BertozziBytesize: Are we seeing the Demise of advertising?

First published in The Drum – click HERE

You only write these titles when you spend a few days at CES. When you return to the day job you realise that it is an impossible title. Billions of pounds of spend across too many channels you care to think of. That can’t be wrong. And it’s getting bigger almost every year.

No, advertising is not dead. But the whole point of shows like CES is to make you think differently, to look at the world through tech-tinted glasses. It forces you to listen to thousands of people who are not encumbered by the past, not designing for the here and now.

These people are concentrated on only one thing – the future. Some of them well into the future, one that has no room for presenting ads to millions of people in one go. They just don’t care about that caveman approach to advertising. They are designing a future that is built around the human being connected to everything they use and consume and who is hard wired to the world around them. As Gary Shapiro said, “the show is about moving us forward”.

There are thousands of column inches filled with articles on the tech itself, but when you take a step back and consider the connected home, the connected car, tracking devices, health and wellbeing apps, virtual reality design, we are moving more and more towards a world designed around us, around me. The space to broadcast is being reduced. Despite this, advertising today is still broadcast. Even what we call ‘targeted’ advertising is really not that targeted.

Yet simultaneously, technology is allowing us to customise our world around us. As someone who travels a lot, it is with a heavy heart that I sit through another Lebara ad while watching an in-flight film, the same one I have seen 50 times, knowing I am never going to pick up a SIM at the airport when I arrive. The likes of Facebook and Google know so much about me and yet I still see junk ads at every turn.

Our physical experiences are driving our commercial choices to the extent that advertising is being squeezed and advertisers need to evolve and integrate into a new generation of consumers.

Take the CPG category and the common fridge. Advertisers push messages telling you to fill up that fridge but the fridge is getting clever. It’s connecting to multiple data sources and information It can now keep tabs on what it has inside, making it best placed to answer your questions about what you need to buy. Now I don’t want to have my world ruled by my fridge but if I can’t remember if I need to buy milk as I stand in the supermarket aisle, then it’s the perfect opportunity for the fridge to suggest options pre-purchase based on my lifestyle.

Think buying comparison sites or TripAdvisor for all your food stuffs. LG HomeChat, for example, allows the basic part of that equation, where one can text their white goods. It’s only a matter of time before it goes that last mile. Advertisers and retailers will need to be a part of that.

The fridge is an example, but the car will be the same. Just as you are told your tyres need replacing by the man in the garage, would it not be more useful to have your car suggest which tyre you should buy and at the best price. In the case of Range Rover’s connected app which tells you your fuel range and when you need to fill up, it’s only a matter of time before it can tell you where to fill up at the cheapest price locally.

The internet of things will hold so much information that our worlds and choices within it will be determined by us and the information we hold rather than something as far reaching as the Super Bowl ad. Right now we still have a plethora of connected ecosystems (although they are being concentrated on a few big operating systems), but over time we will see our ability to combine data sources become more seamless and without the need to re-qualify as a data scientist. Merging my health data with my weekly shopping list will mean I can design my eating habits around my health and companies who integrate themselves into these ecosystems will be the winners.

The examples are endless but the trend is here, we are moving to an uber-sophisticated world of CRM but facilitated through technology and apps rather than address databases.

CES has the ability to make you rethink everything and as you see the potential personalisation opportunities of technology, and the ambition of the 200,000 start-ups that joined CES, you realise that our current day advertising looks one step ahead of cave drawings. Companies like Samsung, LG, Mercedes and Audi are all starting on that journey alongside Google with Nest and Facebook who are fully aware of the opportunity.

Ultimately we will shape our own destiny and relationship with brands over time as we continue to get closer to the images we are used to seeing in sci-fi movies.

The BIG 6 learnings from 2014 Adtech

First published in Campaignlive US – click here for article.

In a year dominated by headlines of transparency, fraud, agency trading desks and advertisers “taking it in house,” we should not lose sight of the incredible pace of acquisitions, IPOs and investments. In all these seemingly endless and haphazard investments, we have seen a few patterns form — some just starting out while others completing the circle.

Completion of the ad stack

Probably the largest amount of ground was covered here. After the first big move last year by AOL buying Adap.tv, we saw a flurry of activity. Yahoo bought BrightRoll and Flurry; Facebook bought LiveRail and relaunched Atlas. AOL, Yahoo and Facebook are all live or creating their DSPs so if you want to buy their inventory you need to use their DSP. All these moves are designed to allow the big players to compete with Google and offer a full stack to the market place. More importance is being attached to being able to demonstrate targeting abilities across channel and platform, and this is where the battlegrounds will form.

