Tag Archives: tracking

Cookies Will Become Brownies

Cookies seem to be dominating the conversation lately.   While I’d prefer talking about black + whites, chocolate chip, Mallomars, or Milano’s, our attention for the past year has been around the ecosystem surrounding first, second and third party cookies.   This post will not go into the technicalities around cookies but rather the idea of cookies in existence.

Cookies (of the computer context) were created for website session management.  They [cookies] were not originally constructed nor conceived as an advertising tool.  Once the initial 3rd party ad servers were built in the mid 1990s, they relied on these cookies to help track and measure a digital media campaign via leveraging data written to and contained in a cookie.

The majority of the $117.60 billion dollar* worldwide digital media ecosystem is beholden to the cookie.  It’s why the IAB has fought so hard to protect the third-party cookie, as every company who pays the IAB its annual dues are impacted by the potential threat to remove third-party cookies.  You cannot fault Randall for protecting his fiefdom and the organization that he has successfully grown.

In the above paragraph, you will notice I reference the specific type of cookie:  third-party.  All too often in our conversations, we do not reference the specific types of cookies we are talking about.  Much of the spotlight in today’s conversations is around third-party cookies.  These are cookies that are set by neither the consumer nor the website they are visiting but rather a third party in the equation.  Sometimes this third party cookie is set by a third party ad server such as DoubleClick DART, a data company such as CrossPixel, a re-targeting company such as Criteo, ad exchange such as AppNexus, supply side platform/private ad slot such as Rubicon, ad networks/DSPs like RocketFuel + MediaMath, social plug-ins like Facebook Beacon/Connect, and many other examples.  Reference the Lumascape for Display for many other companies who utilize 3rd party cookies.  As you can see, I drew this out on purpose because the impact of the threat to remove third party cookies has far reaching consequences.

I was sitting with an investor yesterday and she asked me straight out, “what happens if third party cookies go away?” I get this question often and I half jokingly say, “we’ll have cupcakes and brownies.”  I’m actually serious here.  She looked confused and laughed with me… but I provided some backup.

Digital advertising dollars are invested, traded, measured, and optimized on the idea of “quantification” of spend.  Validation of spend.  Measurement of spend.  Whatever other word you’d like to use.  This quantification, while not 100% accurate, is better than any other media channel we have… and is pretty much all based around a third party cookie.

My view: If the third party cookie goes away, the industry will create something to take its place so it can continue to measure.  A brownie or cupcake if you will.  Or Milano or Mallomar (if it were up to me).   

This is validated through many of the conversations that I’m having with young startups and larger technology/media companies.  Hearing terms like UDID, ADID, safehouse, clearinghouse, serverside, and others are being thrown out as ways to help identify, target, segment, scrub, or track display/mobile/tablet devices.  I’m sure there are dozens of ways in addition to the ones listed that are being built by different firms.

The impact of the removal of the third party cookie will have consequences to IPO candidates and currently public companies such as ValueClick, RocketFuel, Criteo, YuMe, Tremor, Marin, Facebook, Google, Yahoo!, AOL, Microsoft, Acxiom, and others.  Criteo and RocketFuel are probably most vulnerable as they are going thru their investor roadshow and this should be one of the first questions that investors ask.

Some cookie based thoughts:

I never really understood the Facebook acquisition of Atlas Solutions.  It dawned on me a month or two ago why it was special and unique:  If Atlas has the ability to deliver an ad server solution in the client domain space, then it can feed the Facebook audience segmentation data through and deliver voluminous audiences through their ad server without having to sync third party cookies.  This gives a leg-up to folks using the Atlas Solutions ad server.

There are companies such as TrueEffect that have popped up that are delivering first party ad serving and media measurement.   This is important similarly to Facebook/Atlas example above.  Other third party ad servers have the ability to serve in the first party but a special agreement has to be formed.

Google and Mozilla are going to be players in this ecosystem beyond what we can imagine today.  Chrome and [Mozilla] Firefox see the majority of the Internet’s traffic and have quite a bit of data that is very valuable to many different stakeholders, inclusive of the consumer themselves.  Recognizing value in that data is something that has not been fully done yet for the consumer and it’s an opportunity for the marketplace.

