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IPG Media Lab: 2014 Means Mobile-First, Data-Driven Experiences

IPGMediaLabThe IPG Media Lab is a media test kitchen for parent company IPG Mediabrands. Every week, the tricked-out tech playground plays host to CMOs and brand strategy execs that walk its aisles for inspiration on emerging devices and media-types to augment in their marketing strategies.

Through a series of informal relationships with media and technology startups the as well as more formalized partnerships forged with large enterprises like ABC and Clear Channel Communications, any client of IPG’s media agencies UM, BPN and Initiative is essentially a client of the Media Lab also.

AdExchanger sat down with Natalie Bokenham, director of strategy for the IPG Media Lab, to talk about key trends among brand clients as part of our 2014 look-ahead series.

AdExchanger: What’s one of the top trends the Media Lab is tuned in to for 2014?

NATALIE BOKENHAM: It’s the year [the] personal data consumers are sharing about themselves will ultimately create a rewarding experience for consumers. I think communication will become a lot more personalized. Google Now is a great example. It’s a feature on the Android operating system that sends you personalized messages related to where you are and what you need to be doing in the next few hours based on things like current traffic conditions and weather conditions or mashing up a ton of public and personal data to serve you the most relevant possible messages. You can’t advertise yet on Google Now, but consumers are getting used to receiving messages in this way and we think brands will need to think about delivering messages in a timely, relevant way that’s data-driven.

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The Creativity Is In-House, But The Technology Is Not

BBDOartA change has happened among creative agencies in which they’re now using cloud-based solutions to develop their in-house creative ideas.

Part of this has to do with the changing demands of business clients and the growing acceptance of crowdsourced content for marketing purposes.

“Agencies are now being tasked with delivering high-quality content at a price that’s relevant for 2014 in a world where the average shelf life of a video is now less than two weeks,” said Nick Pahade, CEO of social video marketing platform Poptent. This imperative alters the brainstorming process and time frame behind creative briefs. Pahade spent the majority of his career on the agency side, most recently as North American CEO for IPG Mediabrands’ Initiative.

This shift has been gradually developing. Ten years ago, crowdsourced and consumer-generated creative content started to take off and, soon after, viral YouTube video stars became viable threats to brand-approved and agency-created content. Only now are agencies beginning to embrace this change.

“I think, on a macro level, you see a fear of these crowdsourced models [and now, the same could be said about marketing tech and SaaS] but the way we look at it from an agency perspective is, as an industry, you have to evolve,” said Scott Schraufnagel, an account lead for advertising agency BBDO Proximity Minneapolis, which works with a number of brands ranging from Hormel to Schwan’s. “Twenty years ago, it was the same thing [when talk focused on what the] Internet would do to TV.”

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China Holding Company BlueFocus Goes West, Buys London's We Are Social

we-are-social-robin-grantBeijing-based BlueFocus Communications has bought a majority stake in We Are Social, strengthening its Western presence and gaining a global social marketing capability.

Under the deal terms, BlueFocus paid an initial $30 million for an 82.8 percent position in We Are Social, with additional incentive-based compensation doled out over the next three years.

London-based We Are Social employs 400 people in eight offices, including a New York presence that opened two years ago. The firm is focused on social marketing consulting and content development on behalf of clients such as Mondelez and Heinz.

It also has a young paid-media practice, launched in January 2013. Managing Director Robin Grant conceded it's hard to pry media spend away from dedicated media agencies, which have a lock on many clients' social ad budgets.

"It's hard work," Grant said. "A lot of brands have big global deals with one of the big media agencies, and they're contractually bound into the deal. For those willing to take the chance, we're getting great results."

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Wunderman, MEC’s Data-Driven Debut A Hat Tip To Agency Evolution

ChoreographArtWPP Group’s digital and direct marketing agency Wunderman and its media-buying agency MEC have launched a joint venture called CHOREOGRAPH to address converging client demands in paid, earned and owned media.

The proliferation of cross-channel marketing campaigns and the subsequent need to marry transactional, customer and demographic data with audience-level information drove CHOREOGRAPH’s creation.

“Over the last year, we saw more RFPs and expression of interest from clients for a media, creative and data proposition,” said Gurval Caer, Wunderman’s chief innovation and marketing officer, who was also appointed CHOREOGRAPH’s president for the US.