One view to rule them all

As well as the platform and infrastructure play, we have seen massive moves afoot to deliver user identification both in terms of interests and where they are consuming media. The cookie is dying, slowly, everyone can see that and the realization that owned, logged in, registered data is the new cookie. Much hand-wringing occurred when Facebook bought WhatsApp. No revenue, no ad model, what are they doing? Well one, they needed to buy up the competition as they did with Instagram, but two, it massively expands Facebook’s pool of registered, logged-in user data. Everyone now wants to create a unique set of data insights around consumers, and I am afraid that is setting us back a little: Advertisers have a right to get a single view of their customer and not be forced to work with multiple siloes.

2014 — year of video

I know, it was meant to be the year of mobile (maybe it was really), but it turned out that video stole the show. A strong IPO from TubeMogul, Videology partnering with Mediaocean and Turn launching a TV offering, BrightRoll being bought by Yahoo, LiveRail by Facebook showed just how important video has become to advertisers and media-owners alike.

If it is not the media side of it, it is the structural side: Comcast bought up Freewheel in a move sure to take it toward programmatic, and the U.K.’s Channel 4 opened up VOD to selected video DSPs. Whether it is connected, on demand or in stream, video has well and truly taken center stage. Next year is the year of mobile. Definitely. Really.

Enterprise marketing solutions look to ad tech

The likes of Oracle, IBM, Salesforce and Adobe have for years looked in the other direction when it came to media and ad tech, but 2013 and 14 have seen that change considerably. There have been some major plays this year: most notably Oracle buying BlueKai, but Adobe and Oracle have also signed major agency deals and continue to feature heavily in the discussion of merging marketing tech with ad tech.

The ups and downs of IPOs

What a year for IPOs! I think everyone was taken aback by the volume and pace of the IPOs this year. Rubicon began strongly and gave the market some confidence. TubeMogul followed, and there was talk from DataXu as well, although that has not materialized. RocketFuel and Millennial IPO’d but to less success, and they followed Tremor and others in falling dramatically from their first-day float. Some of the business models are being questioned on the basis of market position, their real added value or even whether their businesses are built on the hard and never-ending work of the bots.

Internet of things as bought by Google

From left field comes a raft of purchases that prove the tech giants are looking well beyond the banner. (That’s dead, right?) Facebook bought Oculus Rift; slow on the social-gaming ride, Facebook simply jumped one step ahead. Google has bought into Nest, the household wireless heating/ home control system. Samsung bought Smart Things, another platform for controlling the home, and finally Google bought a drone company. There were more, but you get the idea. I recommend you read the book The Circle by Dave Eggers about a social-media company that becomes part of everything in our lives and slowly erodes privacy … Then look at some of these purchases.

Marco Bertozzi is President of AOD, EMEA and North American Client Services with VivaKi.

12 Months of Adtech reviewed

In 12 months the Ad tech market place has gone totally crazy, impossible to keep track of it all and the money invested is off the scale, but below I highlighted a few stories and events in the last 11 months that I noted. I will have missed others for sure!

There has been some negativity around the space with transparency being a hot topic and whether advertisers want to take this all in house, but those headlines have distracted from some incredible market changing investments, purchases and alignments. Enjoy the reminisce!

January

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The Partridge in a Pear tree for Yahoo was Enrique Decastro, bringing him in on a huge salary and being presented as a saviour for the organisation, driving sales and value for the business. Unfortunately January saw that particular partridge being shot. Quick acting by Marissa to be fair to her, but an unlikely choice in the first place according to many. More recent news has seen Lisa Utzschneider fill that space, coming in from Amazon.

In other news Turn receive their belated Christmas present raising $80m as they march on as a leading DSP in the market and looking to expand beyond that descriptor and moving more towards a wider DMP, services model, some might call agency model.

Holy F*** February

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February was IPO crazy month with Pubmatic rumours, Rubicon filing, Rocketfuel all taking the plunge – some big valuations were banded around and it was the month everyone realised that the good times were back and the VCs were starting to spend all that cash they had been hoarding through the bad times – the bubble is inflating. Google buys another company, on the back of Deepmind in January, a London based machine learning company, called Vungle. We have seen the signs but Oracle buying Bluekai was a big flag being waved to show that the digital media business was being taken seriously by the cloud and consultancy companies. We also saw round one of TV disruption being won by the old school with Comcast getting Netflix to pay them for streaming services, the upstart being slapped into place.