Companies in the content marketing space have side skirted the conversation around third party cookies but they too are directly affected.  If agencies and/or brands are measuring their content marketing campaigns thru folks like Buzzfeed, Outbrain, Nativo, etc by placing a 1×1 pixel or click tracker, they are essentially measuring the same as a display campaign.  Understanding the impact of third party cookies to the content marketing space is important because measurement directly affects the growth of the space.

First party cookies are not going away, at least in the short term.

That is all, thank you for reading.  You should react in the comments (below) or via twitter.  You can tweet me at @dherman76 and I look forward to responding/chatting.  The cookie conversation is serious and important to this whole industry and I probably missed 50% of all the conversations happening.  The above is not meant to be all encompassing but an addition to the already started conversation that is taking place on sites like AdExchanger or MediaPost or list-serv’s like Harvard’s Project VRM list.

* eMarketer August 2013

** Note, I used many examples of companies in this post.  The only company to my knowledge that I have privately invested in is CrossPixel though might be a shareholder of other publicly traded companies in this post.   There are many companies in the entire industry and I cannot fit each company into each post I write.  If I left your company out, I apologize.  If I miscategorized your company, I apologize as well and get in touch so we can chat about it.

Facebook, Ad Servers, and $344B in Media

There is $344B in media* market cap that own and operate ad serving systems now.  

Google acquired DoubleClick ($274B mkt cap), AOL acquired AdTech ($2.86B mkt cap), and Facebook acquired Atlas ($65.4B mkt cap).  ValueClick owns MOJO and retained Mediaplex ad-server ($2.05B mkt cap).

When we think about ad servers for Madison Avenue, our guts tell us DART and Atlas**.   Both of these two ad serving solutions are now owned by larger-than-life media platforms.  MediaMind, the challenger of ad serving solutions is making inroads across Madison Avenue and believe it or not, has surpassed Atlas as the number two platform.***

Having heard the speculation turned news recently about Facebook acquiring Atlas and reading Gokul’s post on AdExchanger, I still do not understand why they did this acquisition unless Facebook thinks they can convince Madison Avenue to use them as their 3rd party ad serving tool of record.

My question to Madison Avenue:  Wouldn’t you want an impartial 3rd party to be your ad serving tool?  Why would you rely on a media property who is going to make more money off media than ad serving to deliver you your attribution models?

And with this, I’m not saying Google is any better.  It’s a big reason why the majority of our clients are not on the DART ad server.

In the finance world, there is significant rules around proprietary trading (prop desk) and analyst/research work.  The two basically do not intermingle and in the recent laws, the two might have to split.   This is FINRA rule 5280.

(a) No member shall establish, increase, decrease or liquidate an inventory position in a security or a derivative of such security based on non-public advance knowledge of the content or timing of a research report in that security.
(b) A member must establish, maintain and enforce policies and procedures reasonably designed to restrict or limit the information flow between research department personnel, or other persons with knowledge of the content or timing of a research report, and trading department personnel, so as to prevent trading department personnel from utilizing non-public advance knowledge of the issuance or content of a research report for the benefit of the member or any other person.

I understand that advertising is not finance, but wouldn’t we take clues from a more robust industry?

If you are a marketer or agency and put all your media plan data in a company who is selling you millions of dollars of advertising media, don’t you think that the data will be used against you?

Here is an example, purely from illustrious purposes:
Property A – $6/cpm $3/cpa
Property B – $8/cpm $3.50/cpa
Property C – $7.75/cpm $3.40/cpa

Imagine the three properties above have their data in an ad server controlled by Google, AOL, ValueClick, and now, Facebook.

When you go to purchase media from any of these four properties, they can see what you are currently paying and what the actual performance is.

This gives these media platforms a significant leg up on pricing & performance as they know where they need maintain or beat.

Is it just me that’s skeptical?

On a completely other note, I do not run M&A for Facebook but I would have suspected they would have built their own Ad Server and maybe acquired an attribution company such as Adometry, C3 or VisualIQ (or the many others in that space).

* Companies who own significant media properties.  Google, AOL, Facebook, ValueClick.
** There used to be a trade magazine that showed ads served each month by ad server, but I haven’t seen it in a while.  Purely based by my conversations with other agency heads, Atlas and DART are the primary ad servers that come up in conversation.  MediaMind is coming up more and more.
*** Updated after an email conversation with MediaMind.