“It was pretty impossible for us not to at some point come together and offer a complete picture of the media landscape to our clients.”

Caer pointed out that good content generates interest on social media, which can, in part, be amplified via paid media. Unifying these different assets requires a clear picture of the end consumer – something that CHOREOGRAPH was designed to provide.

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WPP Sticks With Tech Ownership Strategy As Xaxis Buys Crystal Semantics

xaxis-crystalWPP Group’s 24/7 Media – which will soon be absorbed into Xaxis – has acquired 12-year-old semantic ad-tech company Crystal Semantics and its 15 employees from previous owner Ad Pepper Media.

London-based Crystal's technology can be applied a few ways, said Rob Schneider, 24/7 Media's SVP of corporate strategy and platform development.

First, it offers straightforward contextual analysis by categorizing content according to meaning. That product is licensed to a number of publishers and ad network partners. Second, that same contextual technology can be applied for audience modeling purposes, by identifying content associated with a user's browsing history. Xaxis aims to focus on this purpose to augment its audience targeting engine. Finally, Crystal has a "brand safety" angle – allowing advertisers to avoid appearing adjacent to objectionable content.

"There have been amazing advancements in the last three years with regard to increasing the efficiency and effectiveness of how digital advertising is bought and sold. One area that has been neglected, to everyone's chagrin, is the experience of the Web and the value of content," Schneider said. "We're excited about getting this proven semantic technology into our core platform to inject context and content classification in a programmatic way at scale."

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2014 Forecasts: Global Ad Dollars Surge, Driven By Mobile, Social

Ocean of Ad DollarsPublicis Groupe media shop ZenithOptimedia and its rival, IPG’s Magna Global, predict the global growth of ad spend through 2016 will come from a number of new channels – namely more dollars allocated to mobile and social buys as well as the penetration of programmatic in more countries.

Mobile wave: While analysts have predicted that every year over the last decade would be the "year of mobile," as of 2014, those cheerleading the rise of advertising on smartphones and tablets can feel much more comfortable making that claim, according to ZenithOptimedia's latest forecast.

Although mobile constituted just 2.7% of the global ad spend in 2013, Zenith anticipates that share will rise to 7.7% over the next two years -- becoming the fourth largest ad segment, ahead of radio, magazines and out-of-home.

"This the first time in the past 20 years that a new platform is expanding overall media consumption without cannibalizing any of the other media platforms," Zenith's report states. By itself, mobile will fuel 36% of all new ad spending through 2016, slightly ahead of television. Mobile and television are increasingly intertwined, as shown by partnerships such as Nielsen's audience measurement deal with Twitter, as networks and marketers try to get a better read on what sort of messages resonate with young viewers.

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Accuen's Jun Yuan Talks Challenges Of Trading Desks In China

Jun YuanOmnicom Media Group's trading desk, Accuen, has expanded its reach in the BRIC countries over the past year, and Jun Yuan, head of Accuen China, is navigating the unique challenges of the market.

"As an agency, we started our RTB business in China last year, in April," Yuan told AdExchanger, noting that the team is now 18 people. " For every trading desk, it takes at least a half a year to understand how to run a business in China and make the business sustainable and customize the solution for China clients."

Yuan spoke to AdExchanger about the benefits and challenges of working as part of a large holding company in China, and how clients and publishers there are responding to growth in RTB.

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WPP Group's Xaxis Imbibes 24/7 Media, Gaining A Sell-Side Edge

xaxis-lesserIn 2007, that WPP Group made big waves with its acquisition of display media technology firm 24/7 Media, worth $649 million. By bringing a publisher-facing ad server and network in-house, the holding company had staked out a tech ownership strategy that continues today.

Today that premise lives on at WPP, but the 24/7 Media brand does not. Going forward, the tools and publisher relationships formerly grouped under the 24/7 name will serve as the sell-side underpinnings of Xaxis' platform, supporting CEO Brian Lesser's vision of a programmatic buying company built on thousands of direct connections to media companies. (Read the release.)

Not coincidentally, the absorption of 24/7 Media into a programmatic framework comes as another traditional publishing network, ValueClick Media, prepares to "go programmatic" with a name change and demand-side platform (DSP) of its own.

Brian Lesser talked with AdExchanger about the future of Xaxis.