But all the IPO business paled into insignificance when the world collectively went ‘what the f*** app’ as Facebook put down a multi billion dollar offer for the social messaging app. Cue the hand wringing about lack of revenue, too high a price from the digerati turned incredible commercial strategists. Facebook are clear on this, show us something growing fast and taking share and I will show you my cheque book (or should it be Visa Debit Card). Scale is everything in a world where data and the identification of people and what they are doing and where they are doing it becomes the most valuable asset. Or perhaps Mark is hoping to achieve the same status as Steve Jobs who was approved to appear on a US stamp that very same month.

Modernisation March

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March saw a number of moves for the future by different companies. Comcast bought Freewheel, a clear indication they are gearing up for a programmatic, data led future and could not resist the tide any longer. At the same time AOL One launched to much fanfare – the Game of Stacks now well underway with AOL taking a big step forward, We are but pawns in this incredible battle of supremacy between AOL, Facebook, Amazon, Twitter and Google and there is much more to go as we see this play out. The single view of the customer across screens is a vital offering and these teams are throwing everything at it, whilst Microsoft seems to be frozen to the spot at the moment. Perhaps they need to remove their whole sales team and start again? Oh..

Finally in modernisation March we saw Conde Nast take the stage and announce proudly, albeit a few years late that they had decided that yes programmatic was something to pay attention to and they would be getting involved. Thanks for that.

April Fools?

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The first signs of trouble for the IPOs of the previous months – the city falling out of love with a number of them, seeing prices fall significantly and some below opening day. There was some scepticism at IPO but recent press questioning whether these companies were right to value themselves on the hard work of bot traffic came into play. As the curtain lifts on the methods of many RTB companies this may be a theme for the future, perhaps even hitting the FT one day…oh it did.

RadiumOne saw some ‘Rocky’ waters as their CEO was eventually prosecuted for beating his wife up. It took some time and a fair amount of industry Twitter rejection to get him ousted but it happened and then everyone moved on as he set up Gravity8 three minutes later.

As if to demonstrate two different strategies Facebook and Google both made a play for the future with Facebook launching an…. Ad Network..meanwhile in other news Google bought a drone company – was it an April Fool? well after Nest in January and now a drone maker it appears not – Internet of Everything anyone?

Merger May, Maybe not

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Publicis and Omnicom call off merger. Must be something else they can buy sooner or later surely?

Millenial and Rocketfuel taking an absolute beating on the stock market as increased speculation on their businesses and whether or not they are complimentary or in conflict with agencies rage. Google and AOL keep buying companies to further enhance their operations, Google getting into attribution and AOL into cross channel allocation, interesting that both are now toe to toe on making the stack work. It was a month where everyone appeared to be tooling up with Axium buying and Liveramp to help with data onboarding.

Qriously June

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What is the worst brand name in Adtech? Qriously of course. Apparently that was not all bad and brought some pre Cannes exposure coupled with their expensive tablet card asking for a meeting. Memorable but expensive I would say, some might say a qrious decision.

June was the month GroupM announced a withdrawl from open exchanges and that it would be done by Christmas, big claim for sure. Could someone check for me? pretty sure they are still there but there is still time.  As with every year Cannes came around and the Adtech world took it by storm – the rose looked and tasted the same, the beaches were packed with hard working media folk but the names were different, everyone had upgraded this year and the place now resembled an Exchangewire event at scale. It was a good time to be in Cannes as the money continued to flow and pay for those expensive tents and lunches. Mediamath picked up a massive 170m dollars, Twitter bought Tap commerce for 100m, Facebook bought slingshot and WPP ploughed 25m into a DMP strategy.

Buy buy July

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Enough said, the boom continued and at pace. Facebook buys Liverail as its next move in Stack Wars, Yahoo buys Flurry to continue its successful push into mobile revenues, a battle it appears to be winning as we are seeing now as it overtakes Twitter in mobile revenues. Linkedin bought Bizo, a natural fit for both and makes us wonder if the sleeping giant is starting to wake up and join the fight.

Rocketfuel bought the very transparent X+1 as it starts the long road away from the darkness and into the incredibly difficult world of running a business transparently. In the spirit of transparency Turn took a turn in July and went on the offensive, taking aim at Tubemogul amongst others, it felt like an email you send late at night when slightly under the influence  – stand away from the send button. Oh no, you did again..in August.

August.

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Everyone went to the beach. Google bought some more companies.

Facebook me September!

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Millenial fights back and buys Nexage to grow out its programmatic credentials and build credibility in the data and RTB space. At the same time WPP drop their adserving business and buy into the DSP business, out with the old in with the new.

The Alibaba IPO put Yahoo into a very interesting position, as perhaps a buyer or maybe a seller? There is a strong belief that Yahoo and AOL are on a collision course and so having their P&L filled to the rafters with the Alibaba IPO cash will put them in a great position either way.

