Tag Archives: ad exchanges

Wall Street Journal blog – In Defence of Trading Desks

This post was first published in the Wall Street Journal – to see it click here


In Defence of Trading Desks

The World Federation of Advertisers report on programmatic trading, issued last week, has set the online ad industry abuzz. I am pleased to see clients taking a stand on transparency and some of the other issues surfaced in the report, despite being one of the purported programmatic culprits.

When Publicis launched Audience On Demand in 2008, we decided to create it as an alternative to the very murky services that were dominating the marketplace at the time, such as ad networks, that operated in the dark and sometimes pocketed triple digit profit margins in the process.

Six years later we are standing firm on our early decisions, and reports like the one issued last week suggest the market is moving in our favor.

But the fact is not all agency trading desks are created equal. And while the WFA report inaccurately tries to paint us all with one color, I encourage every marketer in the industry to take note of the questions in the report that relate to issues such as arbitrage and data. Don’t just ask these questions of your agency trading desk, however; Ask them of every programmatic provider you might be spending with today.

If a programmatic provider is working in a marketers’ best interest it should not be arbitraging inventory, it should be buying audiences and inventory transparently in real time. It should be protecting marketers’ data (it’s their data, and they should honor it as such, unless given permission to blend it). It should have a rigorous vetting process to evaluate all data and technology partners to be sure that protection extends across the ecosystem.

It should also be tireless in pursuit of viewability and quality, and it should show you how it is trying to protect your ads from fraud. I submit that an in-house option or managed service demand-side platform that buys on a marketer’s behalf will provide less brand safety than an agency trading desk. It simply costs too much to deliver extensive black and white lists, tech vetting and human vetting at a client level.

Finally programmatic providers should make it entirely clear what percentage of marketers’ ad dollars are actually spent on ad space, and it should be far, far greater than 40% as the WFA report suggested. That number is ridiculous. Candidly, a fair amount of the math cited in the WFA report is peculiar.

In general, the WFA report steers marketers toward setting up an in-house solution. It’s a viable, though difficult and limiting proposition to pursue. An in-house operation is not going to resolve all transparency issues. It might give marketers complete control, but it also results in limited visibility once the campaigns go out the door, and you are only as good as the technology you tie yourself to.

Meanwhile, if marketers outsource to an ad network, managed service DSP or non-disclosed trading desk, you have little control, less visibility and no ownership.

I hope I get a chance to meet the WFA. I would love to talk to authors of this report about their findings, where the insights were obtained and how the calculations were done. So much of the report is spot on in terms of what questions to ask, but the bias and inaccuracies need to be corrected.

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A week at The VivaKi Nerve Center

A week at The Vivaki Nerve Center


An early meeting with the WW CEO of ZenithOptimedia to discuss how the market is shaping up and what can be expected of 2012. As the conference season starts I am being pulled in a number of directions to make sure everyone who needs the latest info has it!

Later that morning a call with the boss, Curt Hecht, it’s a about planning stage and we discuss what we need to get done for 2012 and how we will work with the agencies. A lot of progress in 2011 for VivaKi and The VivaKi Nerve Center and so it makes for some great conversations for next year. More than ever we will be a very European organisation which is achievement in itself. a series of meetings with the major EMEA markets all to be planned.

A session on contracts, which seems to take up a lot of time at the moment, but we are making real progress with a number of contracts signed that will help power The Pool, Partnerships and AOD.

End the day back at the WW CEO’s office to finalise some notes for the conference and its my turn to start to prepare for the Exchangewire ATS event where I am on a panel with Nigel Gilbert from Orange, Gurman from MediaIQ, Breadon from AOL, Martin from infectious and hosted by Zuzanna at Microsoft. Will be a good day I am sure.

In the evening, I went to the Appnexus / Microsoft drinks and met with the founder of Appnexus, the new head of Microsoft, Andy Hart and a number of others. Bumped into Jakob of GroupM, always a pleasure and we had a little catch up and then I had to leave for dinner with Quantcast and Exchangewire down at BerryBros.

As usual you learn something on these nights and having spoken to a number of people from other groups, its clear to me that VivaKi are the most integrated and aligned group in this space, working hand and glove with the agencies. I hope over time this pays dividends for us all.

Tuesday – ATS Day

Arriving at the event really makes you see how far things have moved on in the last year. Ciaran’s first one was a big event but this really surpassed itself with 400+ guests. Unfortunately as the day went on it became clear that again it lacked publishers and advertisers. The more I think about this though, the more I think, why should they be there?

Morning sessions were OK but lacked direction, more moderation, different questioners and less keynotes would have improved the morning session. Keynotes fund these events but I feel having Mediamath and Rubicon and Appnexus all doing a turn is perhaps excessive.

Microsoft did a great session, slick presentation and I think surprised everyone, he even presented an Apple Ad, which was the talk of the Twittersphere..

