Category Archives: Advertising & Marketing

Advertising Industry Presentation – Need Your Help

I’m taking a cue from Fred Wilson on how he crowdsourced his Web 2.0 Keynote presentation.  The wisdom of all of you are much smarter than myself, so why not work together on this upcoming presentation.  What presentation you might ask?

Announced today, I am the keynote speaker at the Admonsters Ad Ops Forum on December 3 here in New York City.  I am excited about this forum because the people who will be actually going to it are the people who actually pull the “levers” in the industry.  Not that I ever “BS,” but this audience is a very wise one and I’m excited to speak to a very intelligent audience.

The goal of the keynote address:

Where once traditional publishers and portals were able to command the CPMs they wanted for all their inventory, they now struggle to provide differentiated, premium inventory that they can sell directly. Agencies have gone from thinking of online as an afterthought to seeing significant investment in systems to help them drive performance for their clients. Networks continue to evolve in every way possible as they attempt to develop their own secret sauce that will make them a top player among hundreds of others.

Following the shift of power is complicated by the fact that all the players are continually redefining their roles:  publishers and agencies are creating their own networks and ad exchanges. Publishers and networks are offering services akin to digital agencies.

This redefinition of roles not only applies to the companies themselves, but internally as well. The importance of Ad Operations for all the players has grown tremendously in the last couple of years. Ad Operations ability to help connect technology and process to the business side of online advertising makes it a focal point for our further evolution.

This focus is of particular interest to Networks who sit at the center of many of these changes and must remain nimble to survive. This creates unique challenges for Ad Operations leaders.

Darren’s keynote will take us through the macro level shifts in the balance of power, how that is redefining the roles of all the players involved and focus on how Ad Operations need to position themselves – especially at networks – for today and the future.

I have setup a few public and private conversation spaces for this presentation.  I will do my best to respond to each and every comment and will give attribution to the comments that I do use within the presentation.

  • Leave your comments below in typical Disqus blog format.
  • Give a call to 646-495-9271 x 44195 and leave a voicemessage with your thoughts.  This goes into a Drop.io account that I’ve setup.
  • Send an email to keynotepreso@drop.io with your thoughts.

For those of us in the industry, the Pubmatic Ad Revenue Summit guide did a very good job of showing the landscape, but I’d like to dive as deep as possible.

Thank you in advance for participating!  I will post the slides up here as they are created… (and certainly the finished deck).

Great Presentation: Evolution of Digital Communications

Saw this presentation on my friend Fred’s blog this morning and thought it was perfect for here.  Of all of the parts of the presentation (which I believe can be done in 120 slides rather than 200+), the slide that talks about data+insights hits really close to home during this part of my career and passion.  Check it out.
View more documents from David Gillespie.

Is the Market (and Tech Scene) Rebounding?

Recent headlines (within last 10 days):

I’m not going to pretend I’m a Wall Street analyst or an amateur Stocktwits guru, but where there is smoke, there is fire.  While I can’t prove that the market is rebounding overall, this is solid news and we are moving in the right direction.

If this continues, the M&A market will heat up and some startups and later stage companies that we’ve all come to know will be on the receiving end of some checks (and potentially some stock swaps).

Areas that should see some M&A activity:  location based mobile companies, buy-side advertising optimizers, mobile ad networks, mobile ad optimizers, and niche focused content sites.

Another sign of a potential recovery is the recent influx of headhunters, investors, company management all reaching out to find CMO’s and VPs of Marketing for their organizations and investments.  Company positioning and value proposition is critical during a warm/hot M&A market.

Ad Network Platforms vs. Demand Platforms

Lets define before we begin.

Ad Network Platforms:  platforms being built by current ad networks to service agencies and brands directly
Demand Platforms:  meta platforms that sit on top of multiple inventory sources

There seems to be a battle brewing between ad network platforms vs. demand platforms.  The trend I’ve spoken about on this blog for a while now and is now picking up at a faster pace are the ad networks we’ve all known to love (or hate) that are creating their own “platform” for brands and agencies to pull the levers instead of the people in their services group.