Cookies, The President, and Ad Tech

There is lots of chatter in the government and the digital advertising industry around privacy and cookies.  You can do a simple Google search and get all the details about self regulation vs. government reform.  I even created a Slideshare document on this back in October 2010.

I wanted to write this post to document something:  if the government steps in to intervene in the privacy and cookie war in the digital advertising industry, lets look at what President Obama used to help win his re-election.

Obama has at least 30 providers of marketing & advertising technology working for him.  Romney as of 12:19PM ET today (11/7/12) has 18 trackers.  This Obama screengrab was taken at 11:55pm ET last night on his official homepage.  Ghostery provided the insight on the right of the screenshot and we can see many cookie-enabled technologies.

Next time you hear about the government coming down hard on cookies & privacy, remember this post.

(This post is not supposed to be a political ding in favor of one party over the other.  I’m one of the least vocally political people in the USA.  It is supposed to provide insight into cookie use for political candidates, in this case, the President Obama.)

 

Measuring Integrated Advertising

I have a lot of respect for Mark Suster, an entrepreneur who turned venture capitalist and now is investing out of GRP Partners.  He writes a terrific blog called Both Sides of the Table and his posts are picked up on TechCrunch and other major outlets.

He recently wrote a declarative post called The Future of Advertising Will be Integrated.  The post went up on April 29th but I’ve been noodling it ever since. Due to some personal obligations, I’ve not been able to respond, but finally, here it is.

As an entrepreneur turned ad agency guy, when I hear the word “integrated,” I immediately think media and creative under one roof, such as my firm, kirshenbaum bond senecal + partners.  I personally believe this is really the only way to go if you want to get to a big platform.  With media and creative all under one roof, under one P&L, and with a cohesive team, you can create big ideas that know no creative or media boundaries.

We have a saying internally at the agency, E=(MC)2, which is obviously repurposed, but it means a “[brand] experience” is exponentially greater when media and creative work together.

Enough agency speak for now but keep this last sentence in the back of your mind as you read the rest.  I hope you do.

Mark came at his post a bit differently and took the above tenants, whether he realized or not, and applied them to the digital media ecosystem today.  He highlighted a few companies such as my buddy Ari’s company, Solve Media, along with Adly and Kontera (amongst others).  The creative is the media in most of these, along with the media being the creative.  I’d argue Paid Search links play here as well.

The Elephant in the Room

One of the largest issues that the digital advertising ecosystem faces today is that we as an entire industry, are not setup to measure the “integrated” nature effectively. Because of this, at scale, this is not a near term reality.  There, I said it.  The elephant is in the room.

The digital advertising ecosystem by default rewards the intent harvesters, not the intent generators.  The primary reason why is that many agencies and marketers are using 3rd party ad serving systems that reward the last click or last action.  In the world of rewarding the last click or action, generally, the ad networks are the ones who win out.  There are 400 (or 700 depending on who you talk to) or so ad networks in the world who have nice businesses.  Just look at ValueClick or InterClick’s financial statements as they are public.  Not too bad.

THE Digital Opportunity

Because of the above, therein lies an opportunity.  If we believe what Mark wrote last week and I’ve been saying for years, then an opportunity lies in being able to create a measurement platform that allows us to understand intent harvesting and intent generation/creation. Piecing together a DART (3rd party ad server) report with a ComScore or Knowledge Networks study is inefficient and frankly, annoying.   There needs to be an evolution here.  This is a big opportunity.

Where We Are Today

Many readers of this blog don’t work in advertising agencies but are awesome entrepreneurs looking to figure out the next big idea to go and tackle.  Being that you are not in the walls of agencies on the daily basis, I thought I’d take the remainder of this post to outline where the industry is in terms of advanced analytics and then open this up for commenting in the thread below.

I highly request that you engage in the comments as group knowledge will benefit the community at large, you might find your next co-founder, and I love open conversations.