The afternoon panel I was on was billed to be controversial, I knew it would not be, for two reasons. The first is we have said this before and the second is that people in the audience don’t want to stand out and make issues. The bigger these events become the more polite they will become. I had a couple of key themes I wanted to get across around the whole Ad Trading Desks.

1. We are not an Ad Network
2. We will cut back on Ad Network spend
3. We will be aiming to centralise all retargeting and we think it’s the right thing to do
4. We work with a number of DSPs just not in the UK and we know what is what

I made all of these statements as well as suggesting Ad Nets use client data across their campaigns and received no resistance so, if it was not controversial, it was not because of me! Feedback has been that it was too about positioning of each others company etc but you go where the questions take you.

All in all though, a good day, got to catch up with some great people from around the business and generally enjoyed it all.


We march on with an exciting morning meeting with a large European company that is soon to become Vivak’s first VNC Partner in EMEA. We have of course high profile relations with Microsoft and Google as well as other US companies, but this is the first at scale. We worked through the opportunities, what we need to do together and how we can help each other, a great start to Wednesday and we look forward to releasing that news soon.

Later that day, I 100% focused on The Pool. We have been delayed on this but we are ready to go again, very exciting, there is other info on The Pool elsewhere on my blog Later this year I am presenting at the IAB conference on Spain the results of the Spanish Lane and some of the work that’s been going on in the US, I am really excited about the results that have come from this work.

We have three great publisher partners and already two major clients so things are looking great in that regard, there will be more to come on that subject shortly.

The day ends meeting a team of senior Google Product managers who are trying to work with us to provide insight to power Audience On Demand. It’s these meetings that the Google partnership is founded on, not media spend and discounts. It was a really interesting session and we learned alot about what is coming up. Invite will be a very powerful proposition.


A quieter day on the meetings and valuable time to catch up. I did meet up with the CEO of Vindico and team who have big ambitions in the UK. We work with them on The Pool and they are a great outfit. Its time we need to get over the control issue around video adserving, we have been through this once with display and its time we moved on when it comes to video. We are used to substandard, early 2000 type tracking and reporting which is not acceptable.


A chance to discuss everything we have been doing and seeing this week. A morning appointment with a client with a brief to talk them through all the things The Vivaki Nerve Center are working on, went brilliantly and we will be doing some great work I hope. They showed the kind of interest in innovation that makes it all worth while.

A run for the train from glamorous Slough with just enough time to read the placard under the stuffed dog at the station and down to Microsoft to present to their regional scale display teams and talk about the importance of agency trading desks. Quite a turn out and some great questions from the group, I hope we can act on some of the discussions and continue to grow our global partnership.

I end the week with some time to keep up momentum with The Pool, discuss with thepaulsilver the final touches of an exciting launch next week and what I am going to do when he is on holiday!

Trading Desks are in for the long haul, not the sale.

I cant decide where to start on this post, there has been so much going on in the hectic world of ad exchanges in the last few weeks. Top of the bill was an excitable debate between an Audience on Demand employee and a disgruntled DSP. The key issues raised around conflict of interest included agencies being forced to put spend through their trading desks, lack of impartiality etc etc.

Interwoven with this debate was the fact that so many companies are approaching us at the moment, DSPs, Data targeting companies etc all with interesting premises I suppose but all with one thing in common, they all need to make as much money as possible, as fast as possible. Lets talk about conflict of interest..I use the DSP marketplace including Triggit which was involved in the above debate. How many shall we say there are, that are currently aiming for Trading Desk revenues – 4? 5?. Everyone is coming to town, everyone wants a piece of the action, but when they get into town they realise that a couple of those 4/5 have been busy for a few months / years and pretty much wrapped up the business. Its not to say thatagency groups will not test and learn, we do in the US and there is definatley room for more than one or two but for some, the market’s not big enough. What happens then? They need to fight for revenues, they need to say why they are better than each other and especially better than Invite to try and find the big ticket, except I am not sure there is a big ticket at the moment. So then they resort to the last option which is to try and undermine the credibility of a trading desk to try and open up some cracks of opportunity.

The conflict of interest for those guys is they have to make money to keep the VCs happy. The agency group trading desk model is not in the same boat. Audience on Demand’s sole purpose in life is to navigate on behalf of its clients a very complex market place and deliver great results. They are in it for the long haul, they have much more to lose. AOD messes up on a client it can jeopardise the whole business. Yes there is pressure to deliver..but its to deliver results not revenue first and foremost. In a competitive marketplace as the agency landscape is, the more things you do well and right, the more chance you have of retaining the client.

So whats better then? An organisation like Audience on Demand that has a remit to make sure it is working with the best, understanding strengths and weaknesses – and believe me all these tech companies have them – or a heavily invested tech company struggling to make ends meet. Who is actually going to have the interests of the client? I can tell you, it’s us. Anyone who thinks that agencies and clients are naive enough to accept sub standard strategy and results just because its in house is a) clearly lacking in understanding of how an agency works and b) underestimating the clients and Account people. If a client asks about our impartiality we can show them the full vetting we do of all DSPs, I can show them the data compliance methods we have in detail for every supplier, I can show them the results in detail where an acceptable flat cpa or cpc is not acceptable as it encourages the supplier to focus on growing their margin rather than delivering the lowest metric. I will show you 100’s of people who live and breath this space and understand it better than any individual tech company thats trying to undermine it.

