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Digitas, Media Contacts, Razorfish Talk Ad Exchanges At Search Engine Strategies

Today, Day 2 of Search Engine Strategies NYC, featured a collection of agency executives who discussed the current online display advertising market in a panel titled, "Pardon My Reach: A Snapshot of the Display Ad Marketplace."

With AdExchanger.com's focus on ad exchanges, this was an opportunity to learn about agency opinion and innovations as it related to ad exchanges.

For now, it appears agencies see ad exchanges, at best, as little more than an opportunity to retarget in the broadest sense, and suggest that clients remain queasy about the new, transparent marketplace.

The panel was moderated by ClickZ Managing Editor, Zach Rodgers and included:

• Chris Paul, VP, Media Director, Digitas
• Sarah Baehr, Vice President and National Media Lead, Razorfish
• Adam Kasper, SVP, US Director of Digital, Media Contacts Boston

As the hour long panel, crisply led by Zach Rogers, turned to the subject of ad networks and exchanges, Sarah Baehr from Razorfish suggested that there were too many ad networks and not enough of a differentiation, adding:

"One comes out with 'we're using BlueKai', or 'we're layering Experian', or 'we've got this great new targeting thing.' If you start to layer in the fact that premium publishers are starting to regroup their own inventory, it starts to pick apart the value that ad networks can bring to you. Then you've got the whole other layer of ad exchanges which is pressing down on ad networks. There just isn't much of a differentiation and (it comes down to) relationship, the value brought as a partner, flexibility and performance."

Chris Paul of Digitas seemed to have the most positive outlook on exchanges saying:

"Ad exchanges have definitely changed media buying. As the importance of retargeting grows and the value we see on the backend versus our best guess. Those exchanges that allow us to pick and choose based on cookie we want, it's audience on demand."

Adam Kasper of Media Contacts Boston said that ad exchanges haven't had much of an impact yet and noted:

"I think we're still very much in an education process with clients about approaching ad exchanges. We're out there in every ad exchange. Industry prediction says 40-60% of inventory will be sold through exchanges three years from now – we're not even close to that. We're still doing more direct publisher relationships even if its networks and that sort of thing."

In response to a question about client resistance on ad exchanges, Media Contacts' Kasper suggested the lack of adoption by clients has less to do with outperformance by direct publishers than the fact ad exchanges are currently a "hard sell" to clients.

Kasper added:

"There's an additional layer of uncertainty there that clients are not real comfortable with. As we start to be able to retarget users based on cookie data that we bought through exchanges and other data vendors, and it starts to prove itself out, you're going to start to see more of acceptance."

Other notes:

• There was general consensus that Yahoo!'s APT Platform was not quite "to scale" and once Blue Lithium's inventory and some others got folded in, it will be a better platform to buy from.
• Adam Kasper from Media Contacts also reported that their partnership with Media6 which started last month and allows them targeting capabilities within social media is good in its initial stages but is still "TBD" over the long term as the campaign(s) have not had enough time to perform.

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