There are three types of ad network platforms that are being built out and non of them are mutually exclusive to the other:

  • Platform for buying audience segments & data
  • Platform for buying media
  • Platform for creative optimization

In theory and at first glance, these seem directionally right to where the industry needs to go.  Why wouldn’t brands or agencies adopt an ad network platform for their own use in their VMM/VivaKi/Cadreon/Adnetik/B3/ATOM group?  This is the major question and note, I can only speak for myself (VMM), but because this blog is of personal nature, I am voicing my own views, not the views of my employer (disclaimer).

The macro hypothesis that is being tested is:  agencies or specialist agency groups want to bypass the managed services part of ad networks and build the capacity for audience selection/procurement, optimization, and insights/analytics internally under the umbrella of whatever holding company they are employed at.

This post does not go into the reasons as to why this may or may not be smart but rather talks about why ad networks should not focus on building their own platform.

If you agree or can assume the hypothesis above, then continue reading.

The first iteration of ad network platforms (not to be named, but if you want a list, contact me) still are a closed loop system.  The reason why you would use a demand platform unit on the buy-side is that you want access to as much inventory as possible in order to make the smartest decisions for your clients (open).  By using one or even four different ad network powered platforms, you are making the job of inventory & data procurement and optimization harder than it needs to be.

Multiple platforms means multiple log-ins.  Apples to apples comparisons are not easy to make as each platform is slightly different.  Universal cookies are tough to pull off.  Biforcating data.  Duplication of bidding leads to artificially inflated pricing.

There needs to be a layer that plugs into the networks – i.e. a meta platform that can plug into as many inventory sources (networks, exchanges, sites direct, etc) as possible in order to aggregate as much data and media inventory.  I do not foresee a company like AudienceScience allowing X+1 to plug into it or vice versa in the near future.   That 3rd party layer is going to be crucial and that’s where the buy-side demand platforms sit.

I do not foresee agencies using multiple ad network powered platforms in the long run which means there is a forthcoming (and current) land grab to be the agency side demand platform of choice.

My friend Fred Wilson who blogs over at AVC likes to post entries on his blog that have his “wants” and hopes that people take note and action them.  I’m going to borrow that idea from him and try this here.  This is what I want within the demand platform and ad network platform space:

  • Ad networks to scrub their data and make it available for purchase without the media attached
  • Ad networks to plug into as many demand side platforms as possible (i.e. Invite Media, Media Math, Turn, etc)
  • Figure out the issues around appending cookies visa vi multiple vendors (universal cookie?)
  • Data should not have ‘minimums,’ if it works, we’ll buy more, if not, we’ll be back again to test another data set
  • Let the market price media and data as the real value will rise to the right buyer
  • Regulation/restriction/firewalls between the same company who sells/licenses/rents data and whom sells media

Anything else I’m missing?

ContextWeb Agency Demand Platforms Panel

Key parts of our talk on Agency Demand Platforms

  • What and why are agency demand platforms being created
  • Business models emerging
  • Impression level valuation

If you are interested in any of the above topics, take 20 minutes and watch the video.  Top agency holding company (and agency) execs chatting during Advertising Week.  Participants include Razorfish, Cadreon (IPG), VivaKi (Publicis), Adnetik (Havas), and me over at Varick Media Management (MDC Partners).

Check out the blog post over on ContextWeb.

Rational Expectations

When I was a doctoral student in economics at the Massachusetts Institute of Technology, a powerful theory known as rational expectations suggested that it was difficult to profit from widely anticipated, or predictable, events, since rational actors would already have taken the action necessary to arbitrage any such opportunities.  When I become a student of management, I assumed that an extension of rational expectations would apply in business; that is, any straightforward profit-enhancing opportunity in competitive markets would already be exploited and hence unavailable at the margin.

Well, thank goodness for me and the shareholders of Harrah’s Entertainment, Inc. that rational expectations is far from complete characterization of management behavior.  In short, opportunities abound to employ simple analytic methods to marginally or substantially increase profitability, especially in large businesses such as mine where a single insight can ring the cash register literally thousands or millions of times. - Gary Loveman, Chairman of the Board, President and Chief Executive Officer, Harrah’s Entertainment

I just wanted to share this passage as it’s written well and taken from the book, Competing on Analytics, The New Science of Winning by Harvard Business School Press (Thomas H. Davenport & Jeanne G. Harris).

