Digital Marketing Tidbits: Social Media, CPM, Ad Serving, and RTB

Posted by Darren on Sep 27, 2009 • (Comments)

I have not been updating the blog as much as I’d like and have a few long-form posts I’d like to write, but based on my schedule right now, that’s a long-shot.  I’m going to condense the posts into a paragraph each and if people want me to expand on them, please comment or reach out to me and I’ll spend more time writing.

Social Media Strategy – your social media strategy should be part of your marketing and communications strategy.  I do not believe that social media should live in it’s own silo.  A solid marketing department or agency will understand social media at its  core and will work to involve the benefits into the overall strategy.  It’s only a matter of time until the many opportunistic social media shops will either be weeded-out or acquired into larger entities.

Let’s Not Kill the CPM – Over on TechCrunch, Shelby Bonnie, former CEO of CNET, talks about wanting to kill the CPM.  His usage of CPM is incorrect and is misinformed.  Additionally, since many people think that CPM is a digital media term, there was additional pickup across other blogs and the tech industry started to drink their own juice.   First off, CPM is a planning metric in which marketers are able to put a cost to 1 thousand impressions.  While CPM is a metric that can be used for cost-basis, it is NOT a metric for performance.  Marketers who are optimizing to the CPM without overlaying other engagement stats as KPIs are the ones who should re-work their strategy.   CPM also is used in offline mediums such as Print.  This allows for an apples-apples comparison for rate basis.  To Shelby’s credit, I do believe he was trying to illustrate something different (and valid) but “killing the CPM” is something that’s a hyperbolic title.

Ad Serving Systems – Current ad serving systems such as Google DART or Msft Atlas must change their positioning or they may be toast as the industry evolves.  The current ad serving systems must provide real-time bidding engines within the next few years or they will be defunct as new players (i.e. Invite Media, Dataxu) start to eat their cake.  How much success will Goog/MSFT have with re-engineering their legacy systems?  Time will tell.

Real-Time Bidding – Today, this does not impact the majority of agencies, advertisers, and publishers, but within the next 3 years, the media landscape will be at a tipping point.  I do not know why I picked 3 years, but it seems reasonable.  Imagine a world where you can value every single impression in real-time based on the amount of data you have and the models that you put together… starts to sound like Wall Street… and yes, that’s the insight I am trying to illustrate.  Quantitative analysis is coming to advertising beyond where it is today (it’s already here in most major media shops) and the technologies needed to service RTB will start to emerge.  I’m fascinated with this space from the agency side, client side, and tech side.  If you are building something here and we’ve not spoken, I’d love to hear from you.  Additional:  My comments on the Google Advertising Exchange.

Tagged as , , , , , , , , , , , , , + Categorized as Advertising & Marketing, Internet & Web X.0, Technology
  • Your first two points seemed to be aimed at novices and those unfamiliar with marketing as a concept. Your social media strategy should no more be divorced from your digital marketing strategy than your digital marketing strategy should be divorced from your overall marketing strategy offline and online. Its like removing a foot as part of your preparation for running a marathon.

    It is a good thing to remind people though of how and what CPM should be used for. Spot on, it is an indication of cost not performance however I think the post was about moving away from a model where cost was a base indicator and moving to a model where performance was the only thing to be rewarded. It is a valid point and one that a lot of online media owners need to wise up to before CPC makes the argument redundant. Selling space online based on CPM has rapidly become a brand marketing only exercise as support for direct response media like CPC and email. I'm not convinced that media owner will be able to sustain their current CPM valuations as more and more advertisers wake up to that. If the media owners were to move to a CPC model how many of them would not be embarrassed by the performance figures they produced?

    Ad Serving and Real Time bidding was a hot topic at Ad Tech and I think you are right that it is going to pre occupy the industry's thoughts for a while but unless they provide ads that perform I suspect that the yards of column writing will amount to no more than a whisper in the corner at the end of the day.

    The central point is that advertisers are getting smarter and as budgets tip ever more in digital's favour so the smoke and mirrors will be lifted en masse and media owners will have to stand not by what they say, but by what they do.

    Aaron Savage
    Managing Director
    Interactive Mix Limited
    http://www.interactive-mix.com
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