space launches instantly.

🔱 Competitors Flood In: Hundreds of advertisers—from Fortune 500s, to other advocacy groups, to consumer brands—all want that ad impression.

🔱 Dynamic Bidding Wins: Smart advertisers use AI-driven algorithms that adjust bids in real-time based on how valuable the target is to them, and how much they need to pay to win the auction. If a dynamic bidder can win the auction below the fixed price competition, they do so, and save money for more ad impressions later. If the dynamic bidder needs to pay more than the fixed price bidder, they do so, even in increments of pennies to win the battle for the audience's attention.

🔱 Fixed Prices Lose: Your fixed bid of $15 CPM (price per thousand impressions) gets beat by someone willing to pay even $15.01 for that specific target's attention.

🔱 The Winner's Ad Appears on the Target's Screen:  This entire auction—from page load to ad display—happens in under 100 milliseconds. This is of course absolutely BONKERS, but it is also the foundation of modern online advertising.

Why This Mistake Is Devastating In Public Affairs

In voter or consumer advertising, if you miss one target, there are hundreds of thousands, or even millions more. But in public affairs:

🔱 Your Targets are Irreplaceable: There's only one Speaker, one Committee Chair, just a few swing votes. If you lose them, you can't replace them. So why would you be willing to lose an auction to someone trying to sell your irreplaceable targets insurance, or anything else for that matter? Many public affairs campaigns carry over the fixed price concept from voter and consumer advertising, but voters and consumers can be replaced. Decision-makers can not. 

🔱 The Competition is Fierce: Everyone from Big Tech to Big Pharma wants those same eyeballs you're bidding on. If you set a ceiling on what you're willing to pay, you will lose.

🔱 The Stakes are Astronomical: If a consumer campaign misses their denim sales target, they'll get another chance tomorrow. But you won't get another chance tomorrow at the one key vote you're advocating on.

The Hidden Cost of "Saving Money" with Fixed Prices

Consider this real-world scenario:

🔱 Your fixed price for ads is $25 CPM.

🔱 The clearing price at 9am for your decision-maker is $15.

🔱 The clearing price for that same decision-maker checking news at lunch is $75.

With fixed pricing, you overpaid in the morning (costing you the chance to deliver your message more times) and you got completely shut out at lunch. 

So the next time you see a quote for a fixed price for a public affairs ad, ask yourself two questions:

(1) Are you willing to lose to someone else who is willing to pay even a penny more than you?

(2) Are you willing to overpay when you could instead use that money to deliver multiple messages to your audience?

Three Ways To Operationalize This Email

🔱 Check the pricing structure on your public affairs ads: Are you using dynamic bidding or fixed price bidding?

🔱 If you're using fixed price bidding, check how many times you have actually delivered your messages to your precise targets.

🔱 If you're using dynamic bidding, check your win rates. How often are you winning the auctions, and do you need to make adjustments to your bidding strategies?

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