The adtech industry is generating plenty of buzz and making big forward strides as of late. For example, the programmatic advertising sector was set to bring in more than $46 billion last year, and by 2020, 86 percent of all digital display ads will be bought via automated channels.

Currently dominated by tech giants Google and Facebook, the adtech space might soon see some retail behemoths enter its top ranks. Amazon already brings in significant revenue from its adtech services, and Walmart recently announced it will consolidate advertising sales for its stores and websites. Both companies’ adtech efforts introduce new competition in a digital ad space dominated by two companies.

As the adtech playing field slowly expands, it could inspire other companies — especially smaller ones — to break into the space. However, many smaller companies seeking large-scale adtech success don’t possess the digital edge needed to capture significant market share, especially as they struggle against notorious barriers within the adtech space, such as fraud, duplication and high latency.

Any newcomer would love the opportunity to compete with adtech leaders such as Amazon, Google and Facebook. So what adtech pitfalls should they be on the lookout for and how can they scale those barriers on the way to success?

Creating competition in adtech

Newer adtech players like Amazon and Walmart — giants in their own right — have access to robust tech resources that allow them to glean actionable insights from massive data sets, driving notable bottom-line results.

Amazon, for example, has found significant monetary success in adtech. It’s unclear exactly how much of Amazon’s overall revenue comes from its advertising efforts, but we do know its adtech income makes up most of its “other” category on its earnings statement. For 2018, it’s “other” category was on pace to hit $10 billion — more than double 2017’s income for the same category.

Walmart has recently launched its own initiatives for stepping up its adtech game. It decided to take its digital advertising needs in-house and away from an agency partner. By creating its own digital marketplace, it hopes that brands will view Walmart as a trustworthy network to do business with, especially given the store-based ad data at its disposal.

Walmart and Amazon’s entrance into the upper echelon of adtech is a positive step for the whole marketing industry. We want to see more of this for the sake of competition, but the tech element can be tough for smaller players to nail down in order to start ascending the ranks. For example, here are some common barriers newcomers to adtech tend to face:

  • Fraud – Brand safety has been a hot topic in the ad space after controversies involving YouTube and Google ad placement. Out of fear of putting their brand in danger due to poor programmatic placement, advertisers are beginning to prefer one-to-one setups to ensure transparency and access to fraud-free publishers for their ads.

  • Duplication – One impression opportunity often registers as multiple bid requests within the demand side platform (DSP). With more requests than necessary for the DSP to process, this hiccup slows down the bidding process and puts strain on the DSP hardware costs. For the smoothest experience possible, emerging adtech providers must be able to work on a platform that solves for the issue of duplicate bid requests.

  • High latency – Programmatic ad sales must happen fast, and falling short of an adequate real-time bidding (RTB) speed could mean losing out on coveted bids and ad space. A lack of low latency also leads to shoddy data through unoptimized bids, under- or overvalued impressions, and suboptimal targeting.

To scale each of these hurdles, emerging adtech vendors should turn to a managed adtech solution. The right solution enables the needed agility and scalability for adtech’s ever-changing landscape. Its interconnection abilities should allow providers to connect to leading digital ad partners, bypassing the heavy traffic and risks on the public internet to provide a higher-quality inventory and drive revenue. Your partner should allow you to exchange data and conduct transactions as fast as possible by reducing latency to single-digit milliseconds.

Adtech is no longer a walled garden, and customers stand to benefit. Market competition leads to better services and more accessible pricing, opening up the door for more brands to convert and become customers of an important marketing service. But new adtech providers’ struggles to sharpen their digital edge boxes many of them out from a chance to rise to the top. However, by trusting in a partner platform to build their solution upon, up-and-coming adtech stars can overcome common industry hurdles on the way to programmatic success.

About the Author: Scott Walker is the CMO at Unitas Global.