Buy cheap, Buy twice when it comes to Adtech

Disintermediation is a hot topic right now. Since coming to the US I have witnessed and been shocked by the extent of it on this side of the Atlantic, far more so than in Europe. It is a trend affecting the entire media ecosystem and one which if global industry trends are anything to go by, will soon impact European advertisers in the same way.

As an advertiser it is increasingly appealing, especially within programmatic to see the ‘sell’ of a standalone DSP as attractive. Tech costs are high, so minimising service fees is an incentive. The trouble is that when cost is the driving force rather than a particular strategic play, you can be led down the wrong path. The rules have changed with the rise of ad tech. Our whole business is based more and more on data which we need to manage, explore, test and learn with. The data needs to be held by the agency running the wider business, or remain in the hands of the advertiser should they choose to take the process in-house. Either way, the advertiser retains control and has the opportunity to ‘play the field’ without too many costs being incurred.

As a company 100% focused on this space we see all of the pros and cons of the different platforms. We have a whole team, called VivaKi Verified, dedicated to analysing and evaluating the different tech offerings. This gives us an unbiased view of all of their strengths and weaknesses as well as access to every opportunity. If you think about the exclusion of Google’s DoubleClick Bid Manager (DBM) from Facebook or the fact that no DSP vendor has access to Amazon or AOP, or that Yahoo stopped selling to certain Ad networks and so on, advertisers cannot afford to tie themselves to a single player. Times change and abilities increase and decrease over time. Handcuffing yourself a single provider will therefore be to the detriment of your own ability to innovate. Analytics remains the play of the day with data insights being invaluable to deciding your strategy. Companies such as ours have a view of the whole marketplace and create understanding and analytics to inform which tech to use in which circumstances. Whether you are after pure direct response or greater data understanding, the type of inventory, access to it and historical performance are all crucial ingredients.

A single Ad tech company can only give you their view. An advertiser might be attracted to cheaper options. A siloed, third-party provider might “feel” unbiased. But what happens when the market moves (which is does every day), and that advertiser is tied to a single provider? They can only move at the speed of the provider. Or they pay a significant switching cost. Yes, DSP technology evolves. But their lack of access to the ideal marketplaces may leave an advertiser handicapped. And how will the advertiser know? It is hard to measure performance without any comparison or opportunity to swap (short of making an extensive investment).

The agency relationship should give clients cross-platform, open access to all opportunities — and objectivity. Trading desks should deliver the benefits of relationships, learnings and experience with all of the best DSPs, plus perpetual evaluations of new and evolving partners. They must be able to provide brand safety, starting with the basics like full disclosure on where ads are appearing and how much of advertiser’s budget was spent on media. The advertiser may invest substantial energy into a single provider, giving them data knowledge and insights and indeed some very valuable CRM data access. The problems arise when they decide to change providers. For this reason, it is important to know what happens to campaign performance and of course your data insights. DSPs will not necessarily let clients take all of their campaign set up and data insights with them, claiming that it is not their proprietary insight. This will most certainly affect the advertiser’s ongoing performance.

The VC-fuelled pressure cooker we are in at the moment is creating the potential for disintermediation on a grand scale. Everyone focuses on the agencies and what they lose out on, but few highlight the danger to the advertiser. There is always an opportunity cost but we know that you can often ‘buy cheap, buy twice’. The end goal for an advertiser is to either use multiple parties or at least have the infrastructure in place to make the swap easily and in a controlled fashion. The ‘all your eggs in a single basket’ approach is strewn with risk and I believe that a few of the active advertisers to date who have gone all in with one party will start to realise their mistake and push back. When they do, I believe agencies with a robust programmatic offering or an integrated trading desk will be there to pick up the pieces, and as with search back in the day, weave it back into the overall media mix.

Intrapreneurial ambition – succeeding in programmatic

Over the last four to five years I have been employing people into VivaKi and Audience On demand and have been looking for that common thread that links them all together. Is it a passion for programmatic or digital? An innate curiosity and wish to get under the bonnet of the digital ecosystem? Perhaps following the latest trends? In all honesty a combination of those characteristics and more besides. 
 
But then why not all flock to the raft of start ups that are around, bounce around a few and maybe get lucky. There is definitely a type that follow that road but there are many that want that sensation of building something, being part of an exciting growing business but within the confines of a larger organization. These people are intrapreneurs, not salary men, they still take risks. Anyone who moved into digital in 1999/2000 or earlier were all seen as signing up to lose their jobs. The calls from the TV department of will you come and fix my screen still echo to this day. Of course most are now working in digital but took years and years to make the leap. To me this makes them more cautious and not the intrapreneurs of the agency network. They are of course not the most cautious, anyone still in their same job 20 plus years later is either extremely cautious, lazy or very senior! 
 
So where does that leave the people we employ right now in programmatic. The business has evolved at such a pace, it has taken even the most forward thinking people by surprise. I already think it sounds strange when I hear ‘programmatic is growing’ it sounds so disconnected from the fact our whole business is going to be programmatic in a few short years. It also makes those who ridiculed the VivaKi Nerve Center and what we were doing with Audience On Demand look more out of touch as in a few short years they have been exposed as having little or no vision or understanding of digital. 
 
As a large employer of expertise in this area and especially as we hire more senior talent we are dealing with a new scenario. One where it becomes very difficult to answer the question ‘ what does my career path look like?’ My answer to this and one I believe fully is that I don’t have an answer. The reason for that is I believe that when you join our business things will change and keep changing. There will be opportunity all around and perhaps the least of that opportunity is me laying it out on a timeline for the next 48 months.  Instead I explain that I can’t predict exactly how things will develop but that you are in the hottest businesses in town and you are learning and developing skills that will open so many doors, to the extent that I have to admit you will eventually move on.
 
