If you read this blog, you know I like to think about the advertising technology stack, in particular, ad servers. One of my most trafficked posts was about the 87.5% Luma category: Ad Servers. We have been having various conversations with companies who are building technologies that resemble what I like to think are next-generation ad servers.
1984 Won’t Be Like 1984: Tomorrow’s ad servers aren’t today’s ad servers.
Today’s ad servers are very similar to the original digital media ad serving systems. Many, not all, have similar attributes to the following:
- They are 3rd party cookie-based ad serving solutions
- They serve, track (and sometime optimize) standard IAB ad units
- They are made for the traditional web browser
- Two out of the top 3* ad servers are owned by media companies (Google, Facebook)
- They are primarily used by ad operations teams
At Ventures, we get to meet with all different types of marketing and advertising technology companies. That’s the only sector we invest in.
Over the past few years there has been lots of innovation around upcoming “ad servers” and I want to highlight what we might see adopted by the industry over the short to mid-term. Note, my bias is from the buy-side (agency, marketer) but we have investments ‘in’ and appreciate the sell-side (publishers, technology companies).
Ad Servers Are Content Servers
As the media agency model adopts owned/earned (they traditionally handle “paid”), the need for serving and tracking content emerges. The format of choice for traditional ad servers are banners but this will change and we see ad servers serving almost any sized unit. From this paragraph forward in the post, I use the word Content Servers as the new ad server.
Content Servers Are Platform Agnostic
As we innovate across more technological platforms (tablets, mobile phones, desktop, wearable devices, etc), we need content servers that can serve regardless of the platform. The server will understand which platform it has seen the user and will react accordingly with appropriate frequency and optimization.
Content Servers Go Beyond Basic Optimization
Many of today’s basic ad servers are rudimentary optimization. We’re seeing the next generation content servers including dynamic creative optimization as well. And beyond. If we believe that “big data” drives performance (which we do), then the Content Server should be equipped for this.
Content Servers Plug into Trading Desk/DSP/Programmatic Direct
As agency trading desks become even more central to their businesses, we see the Content Server connecting thru API’s to become even more tightly integrated. In some cases, we’ve seen some entrepreneurs creating a trading desk “serving system” which all of the agencies would use, regardless of programmatic or not, so that all the data resides in one central database. This creates less friction around data transportation and potentially a better/larger dataset for optimization.
Cookies to Brownies
While there is no legislation at this point in the USA, we do anticipate that something is coming. I don’t know anything more than the next person but we have to plan for a world where 3rd party cookies are legislated against. We’re seeing different types of technologies being used but all are basically the creation of the Brownie (my evolution of the cookie). If we are going to measure effectiveness for a marketer, we need a system that knows who the user is across devices.
Planning & Buying
In one system, you can plan and buy. This is not new. DART and MediaMind have basic tools. But we’re seeing the emergence of companies who are building workflow tools to create efficiencies for the agency and/or marketer. This is beneficial in managing FTE’s and helping structure a planning process which exists in Excel today.
Beyond Last Click
The default setting for traditional ad servers is “last click” but we know where that got us… it got us to 60%+ of every dollar being digitally dominated by Google. We need to go beyond the last click and look at total attribution of the campaign. We are seeing the emergence of full stack attribution making their way into Content Servers. And of course, better dashboards/visualizations that showcase performance of the campaign.
If you are interested in any of the above, you should check out companies such as: AdZerk, TrueEffect, Yieldmo, NextMark, OneSpot, GoldSpot and BrandAds. There are many more interesting companies but I picked these as a smattering of different spots in the ad stack.
I have not invested in any of these companies both personally or professionally at the time of writing this piece.
None of these companies have all of the above characteristics of the ultimate “content server” but are creating pieces of the value chain that could then go up or down the stack, depending on where they sit.
I still have open questions.
- I don’t know how cross-platform authentication/log-in will benefit/hurt the ecosystem? I hypothesize that the bigger players in this ecosystem will have a better chance at winning as they will understand who their users are across devices…and they naturally have more users.
- In order for the next generation Content Servers to really take-hold based on this post, it’s more of a full-stack play than point solution. Will agencies adopt a full tech stack versus a point solution?
* By top 3, I use the typical DART, MediaMind, Atlas. They are top 3 in my mind. Not by any specific list. If you have data to show me the top ad servers, I’d love to see it.