Tag Archives: AOD

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.

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Digiday Post : The Ad Tech threat agencies need to take seriously

My piece on Digiday outlining the threat of Ad tech disintermediation. First posted here.

I remember sitting with a founder of a well-known demand-side platform a few years back (feels like a lifetime), and he was warning me how the evil Google would disintermediate us all and destroy the agency trading desk business if we were not careful.

The irony now is that the worst culprits of all are the new, up-and-coming tech vendors who are chasing the direct-to-advertiser relationship at any cost.

As an agency, allowing a DSP or real-time bidding ad network to control all the programmatic spend may seem the same as giving an insertion order to an ad network, but it is far from that. The rules have changed with the rise of ad tech. Our whole business is based more and more on data. We need to manage, explore, test and learn with data, and the data needs to be held at the hands of the agency running the wider business, or remain in the advertiser’s hands should they choose to take the process in-house.

To release tens of millions of dollars to a managed service DSP is to release all of your intellectual capital to an external company where the same rules expected of an agency may or may not apply. We see clear benefits when we are able to apply the agency learnings to all the programmatic opportunities. Whether we are looking at cross-channel attribution, econometric modeling or online and offline synchronization of media spend, we can make activity work so much harder in that context — and tie it back to the advertiser’s own data whether on or offline. A third party, or siloed business, simply cannot do the same.

Agencies take heed: This is no longer just a question of outsourcing some digital buying but rather the outsourcing of your agency role and intellect to a third party. You may not recognize the danger, given the modest level of programmatic spend relative to massive TV budgets. But when this spend drifts away, a little bit of control goes with it. Not a good situation given the projected growth of programmatic.

Take a lesson from search. Two things happened in search that made it one of the biggest battle grounds of the agency world through the mid-2000s. The first was that the agencies ignored it when it launched, and the second was they fought tooth and nail to get it pulled back into the agency when it had grown into the mammoth beast that it is today. Today’s DSPs are yesterdays search villains.

An agency digital lead should fight to keep the programmatic business close. Yes, I am biased toward a relationship with an agency trading desk — not just because data-driven, programmatic buying will be the lifeblood of the future media agencies but also because the right agency/trading desk relationship is better for clients.

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 marketer is tied to a single provider. They move at the the speed of the provider. Or they pay the 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 marketer know? It’s 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 the brand safety, starting with basics like full disclosure on where ads are appearing and how much of your budget was spent on media. It is fascinating to me that Rocketfuel discloses 60 percent margins and there are no concerned glances from advertisers. Really? 60 percent?

I have been warned all my life that Google is the bad guy, but it is becoming clear that as the story unfolds, we are seeing a very different picture. The VC-fueled pressure cooker we are in at the moment is creating disintermediation on a grand scale or at least the potential of it. And agencies and advertisers should both see that there is a major role for their partners in helping them steer through this time so that we don’t walk blindly into a repeat of 2001-2008, an era that both agencies and advertisers regretted longer term.

 

Beet.TV interview talking video retargeting, Ad fraud, value vs price

Beet.TV interview talking video retargeting, Ad fraud, value vs price

Discussion of some big issues of the day around video. The role of auditors, advertisers and agencies in Ad fraud / quality issues, how programmatic video can now be a creative way to continue dialogue through re-marketing and publishers ultimately will benefit from the fact tech is starting to reveal how poor many Ad network sells are to clients.

This time it is a one way ticket

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As anyone who is crazy enough to regularly read this blog will know, every so often I intersperse the world of digital media with some of my own personal experiences. Well today personal and professional collide as I contemplate for the first time in my career getting a one way ticket to the US and taking my family with me. Many people have done it before and many will do again but to me this is a big deal and one that brings equal quantities of nerves and excitement. 
 
I am moving to the US, the Big Apple no less to help shape a new chapter for Audience On Demand with a focus on client relationships and delivery. The crucial relationships we hold with our large agency partners and their customers as well as our direct customers. I am retaining my management of EMEA at the same time. I leave that business in incredibly safe hands and the management team of Geoff, Danny, Jean Baptiste, Anke, Sara, Lothar and Cesar who I know will continue to work as always in a collaborative and market leading fashion.
 
The US market is a behemoth that I think us Europeans take some time to understand and just as Europe is often over simplified by Americans,  I believe we have the same capacity in return. I stand in awe of the scale and complexity but the complexity I can handle, Europe with its multiple markets, currencies, characteristics, politics and all is hard to rival, you just need to spend time and effort getting to understand it all, and above all listen.
 
I join a great team in the US, my colleagues are a group of experts second to none and I know that we have a winning formula, I am excited to learn from all of them and I hope in return I will add value to the people who I will work alongside.  I have read headlines recently about consistency of leadership and a teams that have been in it from the early days as regards other agency groups well we have that in spades. The people I am working with have in the main been together for 5 years and more with leaders such as Frank from the very start of VivaKi so we have a strong bench. We live in times where mobility and global capabilities and sensibilities are central. When I started my career we were all living and working in our own domains now we are a single connected globe with advertisers looking for global insights and a joined up approach. I am excited that my amazing European adventure has now expanded into a US one, it makes sense and to any global advertiser I hope will be additive having someone who can discuss their business across the globe and for that reason I am grateful to VivaKi for giving me this opportunity.
 
Interestingly, when you look at different organisations I am proud of what VivaKi has allowed me to do and I have to also comment on my wife’s company Unilever who have allowed her to move to the US with me, with out missing a beat, it was truly impressive to see how empowering an organisation can be when it makes these moves possible. Just in a few short months we have moved people from US to UK, UK to US (not including me), US to Singapore, and many more before that, this is the new world we inhabit, and it is exciting to be part of it.
 
Now perhaps the hardest part will be navigating New York streets on my motorbike, or getting used to a new culture but I can’t wait, from memory there are very few motorbikes in NY so you will spot me around Hudson street! This is not just a work move but an adventure, our four year old son does not get it yet, but he will and he will love it, I need to keep my eyes focused keenly on him to try and soak up his wide eyed wonder and not get blinded by work stress and strain, it is vital for us all to enjoy our time here. I fully intend to do that, and can’t wait to get my feet under the desk and get stuck in, so New York, here we come.