by Andy Atherton
February 12th, 2010
Just a quick post to go “on the record” in the context of the recent AdExchanger threads (1 and 2) defining/discussing “Demand Side Platforms” (DSPs).
I agree with those who indicated it is way too early to lock down a narrow definition of DSP. Arguably anything that’s really a “platform” should never need a description that’s as detailed as the list offered in the first post, but regardless its definitely too soon in this particular market.
At this stage I think all are better served by a more general definition. Fundamentally, I think any entity that meets the following criteria with sufficient breadth of capabilities is a DSP:
- Technology that interfaces directly with demand-side entities
- “Interface” does not necessarily mean GUI. An API could be even more useful if it meets the customer requirements
- Demand-side entities may include agencies and/or advertisers
- Technology that adds significant value in the process of buying and/or management of media
- Value could originate from data integration, forecasting, buy automation or other operational efficiency gains, supply source integration, delivery and/or pricing risk management, increased ad effectiveness through optimization, impression filtering/categorization
- Etc., etc., etc…
- Technology that operates as directed by the demand side entity (i.e., the customer)
- The technology can be used flexibly and transparently by the customer in a way that benefits its business, with limited incentive conflicts
Obviously, technology is the common thread; DSPs will compete on the strength of their technology and networks with weak technology (essentially bucket shops, substituting people and excel for real technology) will find themselves increasingly squeezed between DSPs and exchanges.
One final point: “platform” implies broad capabilities. Many companies exist with valuable capabilities that meet the above criteria, but that couldn’t properly be called platforms. I would suggest that Demand Side “Tools” (DSTs?) is probably more appropriate for more narrow capabilities. These tools may be used directly by demand side entities and/or be packaged by DSPs.
by Andy Atherton
January 18th, 2010
Just a quick post to make sure folks saw Richard Frankel’s article today on AdExchanger.
A couple solid, related tidbits in there.
The first point is about attribution. Richard cautions that retargeting often “steals” attribution from other tactics unless careful steps are taken to prevent it from happening. DR tactics stealing attribution from upper-funnel tactics is an important topic on which we have written before. As we mention in that article, it’s also the subject of an entire body of work by Microsoft’s Atlas Institute.
The second point is about the importance of finding new prospects and customers, not just retargeting old ones. This difference between “demand creation” and “demand fulfillment” (as Forbes.com’s Jim Spanfeller has somewhat famously put it) is something that needs to be understood and carefully considered when developing a comprehensive marketing and media strategy.
As online media marches past a 30% share of total media consumption, new technologies are eroding offline media like TV and print. Both demand fulfillment and demand creation budgets alike must follow consumers online.
by Andy Atherton
December 29th, 2009
PR experts use a trick when they need to release news they really don’t want covered broadly, peer reviewed or scrutinized. The trick: drop the announcement when everyone is focused on other things. The Friday afternoon before a long weekend and the last business day before a major national holiday are prime dump days. The Bush White House used this tactic to announce Koran abuse at Gitmo and the indictment of Scooter Libby. Celebrities routinely use it to announce divorces or rehab stints.
And on December 23rd, just as the media world shut down for Christmas, Double Verify (DV) used it to announce its new “BrandShield” solution. Of particular note in DV’s release is that it seems to imply (the wording is quite cagey) that DV can perform page-level quality filtering on “nearly 100% of impressions”, even when ads are served within iframes, by effectively “seeing through” the iframes to determine “which…page the ad is actually delivered on”.
Taken at face value, this sounds like a huge advance in page-level quality filtering technology, which obviously requires page-level visibility to work. However, regular readers of this page will remember our recent post on the problems posed by iframes for 3rd party page-level filtering. Specifically, that “seeing through” iframes is impossible for an ad buy – like the vast majority of ad network buys – the composition of which is not known in advance.
So why would a (to date) publicity-hungry startup like DV announce seemingly ground-breaking technology in a way that recalls the indictment of a senior White House staffer? The only reason I can think of is that this announcement amounts to either a) an admission that DV is using the methods of hackers to exploit holes in browser security and enable collection of data that all commercial browsers prevent for important privacy reasons or b) a clumsy and misleading attempt to confuse the market about what is technically possible.
The former would raise extremely troubling privacy concerns, particularly against the backdrop of increased scrutiny on collection of user data for BT. The latter is obviously not particularly comforting either, but at least it doesn’t open unsuspecting agencies and brands up to PR backlash, consumer lawsuits and/or government sanctions. Either way, prospective DV clients considering this solution should ask tough, direct questions about how this apparent iframe miracle is performed before touching it with the proverbial ten foot pole. Specifically, buyers’ technical staffs should seek to understand clearly and precisely how each page in an ad buy would be conclusively identified and filtered, including each page where the ad is displayed within an iframe. As I mentioned above, be sure to consider the case where the composition of the buy is not known in advance, like most ad network buys.
