Principal-Based Buying by Trading Desks Raises Transparency Questions
· 2h ago · Originally reported by Agency Reporter
Principal-based buying refers to trading desks purchasing ad inventory as a principal, then reselling it to clients. This model can obscure how much inventory actually costs and what fees are added, making transparency a concern for advertisers.
Why it matters
Understanding principal-based buying is important because it affects how advertisers see costs and value in programmatic ad buying, potentially impacting trust and budget decisions.
Explain it like I’m new here
It's like a store buying candy in bulk, then selling it to you without telling you how much they paid, so you don't know if you're getting a good deal.
Read the original at Agency Reporter
Terms in this story
Principal-based buying
Principal-based buying is when an agency buys media for its own account and resells it to clients at a price it sets, instead of buying at cost as the client's agent.
Trading desk
A trading desk is a specialist team, usually inside an agency or advertiser, that plans and executes programmatic buying on DSPs on behalf of campaigns and clients.
Ad inventory
Ad inventory is the total amount of advertising space a publisher has available to sell, usually counted in impressions across its ad slots, pages, apps or screens.
Advertiser
An advertiser is the company, organisation or person that pays to place ads in order to sell products, build a brand, recruit, or spread a message.
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