Expect more quotes from this book in the coming days/weeks as I finish it.

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

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 CPMOver 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.

Advertising Week in NYC – Time to Navel Gaze

It’s that time of year again, Advertising Week in New York.  I’ve been invited to speak on the main stage and on a few panels at various events.  I’m going to list the events below and if you are attending the conferences, certainly reach out to say hello.

You can follow Advertising Week on Twitter.  The official hashtag is #adwk

Monday – OMMA Global // 4pm – Marketers Ask – Is Paid Advertising In Social Media Dead? // http://bit.ly/14r8sa

Tuesday – AAAAs Jay Chiat Awards // 12-4pm Main Stage Speaker – Provoke:  De-Averaging // http://bit.ly/k1ywh

Tuesday – IAB Mixx Awards // 6pm // http://bit.ly/okIU0

Friday – Advertising Week // 11AM – Agency Demand Platforms, Is Everyone a Media Trader? // http://bit.ly/mCGgi

Other than the IAB Mixx Awards on Tuesday evening, I do not plan on attending after hours events.

POV: Viral Videos For Brands

I wanted to name this post, Viral Video Crap, but that wouldn’t be on DH brand.

While reading Peter Kafka’s column, MediaMemo on AllThingsD this evening about Microsoft Word and it’s impending verdict, he linked to a video of a gentleman in a wet suit who rides down a slip-n-slide and launches into a kiddie pool.  This video was posted to YouTube and has over 1.3MM views as of writing this.  As it turns out, Microsoft Germany created (or had created) the video and it links back to Microsoft Project (www.megawoosh.com).

I do not get it.  The video is cool and the SFX are pretty sweet, but how is this on brand for Microsoft and do I feel any more love for Microsoft Project than before?  No.

I hear all the time from brands that they want to create a “viral video.”  First of all, no one creates a viral video – consumers decide what becomes viral or not.  Secondly, most videos that become viral are not on brand for most clients.  The video, while most times laughable, does nothing for brand recall or even lift in brand attributes.

Just because a video achieves 10MM views, does it mean it does anything for the brand?  I’d love to see some research to prove me wrong.

Recap of Fashion2.0 Meetup Event

fashion20I’m not going to recap the entire event play by play, but do want to highlight some of the interesting tidbits.  The hashtag (twitter) for the event was #fashion20, so you can follow the tweets here.

Of the 5 companies presenting, I found 3 of them interesting – they just happened to be the B2C plays.  There were 2 B2B plays, but since I’m not a fashion designer or retailer, it didn’t strike me as interesting (but I sure can see their value proposition).

In no particular order:

Pier Eleven:  These guys are trying to merge art and fashion by releasing t-shirts with artists designs on them.  I think that this is interesting if they are limited edition and the artists are of fame.  Pier Eleven is applying dynamic pricing which is novel, in the sense that the price rises for each additional t-shirt sold.  If you are looking to get access to PierEleven.com, the access code is “Whoareyouwearing?”

iStyle Media:  I think these guys have a lot of promise, but they didn’t talk about their company the right way which led to many of the “investor” panel to ask “wrong” questions.  I can’t stress how important it is to position a company the right way and these guys missed the boat.  Anyway, iStyle Media is a Facebook application that allows people to tag pictures based on the clothing they are wearing and find other people who are wearing similar clothing and learn about different styles.  iStyle Media can help consumers in fashiondiscovery phases and also, recommendations.

ProperCloth:  I was looking forward to meeting these guys as I am on a MEconomy kick and custom shirts are part of that.  These guys have a very intuitive and easy to use online interface where people can order custom shirts.  What I like about this is that if you have a shirt that fits really well from a major manufacturer such as Theory or Hugo Boss, ProperCloth can match the same sizing specifications.  These guys also provide some great finishing details as well.

All in all, it was a great meetup.   More people that I expected and some great conversations post.

@yuliz and @mikepratt did a fantastic job organizing.