If when I signed up to be the only VivaKi Nerve Center employee and founder of Audience On demand in Europe I had asked for a nice clean career plan from Curt Hecht he would have struck me off there and then. Curt like me did not want someone who needed that, he wanted an Intrapreneur. An individual capable of replicating the same drive and passion but with support from a group and the abilities to navigate it.
 
As has been written about significantly this business of ours, has been turned upside down. Revolution not evolution is the name of the game and continues to be so every day, so anyone who wants to come in and have a nice well lit path to the CEO’s job is going to be unhappy. Whether it is Europe or US – if you work for Audience On Demand you are at the centre of the biggest thing going on in digital and will be set up for a great future – what you do now to make the most of it is important. 
 
It’s worth remembering that even in a Groupe the size of Publicis that the ability to be part of this kind of opportunity – to be intraprenurial- still exists. AOD is a fraction of the Groupe’s revenues and yet we are cited by Maurice in interviews and earnings calls. That makes it exciting. The Googles, Microsofts, Facebooks etc are the most corporate of all machines and their days of making you create something new, unless you are very senior or an engineer are done. Every day we compete with these companies and often they win by throwing money at people but feedback is often the same. It is like entering a science fiction film where you are put in a box and you need to start peddling, without the ability to change anything.
 
When I joined Zenith Media in 1996, the plan was clear, get to be CEO as quickly as possible, there was a path I could follow, others had. Now we have a world that is being rewritten and there is no clear path and opportunities and threats lie all around. Today’s successful candidates have to be open minded, they have to be flexible and adaptable. Get into the right type of business, be passionate, care about what you do and then all good things will come to you. If you want a nice secure line of sight then don’t come to programmatic because this is the fastest, most exciting ride I have been on in my career.
 
I will end by saying the true entrepreneurs amongst you, or even just those who want to keep taking risks and jumping to find a sale or IPO – keep doing it. I know many very average people who have made money by doing it.  There is no right / wrong answer in this amazing business of ours.

Foursquare / Swarm – a total car crash

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Today was the first day that I was bullied into downloading Swarm.

Foursquare has been an App that I have used for some time, it has been up and down but I decided that it will be a great digital scrap book of all the places I have visited and so use it mostly abroad. In recent months, especially with my time in New York, I have really started to appreciate the fact I can find recommended places to eat and drink. Even better I have started to see my friends and colleagues and whether they have eaten there before. Bottom line, it became so much more useful than just the checking in App.

Then comes the Swarm messages. A few weeks of warnings, every message telling me I should download Swarm because it’s great! I will love it! Well I am now witnessing one of the biggest car crashes of modern App / digital times. In fact I am flabbergasted that anyone thought this dual App approach was good. So basically my user experience today was to be forced to download Swarm. I go back to recommendations on the restaurant we had pulled up at in foursquare and then I wanted to check in, so they throw me back to swarm, I then click on user comments and I am flung back to Foursquare, who then asked me if I wanted a sneak peak at their new Foursquare lay out?! It was the worst planned process I have ever seen from a company that was relatively bedded in to the social marketplace.

The user experience is a disgrace – if you have to flip back and forth between Apps then it’s likely you only need one. Could they really not make that work? Most user backlash has focused on the fact that they search for places, find them and check in. Natural flow of events. I know the sales speak, they need to grow their user base, capitalise on their opportunity and not be hamstrung by checkins but this is not the way to do it. The reason is there are so many ways to get recommendations and by splitting those two elements you have now thrown foursquare back into the pool of competition to search for nearby places to eat. Before they were gathering a loyal base who were becoming more and more active and using both recommendations and checkins together now they just pissed them all off.

I have seen the feedback and I am yet to see anything positive. I keep reading about bravery and big changes for the better but if you have to flick multiple times between two apps, you will lose a lot of followers and Facebook will be there to clean up. I may be wrong but I will not be surprised to see checkin back within foursquare pretty quickly because today I was stung by a Swarm and feel no desire to go back to it, especially if it just fires me back to Foursquare. The only Swarm they will have are users leaving the hive.

My contribution to Wall Street Journal review of Trading Desk Strategies

A review of Agency Trading Desk strategies by Jack Marshall of CMO Today a Wall Street Journal publication, prompted by the recent Omnicom announcement that they have been in the arbitrage game all this time, and quite under the radar saw my view from Audience On Demand / VivaKi.

Click on the image below for the full story. I wanted to focus on our approach being one where we feel the advertiser needs the ATDs to be clear on charges and have their KPIs aligned with those of the advertiser.

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Financial Times: Ad fraud article and my small contribution

Solid article in the FT following up on the Fraud issues in advertising. To read the artlcle please click here. You will need to have a subscription or sign up.

My small piece focused on the issue that people talk a lot about fraud detection, as was Rocketfuel’s response, how much they detect, but the real key is to not fish in that pool of inventory in the first place.

‘Fighting fraud requires more than just developing better detection systems, says Marco Bertozzi of VivaKi, the digital ad buying division of Publicis. A big problem, he says, is that the entire advertising industry is too fixated on chasing cheap slots, even if that means “fishing in a cesspool”. Advertisers need to start looking much more closely at the quality of what they are buying, he says.’

The advertising community needs to take a stand and stop buying poor inventory under the guise of performance. Lets spell it out.

Advertiser Demand: I want cheaper CPMs and lower CPAs

Agency: Would you like to be brand safe and not risk having a Mercedes Benz issue?

Advertiser: Of course, have to be brand safe

Agency: Then I cant buy from these networks and deliver that CPM – which is it?

just a thought on..

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