Conflict of interest is doing what you have to do to stay afloat in one of the most competitive eras of all digital times vs doing what’s best for our clients. Finally it is always worth analysing who is throwing the mud, its often one of those people who came in to town too late and cant find anywhere to hang their hat.

Data: The new Wild West

I have invited Paul Silver – Head of Product, AOD UK to comment on the world of data – here is his first post and the first guest post on my blog. Enjoy.

By the one and only: @thepaulsilver

The 3rd party data space right now reminds me to some degree of The Wild West. As a result of that mad gold rush era, the legacies created were: hastily erected housing, mob rule, vigilante justice, hyper inflated prices….sound famililar?

There has for sometime now been a lot of discussion around 3rd party data for audience targeting. ExchangeWire hosted the first EMEA Data Economy Event in March 2011. The hype seems to be lessening, but the appetite is as strong as ever.

The recent announcement of Xaxis developing a global audience profiling database reaffirms my belief about the synergy between the current data space and The Wild West. Agency Groups, Ad Networks, Data Exchanges, Aggregators – everyone is trying to get a piece of audience data, acquire it if you will (directly or indirectly) to fuel more precisely targeted audience based campaigns. And like the Wild West, I fear this rush for data is creating more confusion, execution of some bad practices whilst fundamentally the core foundations remain sub standard at best.

The upside of this ‘demand rush’ means publishers have more distribution points than ever, that can only be a good thing right? Or does it mean in fact that the more points that data is sold to, the more commoditized it becomes? Is that inevitable?

Some publishers that I have spoken to do not know where to begin when it comes to data monetisation. There is also so much data kicking around that advertisers do not know what to do with it, what to buy in terms of un-deduplicated reach and access, or even begin to understand the complexity around different taxonomies for what could essentially be the same user in the same type of segment. There is also the case of advertisers (and publishers for that matter) not knowing the difference between the types of data: inferred or explicit, lifestyle, interest, intent, social graphs(?), lookalike. The lack of standards and transparency exasperates the problem.

Like the mob rule affect created by the Gold Rush, publishers are increasingly becoming vulnerable too. Large agency groups are starting to wield certain influence in trying to bake data into trading deals. On one hand, publishing groups with limited scale are never really going to make a fortune from selling their data, but its the principle of how that proprietary data exits their businesses that should raise concerns. There is also the case of publishing groups still unaware of what data is being collected on their users from third parties. It is still very common practice for ad networks and certain agency groups to cookie from a creative. It might be pretty high level data in some cases but it’s still data being used to build out data repositories, leveraged for campaign targeting elsewhere.

Co-mingling of client data is an old argument; some of which believe to be mythical (one network told me it was not technically possible) whilst some believe it’s still an operational practice today. Either way it’s a practice that carries many sensitivities. An example is outlined below. I recently applied for an AMEX BA Card. I have since been served ads for BT following some recent site visitation. Nothing wrong with that. However what I found odd was the cookie information, that is being directly or indirectly leveraged, includes details of the Amex transaction. I may be wide of the mark of here and as the technology is based on exclusion and inclusion pixelling, maybe it ‘needs’ to know I am an AMEX customer so the rules can be defined to say “dont serve AMEX to this user, serve another ad from the pool”. Or it could be simply using the data they have on me to enrich the targeting parameters of the BT campaign?

As far as the publishers are concerned, yes there are companies such as Krux who exist to protect the publisher’s data, but there’s a cost to everything. The cost to protect your data could outweigh the amount it will sell on in an open market – a difficult business case to make.

But how are advertisers being remunerated? More importantly, being protected? Data networks are built by certain businesses off the back of advertiser funded campaigns / creatives. Publishers may well be remunerated for this, but are the actual advertisers? Their ads are running across ad networks and are the principle facilitator of data collection. Surely they deserve some of this rev share?

Lastly, but by no means least, why is there not more discussion and focus on how to better measure and evaluate the use of audience data? Without this, the rush for data is simply a race to the bottom – either data becomes less qualified (to make it more scalable) and therefore less expensive to deliver against a CPA or the data investment remains minimal because a scaled use of it does not cost in against a KPI.* We should be nailing this first and foremost.

All in all, there are some murky practices still happening with regards to 3rd party data. I think industry needs to clean up the data space somewhat before anyone starts cashing in on the latest Gold Rush…

*(Fortunately for our partners, we are developing a solution within VivaKi that aims to address this challenge, identify the real value of data and reward partners appropriately. We believe there is certainly value to delivering against your target audience and we hope to be able to scientifically measure this value).

Follow Paul @thepaulsilver