Persistent Identity – holy grail available to some..

20130912-204926.jpg
I am Just back from meetings in Seattle and San Fran with the Big 4. Big 4 you ask? Well in todays world of data connectivity, mobile innovation and growth as well as digital commerce the big 4 has changed. Facebook, Twitter, Google, Amazon are now gunpowder and bullet. The others more and more the barrel.

The message that is coming out loud and clear is that these players in their own varied ways are out to maximise the insights they have on their users and customers through a single themed approach of ‘Persistent Identity.’ I heard it a few times over the time I was out there, I have seen it mentioned in the odd article. But when you get to spend three days with all these market leading companies it becomes loud and clear that the data they hold on consumers is the key to their future and the single most valuable asset.

20130912-205128.jpg
Persistent Identity is a fancy way of saying ‘we know who you are, we know where you are and we know what device you are on, the holy grail of data. The kind of data and insights advertisers are crying out for. What strikes me about this data is how much more powerful it is than third party data sold by any number of companies, data which is slightly worn out, like an old apple at the bottom of a bag, still edible but just not as fresh and juicy as when it was picked.

The ability to recognise you, add insights to your iD, serve ads depending on which device you are on, understand you through your behaviour by device, friends, clicks and links is so powerful, so powerful in fact you can see the likes of Facebook being the defacto judge of what is good or accurate data instead of the traditional players. That has already started of course but I think will gather momentum. Watch out panel data.

When you take a step back and realise what data they have you can understand why they are reticent to share it or risk it being stolen, putting up walls of protection around it. Amazon with their marketplace, Facebook only allowing access through API, Twitter pulling info from Google, these are the actions of companies with hidden treasure. These businesses dont need all the old methods of tracking whether it is panels of adserved cookies, they know their people, signed in, registered people at scale.

Persistent identiity is powerful and logical, the only problem is that you have to stack up on these solutions. Like having a car and pulling up at the fuel station and putting 3 or 4 different petrols in to be able to get the car going. I want to recognise everyone through the ability of joining up these players – I would love to spot a FB user who has been updating a status about an iPod, browsing on Amazon and nail them with a promoted Tweet or video Ad to close the deal. I know it is too much to ask to have all these companies reveal their secret source but targeting would be fun..

Either way, data businesses will need to work hard and fast to justify their models in the face of the biggest digital players in the world starting to pull up their sleeves and flex their guns, because be under no illusion they are big guns.

Our latest recruits – Their views, one month in at Audience On Demand

Image

I thought I would ask our three latest recruits, all graduates to give me their view of our industry just one month in. The message is clear, we are big and complex and we love TLAs but that is what makes it fascinating. Backgrounds of economics, maths and marketing show that regardless of diverse backgrounds, all roads lead to RTB! Sorry Real Time Bidding! I am always excited when we have new people joining and so let’s hear from them..

Trisha Halai @trisha_halai

Having done a maths degree I never thought I would see myself taking on a career in the digital advertising industry. After being approached by a recruitment agency and being told about the role and company – I can say I will never look back. My first month has been very much a learning curve and a very interesting one. Understanding the technical aspect of the role in terms of getting to grips with the platform and the systems has been one thing and understanding the hundreds of jargon used in advertising is another. Initially, I was completely thrown back in my first week when I heard acronyms such as DSP, SSP, DFA, DFP, DBM, MPU and PMP to name a few. However, as time has gone on and the more I have heard these terms, they have become second nature to me and now not using them would be slightly absurd.

Coming from a maths background, I developed many transferable skills and I can say I am proud to have the opportunity to apply these analytical, problem solving and logical thinking skills into my current role.   Working in a dynamic and creative industry, one that is so measureable and trackable in every aspect is exciting. It is great to be exposed to the industry at a point where it is constantly changing and advancing. Communicating and building relationships with highly respected technology and data providers and some of the big publishing names as well as agencies is what makes the day-to-day role so varied.

Being part of the AOD team at Vivaki has been an insight in many ways. It is very exciting working in a team that helps brands to deliver strong, highly targeted messages to very niche audiences across many channels such as display, video, mobile and social media. Working in a team that takes great pride in what it does and is passionate about its day-to-day management of campaigns is inspirational.

I look forward to learning new skills and developing a deeper understanding of my current role and I look forward to any challenges I may be faced with in AOD.

Claire Hobson @claireHobs

My first month as a member of the AOD team at VivaKi has been both exciting and eventful. I’ve had the opportunity to meet so many new people and have learnt a great deal about the dynamic industry of digital media in such a short time.

As a Marketing MA graduate, I had developed an interest in digital marketing and was keen to get into this area as a first step in my career. However, I had never come across agency trading desks or real-time bidding and as a result I found the complexity of the real-time bidding ecosystem quite overwhelming when I first started. RTB, DSPs, Ad exchanges, ad networks, ad servers, SSPs, PMPs… it was all like a foreign language to me, particularly with the frequent use of (appropriately named) TLAs.