Ad Serving:  The Madison Avenue ecosystem basically uses one of three third party ad servers to “serve” and “track” different pieces of creative.  We use Microsoft’s Atlas, DoubleClick’s DART, and MediaMind.  In Q1 2011, we moved the majority of our clients off of Atlas and onto MediaMind because I personally have a strong viewpoint of independence of my ad-server and it’s relationship to media. (should be separate)

Data Warehousing:  This is a relatively new area and somewhat unchartered territory for many agencies.  Many agencies rely on their third party ad-server to be their main data warehouse for tracking. This is good, as you’d be surprised how many people don’t use a 3rd party ad server, but this is not great. Using a full on data warehouse such as VisualIQ, Neteeza, Artemis, or others allows for a larger capability to manipulate data and understand the relationships between touchpoints beyond “last click.”

At the agency, we’ve been using VisualIQ with some of our most progressive clients and the reports and results we’re seeing are fascinating.  One of the biggest questions we’re tackling is “optimal touchpoint analysis” and we’re seeing the relationships between display, video, search, social, and beyond.  We can now determine a value to each one.

Brand Lift Studies:  While I’ve argued time and time again, that “brand” advertising for the sake of brand advertising online is dead, many marketers continue just spending on “brand.”  Agencies use 3rd party brand study vendors such as ComScore, Knowledge Networks, Vizu, and others that help measure the “lift” (or change) associated in any one of many categories including but not limited to awareness, intent, and consideration.

Opportunities

·     The basic ideas behind today’s ad serving systems were conceptualized in the mid to late 1990s.  Online video, social, search, etc were not around then.

·     Product placement and integration into online video and social are hard to quantitatively measure with a 3rd party ad serving system as the only metrics you can pull back to your ad server are by using a click-tag.

·     The Display ecosystem is being fractured into traditional display (i.e. banners on ESPN) and social display (i.e. creative/textual units on Facebook, LinkedIn, etc).

·     I see Paid Search and Display converging on each other within the next 12 months. In some cases, they already are: Google Content Network.

·     I challenge you to ask your 3rd party ad-serving vendor to recommend an attribution model – report back what they tell you.  Not much – there is no standard yet.  It’s unchartered territory.

Next Steps

I would obviously love to hear your feedback.  Please post it in the comments section below or shoot me a note.  I believe that we won’t see large integrated opportunities that get their portion of the measurement/attribution credit until there is a way to measure these.  While we might try one or two of these integrated opportunities on each media plan, if you ask the agency how they really performed, the agency won’t have much to tell you because the tools for measurement are ancient.  With the data warehouses mentioned above, we get much better, but not perfect.

While we don’t need perfect to make the industry move forward, we do need better tools.  If you are building them, I’d like to speak to you.

Don't Let QR Codes Go the Way of RSS

I’ve been wrestling with QR codes lately as both a consumer and advertising agency executive.  I’m a bit scared they will go the way of RSS feeds.  Let me explain a bit.

I don’t know what to do with a QR code, and I don’t think mainstream America does either.  I’m being a little dramatic here, but you get the idea.  Do you need a specific QR reader?  Do you need to text the code somewhere?  Do you cut it out and mail it somewhere?

A QR code is a good idea – append a unique image to a print, billboard, or other campaign and entice the user to scan it in for some form of value exchange (ideally).  The brand that is using the QR code can now measure response of that particular media vehicle.

I’ve seen far too many pieces of creative that have a QR code on them, but do not have a call to action or instructions for the user to figure out what to do with it.  It’s almost like an orange RSS icon that sits next to content on the web without any instructions.   While I imagine that the “Techcrunch-crowd” knows what RSS is, I’d gather that most Americans don’t know how to setup feeds and readers and the utility and value of RSS is not being recognized fully by the masses because of this.

I’m worried that QR codes might go the way of RSS feeds. Without education to consumers about what to do with them, they are worthless – they take up space on our marketing collateral and are generally pretty ugly.

So who will educate?  Will we see the creation of a trade association to take out a broad-reaching QR awareness and education campaign?   Or, will we see brands who utilize these codes educate their audiences on their marketing collateral.

I do not know where this will net out, but it needs to be figured out.

Marketing measurement is here to stay and this is one way that we can further prove ROI.

Cookies & Milk

As collecting, aggregating, synthesizing, and analyzing data is becoming a very important part of advertising (today on the web, tomorrow across all channels), understanding cookies is a must.   Avinash Kaushik, the Analytics Evangelist at Google has written a fairly comprehensive review of cookies.  You should probably read it.