But really all everyone wanted to talk about was Atlas and the launch of their new adserving platform and soon to be launched DSP. Facebook had now made its biggest move in the Stack wars. Combining improved adserving tech with their data and soon to be launched DSP. With this move we see ever more clearly that there are likely to be some large islands of tech and everyone of those is ring fencing owned and operated inventory and how you access it. We have moved a long way from the utopia of one access point to the web and are now focused on how can we join these islands up with DMP and other technology.

Hotober

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Publicis buys RUN and invests in Matomy – something to expect as we progress and competition comes not just from other agency groups but also the very aggressive managed service offerings and RTB networks. Agency groups will need to tool up more and more and so I think we can expect more down the road. Mediamath go to prove the point and buy Upcast showing how they need to tool up as well and keep delivering new products and services cross channel and cross device. Meanwhile Videology launch a programmatic TV offering to follow Turn but go a step further in teaming up with major US TV partner.

Stack Wars is back in October with Yahoo buying Brightroll, a sensible move as you consider the purchase of Adapt by AOL and Facebook of Liverail a couple of months earlier. We now see them all with video offerings, display offerings, adserving and performance products and suites of data.  I think we are about at the right time to see them kick off. Atlas has hired a key guy in Damian Burns to lead their offering, once he has his feet under the table I think we will see some real movement.

Noooo!vember

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Headlines were:

Publics buys Sapient a huge acquisition and another one under the radar taking the advertising world by storm. An incredible team of people joining the Publicis.Sapient platform.

Channel 4 after years of resistance to programmatic have announced they are getting into the market place and will no doubt leave ITV where to go next. Either way it is clear the TV marketplace is hotting up and now we are seeing a hockey stick of activity and partnerships. Exciting times all around.

Rubicon buys two companies to help build out its direct deal automation tech..yawn. Yes you got it, we are going to take all those buys you used to do over the phone and now do it on a platform without any cherry picking or data insights. Just back to buying impressions. Back to the future.

I am sure I missed a number of big deals – list them below so we get the full picture of the comings and goings of Adtech and its sheer scale. Thanks

 

 

 

 

Technology : Blurring work and home life

I am sure there is a name for us, those people who have traversed the pre and post Internet eras. It is with great amusement that I see the reactions of young people in my business when I tell them that when I started out in my career there was no internet or email. It is quite something that in my career of 18 years we have gone from no internet or email at work and lets face it limited mobile phone usage to the Apple watch.

So what impact has that had on our lives? We have imperceptibly been on a technology creep around work that has blurred the lines between work and home, work and family and without being able to identify when or how it started. It got me thinking about the new starters who are immediately looking to get a phone or blackberry/iPhone and how that is probably where it all started – status. It started with status and the attainment of that position coming with a phone (no email) and or laptop which of course has now moved towards almost universal connectivity for all.

Even when we had blackberries there appeared to still be boundaries around holidays and out of hours, there was a start and finish to the day but that has disappeared now. We are all working night and day now, we work as our children swing or slide, we work as we take that long drive or wait at the airport to go on holiday. Emails come and go at all hours, and the all hours really does become all hours as we work in an ever more global marketplace. Our colleagues scattered all over the world each either at work or at home, sending that odd email. So that got me thinking about whether we are all living far more stressful lives than those of the 80s or the 90s. No escape, no off switch. When you went on holiday back then, that was it, you were off, and you could relax, no expectation, no ‘could you just join this call’ you were OUT. Weekends were weekends, as you got on the train or jumped in the car that closed the shute and gave you a chance to reflect and consider the week that was and the week to come.

The impact is worse than that though, what impact at home? How much more is the family affected by this than you – how many times are you zoning out of the present to read, respond to a message – did it annoy you and change your mood. How many times did you hear ‘Daaaad?’ ‘come on dad’ because you were distracted. None of this happened before the technology, we were all present, in the moment. Technology creep has eroded into home life, friend life. We have become a nation of screen starers and we all know it, but can’t stop it.

But hold on, is it all bad? As someone who travels a lot technology has helped me, it has kept me connected to my family more than I could ever have done before. Now I can see and talk to my wife and son when I am away, I am able to send photos and videos at the touch of a button. I can work instead of killing time at airports – I can keep working wherever I am instead of it all piling up for my return and perhaps making me go into the office at the weekend. The ability to work remotely is also a new opportunity for the modern businessman. But here in lies the problem and the reason we can’t stop. We can work everywhere and ‘spread out the work’ so as to minimise home disruption. We now only need to glance at our phones every half an hour rather than take a full two hours out of the day, but I think that is more corrosive than locking yourself away for an hour.