Rest assured that we will be working with our agency partners to fully explore these claims and will share whatever facts we uncover on this page. Please feel free also to share with me anything you know or find out. As we set about that work (or at least until DV is good enough to clarify their release), I would renew my call for a New Year’s resolution: let’s elevate the dialog from misleading marketing claims to honest discussion and execution of the cutting edge solutions that sophisticated clients demand and deserve.
by Andy Atherton
December 15th, 2009
Catching up on my inbox, I noticed an interesting article from Undertone’s Alan Schanzer last week on AdExchanger. Credit to Mr. Schanzer for trying to help media buyers differentiate between networks; it’s a crowded market with lots of overlapping claims and capabilities. Unintentionally, however, his article does more to clarify how little first generation ad networks can do to maintain media quality and protect clients’ brands than it does to provide useful advice for the media buying community.
Mr. Schanzer claims that, “when selecting a network, business practice transparency is far more important than site transparency” and focuses the reader on two bad business practices that site transparency does not prevent: URL padding and daisy chaining. He’s correct of course that site transparency doesn’t address either issue. But it’s not exactly news that lying about site breadth or buying in a completely uncontrolled manner are bad business practices. If avoiding them is even enough to be table stakes then it’s a low limit game. Sophisticated buyers demand (and get) a lot more from their most important partners, and have for years.
Mr. Schanzer is 100% correct that, “a site list alone will not protect your brand”. But he doesn’t get down to the real threat to your brand: objectionable content. Nor does he discuss the fact that objectionable content is not just a site-level (publisher) problem, it is a page-level problem (i.e., there are pages on the very best publisher sites that have objectionable content, which can arise in an instant by way of user generated comments) and because it is a page-level problem it takes serious technology to solve. That’s why Brand.net has invested millions of dollars over the last 18 months in our pioneering page-level filtering platform, SafeScreen, which launched in Q109. That’s also why I wrote a detailed article for iMedia in September on the criticality of ensuring quality at the page-level and posted a more recent follow-up that discusses some major problems with emerging 3rd party technologies that claim to address this issue.
Having said all of that, I am surprised that late in 2009 Mr. Schanzer would want to draw attention to the weakness of a site-based approach to managing quality. Particularly when Undertone’s quality “guarantee” is framed 100% in terms of site selection. Read it carefully. Undertone does not guarantee that it will keep clients’ ads away from objectionable content. It merely guarantees that clients’ ads won’t run on a site that is not certified as an Undertone Quality Publisher (UQP). This commitment is almost meaningless because (at least on this page) UQP is undefined outside of a few vague criteria. As written, Undertone could call a “professionally produced and aesthetically desirable” porn site an UQP and not payout under the “guarantee”.
Of course Undertone would not act in such bad faith, but by framing its quality “guarantee” in terms of site selection and saying nothing about page-level quality, it reveals either a fundamental misunderstanding of the key quality issue that sophisticated media buyers are focusing on today, or the lack of technology required to deliver a best in class solution. It’s pretty clear it’s the latter, because at the bottom of the same page the fine print specifically and explicitly carves out a safe harbor for ads that end up next to objectionable content on pages of UQPs. In other words, Undertone is saying that if they place your high end beauty, food product or premium diaper ad next to the F-word (or worse) in a user comment that appears on a top women’s site, they’ve successfully completed their job as your media partner. At Brand.net we certainly wouldn’t want to try to explain that to one of our customers and SafeScreen means we won’t have to.
I propose a New Year’s Resolution for the industry: let’s elevate the dialog from trading marketing claims of little or no practical utility to active discussion and execution of the cutting edge solutions that sophisticated clients demand and deserve.
by Andy Atherton
December 14th, 2009
Some quick comments on this morning’s Ad Age article on CBS stepping away from networks. The “publishers vs. networks” issue has ebbed and flowed pretty consistently since I started in this business at Yahoo! in 2002. It seems to ebb when revenue is scarce and flow when demand picks back up, with clear evidence of both trend and seasonality. There is obviously some rationality to this pattern, but I have always thought that the “turn ‘em on, turn ‘em off” approach is a blunt instrument that doesn’t serve publishers, particularly in the long term.