AdExchanger: What's the rationale for Xaxis absorbing 24/7 Media?

BRIAN LESSER: Xaxis has always been a much broader business than a trading desk. Our products are focused on acquiring inventory directly from publishers -- quality inventory that we can append to data that we've created in our DMP (data-management platform). And then we offer audiences that perform well against an advertiser's objectives, be they performance or branding objectives.

Within that, technology is incredibly important. And not just technology on the demand side. Technology on the supply side has become just as important.

It makes perfect sense to merge 24/7 into the Xaxis brand so we can offer advertisers and publishers a global programmatic media platform.

Does this effectively turn 24/7 into an SSP? And does Xaxis effectively become an ad exchange?

I wouldn't call 24/7 an SSP (supply-side platform) and I wouldn't call Xaxis an exchange, but I would say we now have more pieces in a total platform that can directly connect advertisers to publishers.

When I talk to our advertiser clients, they're frustrated that although automation has made things more efficient, it has abstracted what they're buying from publishers. And when I talk to publishers, they're frustrated that automation hasn't meant that they can sell their premium inventory at better rates to better quality advertisers. Part of that is because there's too many small players – DSPs, SSPs, ad exchanges. Advertisers and publishers simply want to connect more directly.

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A New School Of Consultants Swims Upstream

consulting-advisorsConsulting businesses are popping from the foliage like so many munchkins in Oz, eager to guide bewildered marketers – lost, perhaps dealing with head trauma – through a fragmented and hallucinatory media landscape to the yellow-brick…well, you get it.

Last month, Starcom MediaVest Group took the wraps off a new advisory business called Zero Dot. The unit consists of six consultants who serve up consumer-driven insights for SMG clients like Kraft Foods and Beam Inc. The move echoed the March launch of GroupM Consulting Services, another practice incubated within a holding company's media agency arm.

The idea in both cases: Leverage the media agency's close familiarity with publishers and device types to drive consumer insights and campaign concepts for the available ad formats. That's something creative agencies have struggled to do as digital media has splintered.

"The definition of 'big-c' creativity is in need of renovation back down to 'little-c' creativity," said Jonathan Hoffman, who helms Zero Dot while retaining his regular duties as president for experience design at SMG. "What comes to us from SMG is native objectivity and a horizontal bandwidth in terms of where people are, how they're behaving and how most gracefully to coincide with their experience."

Sundar Raman, Procter & Gamble's marketing director for North American fabric care division, turned to Zero Dot for help with a Hispanic-focused campaign idea that integrated mobile phones with television ads.

"In my mind context will be king, along with content, in the future. Context is determined by media agencies today and content is in creative agencies today," he said.

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India-Based Vizury Targeting Digital CRM In Asia-Pacific Region

vizuryWith his company’s roots in lead generation, Vizury CEO Chetan Kulkarni is unequivocal about the importance of first-party data and the value it can create for advertisers.

But, before one can begin using first-party data effectively, Kulkarni suggests defining it.

“Let's say we're talking about a transaction – for first-party data, you need to ‘map’ backwards from the transaction in terms of what sort of data is being used to predict the transaction, not influence the transaction. When you do, you see a few things. First, recency and depth of the visit to the website. Second, the transaction history that the user carries with the advertiser. For example, a user has a propensity to engage, explore, and buy a particular product or a particular brand.

“The third thing you see is the propensity to respond to ads – this is a great indicator of whether the person is going to transact. So, when I say first-party data or data in general, I mean those three signals.”

India-based Vizury was co-founded in 2008 by Kulkarni, COO Gourav Chindlur and CTO Vikram Nayak. The company has raised $11 million in venture capital from investors such as Nokia Growth Partners and is approaching 200 employees.

With headcount expected to double in the next year, and APAC revenue continuing to drive results, Kulkarni positions Vizury as a digital CRM company rather than an agency or tech company.

“When you think of the traditional off-line world of CRM, it performs two functions," he said. "One is to capture data from interactions in a showroom or on a phone call and so on. The second function is to help advertisers power their marketing conversation in a one-to-one way and across various channels. A text message or a phone call or direct mail may be a channel. This is what the traditional CRM systems do, and the end marketing goal is to maximize lifetime value. That's the holy grail for any CRM system.”

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