So where does that leave us in this constant battle with technology – it starts with us. It starts with the standards we set for each other and what our expectations are of each other. I have three rules, one for me and two for people who work for me that I try to stick to at all times unless there is something extraordinary. The first is that when someone is on holiday, let them have that time uninterrupted. Don’t tempt them in, don’t encourage communication. The second is to not expect communication at the weekends (I fail a little at this by emailing at weekends but I don’t expect responses) The third is for me, it is not new but I do believe in it, if you have a stressful job then don’t look at your email when you first wake up, in fact give yourself a chance to wake, dress, eat, speak before being pulled into email because you don’t know what you will find there and it is proven to increase stress levels overall if it starts first thing in the morning.

We cant stop the technology creep, we can only become more disciplined with it and I will be looking to improve myself for the sake of home and family.

CampaignLive US article on Advertisers missing the prize of programmatic

My piece in CampaignLive publication in the US – to see click here

How did it come to this? You can’t mention programmatic without talk about transparency, trading desks and advertisers taking it “in-house.” A part of me that would likely get fired says “Go on, then” because it will mean that advertisers spend considerable time understanding the space, in order to appreciate what is required to do this well. They will also be doing the right thing with their media — I don’t mean taking it in-house, but rather the likely improvement in execution and management of their media using the latest technology.

While in-house has been a hot topic this year, all we have right now is a lot of noise. Companies stirring up the ecosystem trying to make hay while the sun shines and consultants with minimal experience in this complex space suddenly getting the light of day. It is a real shame. I spend so much time talking fees and transparency with advertisers and so little on strategy that I truly believe they are missing the chance to make the most of this incredible opportunity.

Advertisers setting up their own programmatic operations is as sensible as Google deciding to set up an agency business and go direct to clients. “They do that,” I hear you cry! Not really. They chase revenue, and if they see that being taken by competitors they step in. Google also has tens of thousands of free sales people — they are called agencies. Clever businesses stick to what they do best. Even brands that have been working away at this for some years are still struggling to keep up.

I recently read that taking it in house was expensive upfront but you get payback over years. I have never read such incredibly ill-informed, ill-thought rhetoric in all my life. It infers that programmatic expertise in agencies after the first couple of years runs on nothing. The reality is people need paying; tech companies need paying; innovation needs to evolve. Nothing goes away after initial set up; it only grows. It is this kind of crazy talk that is distracting advertisers.

Let’s start with talent. Programmatic now commands some of the highest salaries and brightest brains. This creates multiple challenges for employers — motivation, retention and a lack of insights from outside the immediate business. Technology evaluation skill sets, data analytics and audience insights knowledge, data warehousing, contract negotiations, legal, creative, partner management – these all are essential for a successful programmatic business. Spare a thought for the team doing it in-house — two, perhaps three people. They will not be immune from the same standards agencies have. Brand safety is still brand safety. The CEO will be no less unhappy when the Wall Street Journal reports a fraud blow up and an in-house team has been managing it. The same effort needs to be applied in or out of the house and that costs money.

Why would an advertiser want to take that on? Because they are unhappy with transparency? Because tech fees are high and they want to find ways of saving? It is a false economy. “Buy cheap, buy twice” is a phrase I am a firm believer in.

The companies who have managed to do this well are few and often pure-play digital, online businesses with very specific KPIs that are easily tracked and measured and with a culture of digital innovation. Netflix is one example. Moneysupermarket in the U.K., another. Almost all, including the most famously quoted however, are relying on third parties to do the work. That is not taking it in-house, it’s just not using an agency. And they are right not to, but if a little less time was spent on the angst of transparency and fees (easily solved by talking with your agency operation) and more time on the strategy, then the fees will make sense. More time also needs to be spent talking about the amazing case studies of clients that have embraced this space and are turning their media investment around – there are many.

Advertisers who empower their agencies in the programmatic space and invest the time to really partner with them will dramatically change how they do business and the results they achieve.

As a final note on this, While hundreds of millions of advertiser dollars are spent on blind, low-CPM, long-tail ad networks that are taking 60 percent margin, I find it very difficult to believe that an advertiser is achieving the most they can from programmatic or indeed asking the right questions about their media investment, whether that is taking it in-house or not.

Marco Bertozzi is VivaKi’s President, North America Client Services and Audience on Demand EMEA.

Read more at http://www.campaignlive.com/article/programmatic-taking-in-house/1317802#Rwl3QzVofffQABqe.99