Four weeks on, what seemed complex to me back then is now much clearer, having benefitted from being amongst the hugely knowledgeable AOD team and from meeting the various external teams that represent the other vital pieces of the RTB puzzle. I have noticed the difference in levels of understanding and views of RTB across these different teams, whether it be media planner/ buyers, publishers, data providers or technology platforms. This has been useful for me to gain a more holistic understanding of how RTB is viewed in the wider media industry and has helped me in developing my own opinions.

Part of the reason why I wanted to work in digital after graduating is that it is an industry that is growing and constantly changing, making for an exciting and fast-paced environment to work in – my first month at VivaKi has definitely confirmed this. However, it has also highlighted that there are often challenges, difficulties and problems to solve around these changes, something that I did not previously fully appreciate but have come to see how this is key to the development of such a dynamic industry.

A good way to sum up my first month is perhaps not to reflect but to look at how it has given me both an eagerness to learn more and a strong desire to be a part of the future of RTB, whether it be in display, mobile, video or even connected TVs. I look forward to my second month at VivaKi in the exciting world of digital media and RTB.

Nick Brown @NickPhBrown

PMP, IO, SSP, DSP, KCT, vCPM, KPI, ABC1, GRP, MPU, RTB are just a bunch of letters… However, I have come in to contact with them such remarkable regularity that I find myself thinking what a laborious task it would be to have a conversation using full, un-acronym-ed words. Since, I started work at VivaKi, the AOD team has performed massive brand blasts, won over some great clients, tested cutting edge industry inventory, even achieved a world first! The list goes on… We work closely with companies like Doubleclick, VisualDNA and large pubs like eBay and Amazon, all to our own varied ends.

Point being, there’s so much to Real Time Bidding; too much to ever come close to having a shrink wrap solution to it. On top of that, it is constantly morphing and progressing. Not only are Mobile and Video making leaps and bounds forwards, but the platforms we work with on a daily basis bring in a whole host of new features almost weekly. It’s a crazy trade to be in and my first month has overwhelmed me with a phenomenal amount of information. I would love to write all about the diverse, highly affable team I’m working in, and on how much fun I’ve had in the many social events that have already taken place but if I tried to it would fill pages and pages. Suffice to say that my first month has been a whirlwind tour of the immense and fascinating world that AOD is right in the centre of: RTB.

 

Venture capital – are you a write off?

Over the last few months I have been spending more time talking with Venture Capital firms as we start to launch VivaKi Ventures in EMEA and I have to say it has been fascinating. On top of that I have been talking with individuals who have working in multiple start ups. If I am honest I am struck by the combination of instinct, nous, luck, crowd mentality and incredible returns and losses the VCs work off.

Information is extremely varied and disparate but overall it appears that the funds do a number of things, they are looking to make sure they have some ‘skin in the game’ in different sectors – we must be in mobile, we must be in video etc, sometimes buying into companies that from the outside appears misguided – Groupon to the punter on the street just appeared crazy but that did not stop anyone investing. Then we have this emotional crowd mentality where people in the investment community get excited and invests illogically based on sentiment, not dissimilar to the city swings we see on share prices.

In times of financial ups and downs investment firms are then trying to recoup the best returns, again, perhaps not always thinking straight in IPO situations, one of the views on Facebook was that the institutional investment firms had cash, it was making no returns through any conventional financial methods whether the stock market or banks and so the money was burning a hole in their pocket. An IPO like Facebook and others was a great opportunity to hit those return goals.

After all that there is the general rule of thumb that anywhere between 30 and 50% of companies will be complete write offs. I got thinking about that, and in discussions on that subject it struck me how blase they were about it. It is not working, cut it. You may be an owner, founder, an employee in these companies working hard and caring very much whilst backing you is a company that may one day wake up and say – lets pull the plug. It feels like that is an easy thing for them to do, when they are balancing that decision with high returns of 30x somewhere else. It is very matter of fact and shows just how hard it is to be a successful start up, especially in such difficult times.

I know for sure that there are good VC firms and less good in terms of caring for their investments but they all for sure know that they can walk away from companies easily as it is all built into the maths.  Good luck to everyone who starts their own business or joins a start up. It is a brave world.

Agencies and publishers are polarising structures based on the perfect storm

Technology killed the admin star.

One of just many debates raging around the new world of programmatic buying and exchanges. Are we seeing the death of the buyer? The death of the seller? Has the world of computers stripped advertising of all its creativity? Lots of big questions and debates but over the last six months, one common thread has become apparent; there is no value in execution in the long term.