For example, in this article, CBS draws a distinction between the third party networks they are turning off and agency-owned networks (e.g., Vivaki) with whom they will continue to do business. As Michael Zimbalist of NY Times points out in another recent article, from a publisher perspective these agency-owned entities have a lot in common with third party networks. So it’s unclear how leaving them “on” makes sense if the best solution for third party networks is “off”.
Apart from this inconsistency, two other big issues with the on/off approach are lack of resolution and poor responsiveness to dynamic market conditions. While networks overall may monetize at a lower rate than direct sales efforts, certain networks will be more or less competitive for certain inventory (resolution) and at different times (dynamics). RTB was designed to address these two “hard coding” issues (amongst others), but neither AdX 2.0 nor Right Media are close to ready to be relied upon as sole indirect demand channels. Internal agency network efforts are still nascent as well. The bottom line is that vastly more demand still flows through third party networks than through of any of these channels.
So rather than bowing out of a significant majority of the quickly evolving ad ecosystem, I think the right publisher solution is a framework that coordinates direct and indirect sales efforts to create the competition for inventory that drives maximum revenue for the publisher. Based on my long experience at Yahoo!, I laid out the broad strokes of such a framework in an article for MediaPost earlier this year. Publishers that learn fastest and best how to apply such a framework in their particular circumstances will achieve levels of monetization that increasingly distinguish them from their more isolationist peers.
None of us is as smart as all of us; the key to staying on the cutting edge of monetization is coordinating the best efforts of both direct and indirect channels on a dynamic basis. Today and for the foreseeable future, third party ad networks are an important part of that picture.
by Andy Atherton
November 24th, 2009
Just a quick note pointing to a short, but interesting post today that echoes my recent article in Ad Age. Clearly Pete Kim and whoever he was talking to understand that it’s not all about DR. Kudos to them.
Again, today’s re-energized battle for display is just warming up. The long-term winner will be the one that provides brand-focused capabilities on top of the evolving supply platforms to help brand budgets follow audiences online.
by Andy Atherton
October 29th, 2009
Nice short piece this AM from Peter Kafka of allthingsd re: Microsoft’s plans to enter the Exchange 2.0 landscape with a re-tooled AdECN. Very much in line with my post earlier this week in Ad Age. As I wrote, the next 12-36 months will be interesting indeed…
by Andy Atherton
October 27th, 2009
I thought readers of this blog may also be interested in my guest post for Ad Age, where I give a brief history of the evolution of the display advertising exchange ecosystem and suggest what I believe is the next step. This post for Ad Age follows up on my previous post here.
As always, let me know what you think!
by Andy Atherton
October 9th, 2009
An article in today’s eMarketer nicely summarizes some recent comScore / Starcom USA research showing that fewer and fewer users are clicking on ads and those clicks are concentrated in an ever smaller share of the user base. Not good news for fans of CTR as an “optimization” metric – and there are still too many of these.
The article includes a priceless quote from John Lowell, Starcom USA SVP and director, research and analytics, “A click means nothing, earns no revenue and creates no brand equity. Your online advertising has some goal—and it’s certainly not to generate clicks.” Don’t mince words John. Tell us what you really think. We’ve seen the same with our own offline sales measurements, by the way. CTR is not even remotely correlated with offline sales lift or associated campaign ROI. Here’s an example of the lack of correlation from some recent campaigns:
Reading Lowell’s quote and considering the fact that this is still even a topic for discussion reminded me of Monty Python’s famous Parrot Sketch.
Advertiser: “I know a dead metric when I see one and I am looking at one right now.”
DR Network: “No, no it’s not dead. It’s just resting.”
by Andy Atherton
October 8th, 2009
Another tremendously insightful article yesterday from Michael Zimbalist of NYT. This guy is sharp. His analysis of the situation is dead on and I completely agree with the rough bucketing of potential outcomes and associated implications for the various ecosystem players.
However, I want to make it clear that the key to Zimbalist’s positive outcome scenario (scenario 3) is the emergence of capabilities that aren’t widely available today. As Dan Ballister wrote in his comment to the article, “If buyers are going after audience in real-time auctions, will they make peace with having to forfeit control over ad environment and delivery predictability? What good is it to reach your audience when they don’t want to be found, or to only run 15% of your back-to-school campaign on time because you kept getting outbid?”
Well put.
In order for Brand marketers to fully leverage the emerging exchange ecosystem they will need sophisticated technology for page-level quality filtering, pricing & delivery prediction, R/F & composition management, delivery smoothing, offline impact measurement, etc. In case it’s not obvious, that’s a very different toolset than the fine targeting and CPA-driven optimization engines of which the market has produced scores of copies thus far – on both the demand side and the supply side.
Stay tuned for some more in depth thoughts on this topic shortly.