Two or three big themes have converged in the last year, they have been around for longer of course but they have been lit up by the tech debate. The first is that in my view too many businesses sold their value on execution and delivery. These are necessities and you can’t not have them but is that where the value is? Is that what you charge more for? I don’t think so, the agency world in particular suffers from focusing a lot on service and delivery and execution over real value add strategy and quality creative thinking.

In itself that is not the end of the world, many advertisers want perfect execution of course, but what it ends up being then is an easily quantifiable, discountable service that becomes very commoditised – tell me the difference between two media agency TV departments? Secondly lets combine that with the fact that the world of Paid, Earned and Owned means that clients are now not only trying to squeeze costs and fees they are starting to see these new approaches as a gateway to spending less. I have just finished doing preliminary judging and of about 40 entrants at least 37 boasted / moaned (not in so many words) that they had little or no budget to make their campaign work.

So we have smaller budgets based on the social buzz doing the heavy lifting for us and we have fees for service and execution being cut – that leaves us with only one alternative – start to charge for ideas and creativity, for strategic guidance so that the execution is less crucial to the revenues. This works more now than ever as to make the social buzz work for you, good ideas and strategy are needed to do it..it is no coincidence that the non traditional media planning and buying teams in agencies are the fastest growing divisions. Big sponsorships, events, social strategy, performance strategy, content, these are where the future lies backed up with technically led brilliant basics.

To gain traction strategically you need to invest in good people. You also need more of them. Investment  in the current climate is not straight forward so you need to rebalance the organisation. The investment in time and people from a strategic perspective needs to increase and at the same time you need to make execution more efficient allowing you to free up people and resources to focus on intellectual capital. So Enter the third factor  – programmatic buying.

Ask a customer if they want to pay for a load of people bogged down in admin, or people actively thinking about how best to run their business and make it a success, the answer will invariably be the latter, but that’s what we all do in the main at the moment. Clients pay for people and hours spent on too much Admin and not enough thought, this situation needs to change. Technology and programmatic buying/selling is now allowing all companies to achieve efficiencies. Whether it is publishers like the Guardian or agencies through trading desks technology is freeing resource to focus on value rather admin.

Publishers are moving fast now, after a stuttering start, they are moving rapidly, trying to find ways to move more and more into programmatic sales, now with words like premium and brand being attached. They are opening parts of the site, previously sacrosanct such as home pages to the evils of tech. Trading and execution is taking a back seat as Partnerships, strategy, event type words come to the fore – BIG ticket sales are now the focus.

Some recent people decisions are a reflection on that with people like Vevo choosing Partnerships people over sales people and Yahoo re-evaluating structures and there are many more. I am sure The Guardian will be looking to Tim Gentry to help them achieve better margins and a more efficient approach to the market, the signs are there..

So for me the message is clear – we all need to find a way to make money from clients and customers who want to pay less for service and execution and spend less on advertising. Armies of people pushing excel around is not going to be the answer.

Balancing short term demands with long term strategy

As the digital landscape evolves so the companies within it have to adapt as well, but actually we all live in a short term world. Both publishers and agencies have their work cut out for different reasons but all too often good strategic decisions are being strangled by short term demands. This challenge has never been more obvious than right now.

I have been talking daily to organisations both in our group and externally about how we plan and adapt for the future, we can all see the major digital portals for instance having to sit and scratch their heads a little about dealing with the here and now but planning for the future. Take a Yahoo or a Microsoft, they have both embraced the new world of exchanges and yet somehow want or need to protect their network offerings, the two don’t sit easily in reality. As strategies they should be rewarded in their approach of embracing the exchange world, but instead they are under pressure to deliver their targets based on a 2010 estimation, when the world was entirely different. Was it that different? Were we not all talking about exchanges etc back then? Well yes we were but the spend was not backing up the rhetoric, 2011 is a different story. Audience On Demand, as the biggest exchange trader in the UK has accelerated incredibly, and that growth is having an impact. Look at Specific Media who but a year ago was recruiting staff and buying Myspace and a few short months later is making redundancies, that’s how quickly things move.

We are though at a juncture, and it’s for that reason we need some patience from the bean counters. 2010 did not properly represent the Exchange growth, 2011 is closer to the truth but 2012 will be big. As the long tail of Ad Nets is absorbed into the more focused addressable media hubs and digital consolidation continues, the likes of the Yahoo or Microsofts will begin to see the benefits of the exchange infrastructure and will be able to let go of the old DR network approach. They will start to reap the spends that once went to the Ad Nets, but this time via exchanges.

It is refreshing to see the strategy Yahoo are playing out in the us. There was an article today in fact on this in Adage – click here. They are going to take a hit in the US with their strategy of blocking the Ad Nets, Criteos and others from buying their inventory. Yes short term that is going to hurt them, longer term its a great move and will pay back undoubtedly. We are seeing a significant adjustment in the digital ecosystem.

Agencies are evaluating just as fast, less from a revenue perspective, more from a structural perspective. If you designed an agency today, would you do it the same? I doubt it and yet the upheaval required sometimes makes people think twice and come up with a number of reasons why they should not do something even though in the longer run it makes perfect sense. This requirement to change however on agencies and publishers comes from a number of key trends;

consolidation of digital, we have all seen the stats that show the big digital companies control a huge percentage of the total spend and audience, even within the exchange space you are dealing with a few big partners. I believe that clients are starting to see a new digital landscape that is not 40 sites on a plan. They are realising that actually they can achieve almost all they need with API buying, Audience On Demand and Search, its a shift, everyone is looking for scale and efficiencies.

Globalisation of media and advertising. Most pitches are becoming global, not all, the recent in for ZenithOptimedia of RBS proves that, but many are. As such as the clients think more globally then they look to the agencies to do the same, and the more you think like that the more the scale partners of Yahoo, Google, Microsoft, Facebook etc become important to them and us.

Commoditisation drives value. This is an interesting development for me. Years of being told by Microsoft and Yahoo etc that their inventory is ‘premium’ has rarely been backed up by any real insight except their own research. Now we have commoditisated huge swathes of inventory through DSPs and exchanges we are being able to see what value inventory has and what performs. We see the volumes of money we spend with these companies through the DSPs and what eCPM we pay for them, none of this is determined by a person or a power point slide or negotiation. Tech has decided, results have decided and demand has decided and the patterns are very interesting indeed. After millions of pounds of spend through Audience On Demand we now see the true value of inventory and yet it has never been more commoditised.

Technology is in fashion. Of course tech has always been in fashion but never more so than now. It has been developed for agencies in a meaniful way. Demand Side Platforms for exchange trading, Bid optimisation platforms for search and API buying, these things have been designed to help us drive efficiencies and improve performance and we really see the opportunity now. It’s brutally competitive though and VivaKi have decided to work with the best partners and then develop tech that links all those partners up providing an interface to work with, this we see as the great opportunity, if you then add that to new streamlined teams and workflow, you have a heady mix that can deliver fantastic performance and service.

So where does that leave us? It leaves us with a lot to do and we need more people to take up the challenge and either drive the change through their organisations or give the people who have to do it a break so they can work through this transition. The end result though is the ship has sailed, the change is underway and we need to embrace it or become a dinosaur.

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.

Hard work being a technology company at the moment

I would not want to be in this space at the moment. It is fiercely competitive and every man and his dog has a new angle on targeting, tracking, bidding and the like. Digital has always been like that, a constant stream of questions from clients, planners and other agencies along the line of – ‘you heard of x company, apparently amazing, can you have a look at it for me?’ Being on the inside of a technology company must feel like that at the moment, especially big ones like Google and Microsoft.

The energy at the moment is focused on biddable media whether that be ad exchanges, search of Facebook API and therefore companies have come along like Marin and Kenshoo to challenge the elite. They are new and shiny and fast and they produce product roadmaps about 6 months ahead of the slightly larger more sluggish rivals.

Teams in Doubleclick now are constantly being asked about what can be integrated into their systems like DART search, it’s a fair question because the market is moving so quickly the agencies are having to adapt rapidly and therefore they need their suppliers to do the same. Deep integrations that are hard to move is not a good enough reason to stay with a supplier. It’s not however as simple as doing the usual Google bashing or Atlas bashing, I have some sympathy for them. When they change one thing it has to deliver against all their other systems and make sure that nothing falls over. With great volumes and large customer bases comes a big responsibility to not mess up. Some start up with 5 clients can afford to mess about a bit and change things as it pleases with little or no impact, Google can’t do that.

I would like to see what happened if an agency said to one of these new companies – OK I will move all our spend to you, we want 24.7 customer service, technical support, migration in weeks, nothing to go wrong, we want to check all your contracts and privacy set ups and all the rest. Simply, they would not cope. So on that basis I think we have to understand that there are many pretenders to the crown but they could not all make it and its easy to bash the big boys.

Nevertheless it must be hard work right now and I don’t envy them. Sometimes things just do not work, today we saw the end of Google Wave. Of course we did, it was a nightmare. A small part of me does think though that those resources could be redirected into services that meet the real needs of customers rather than so many experiments. How is Buzz doing?

Outside of that particular field there are so many companies selling data, targeting and tracking. They all want a piece of our client’s websites, they all want a test, it is a minefield out there and sorting the wheat from the chaf for agency digital planners is extremely hard and often hard for the companies to differentiate themselves. I have not seen so many new companies selling their wares since 2000, they wont all make it and as agencies we need to somehow back the right horses..