With Display In Decline, Marketers Are Searching Elsewhere

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peter-davies"Data-Driven Thinking" is written by members of the media community and contains fresh ideas on the digital revolution in media.

Today’s column is written by Peter Davies, chief revenue officer at ROKT.

Digital is constantly changing. The promises of programmatic Internet display advertising are not being fulfilled, according to my conversations with marketers around the world. As a result, marketers are looking to reallocate budget to alternative digital channels where effectiveness and conversion rates are higher and more transparent.

That’s not to say that display is dead. It won’t die any time soon. Internet display advertising will overtake paid search for the first time in 2016, predicts Zenith Optimedia. Programmatic marketing and automation drives this growth as businesses seek the marketing nirvana described as “one-to-one marketing and storytelling at scale” by Dennis Buchheim, Yahoo’s vice president of product management.

Unfortunately, progressive marketers realize programmatic display – at least in its current form – is not the pathway to this nirvana, despite the industry hype and raft of investments in technology and systems over recent years. There are four reasons why, including consumer behavior, bottom-of-the-funnel metrics, a lack of transparency and the cookie issue.

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Harper’s Bazaar Pursues Shoppable Ads With Streamwize

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Harpers and StreamwizeFor publishers, the holy grail is to “engage, interact, and convert without leaving site,” according to Gary Portney, founder of Streamwize. Advertisers get their conversion, and publishers keep their consumer on-site.

That’s why ShopBAZAAR, the ecommerce presence for fashion magazine Harper’s Bazaar, decided to license Streamwize’s “fractal content,” technology which creates browsable boxes on a website for deep in-page engagement with brands.

ShopBAZAAR is “a convergence of pure editorial content and commerce,” described Anne Welch, associate publisher and general manager for Harper’s Bazaar, who focused on the ecommerce site.

In the magazine, items tagged with a “B” signify they can be purchased on ShopBAZAAR. As part of an advertising buy, brands can purchase placements in the print magazine, the digital version or as dedicated boutiques on ShopBAZAAR. These “dedicated boutiques” are sold like advertising for a flat fee, not through a revenue-sharing agreement.

The women’s clothing brand J.McLaughlin was the first to try out the dedicated boutique using Streamwize. Compared to its boutique the previous year without Streamwize, average time on the J.McLaughlin page increased 36% year over year. The increase in page views per entrance, defined as the number of clicks after a user first engages with the Streamwize box, was 80%.

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Crosswise Is The New Cross-Screen Kid On The Block

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SteveGlanzMultiscreen tracking company Crosswise, which on Thursday launched its cross-device identification solution, doesn’t care about buying media.

It doesn’t care about creating segments. Basically, Crosswise CEO and co-founder Steve Glanz doesn’t care if you’re a man or a woman, how old you are or where you live — at least not as isolated data points.

“We’re not creating profiles of users, we’re looking for connections between data points,” Glanz said. “We’re trying to solve the problem of being able to identify users across devices employing a statistical or probabilistic solution.”

While that might ring a bell for anyone familiar with cross-device ad tech companies like Tapad or Drawbridge, Glanz said Crosswise’s product differentiates since it’s a “data-only” solution that isn’t interested in direct agency or brand relationships.

Glanz said Crosswise competitors are both technology providers and perform media services, creating a conflict. Crosswise, which has raised $2 million from several VC sources since its August 2013 founding, is by contrast a pure-play technology company. It hands the fruits of its data tracking over to demand-side platforms (DSPs), which then work with agencies and brands to buy the right media.

“Tapad and Drawbridge are great companies, but they’re also basically competing with every DSP and retargeting company,” he said. “They license their platform to ad tech companies and also try to sell direct campaigns to agencies and advertisers at the same time."

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Geotargeting: Let’s Get Critical

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lorrydestainville“Data-Driven Thinking" is written by members of the media community and contains fresh ideas on the digital revolution in media.

Today’s column is written by Lorry Destainville, product development director at Glow.

I used to be a geoskeptic. This is an industry term I just invented.

Advertisers used to approach me breathlessly thirsting for geotargeting across their campaigns. I’d ask them with arched eyebrow, “Why? In all honesty, I’m not sure I see added value in layering national campaigns with geospecific targeting.”

What I got to see next were several pairs of disappointed puppy eyes. The puppies wanted to geotarget.

So I asked myself: Why is everyone talking about geotargeting? It was time to dig out my scuba suit and deep dive into the hype.

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Amazon Offers Self-Serve; AudienceScience Releases Supply-Side API

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amazon-ponyHere's today's AdExchanger.com news round-up... Want it by email? Sign-up here.

Amazon Automates

Amazon debuted a self-serve ad-buying tool on Wednesday, and VivaKi is the first in training to trial the offering (although the Publicis-owned agency has yet to run a campaign). Amazon plans to extend the tool to "select" agencies, but for the time being it only has eyes for VivaKi. Amazon exec Seth Dallaire tells Ad Age, "We chose them as the launch partner for this exercise because we recognize they have a lot of experience in the programmatic media space.” Both Amazon and VivaKi declined to comment on a definitive timeline for extending the offering or launching the first campaign. Read more.

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TripAdvisor Misses Q2 2014 Estimates — But At Least Ad Revenue’s Up

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TripAdvisorearningsTripAdvisor painted a muddled picture during its Q2 2014 earnings call.

The travel booking site’s overall profits came in far below estimates. But ad revenue was a bright spot for TripAdvisor, which saw an increase in both click-based and display ad revenue this quarter.

Click-based ad revenue increased year over year to $235 million, up 28%, while display revenue grew 19% to $37 million.

The company’s CFO Julie Bradley attributed the uptick in click-based revenue to “strong CPC pricing for meta search leads.” (In February of last year, TripAdvisor had rolled out what it refers to as “meta-search,” a Google-inspired feature that eschews the “pop-under” ad format in favor of serving search and display results with the hope of raising both the quality and prices of its display ad offerings.)

Total revenue for Q2 2014 was $323 million, a year-over-year increase of 31%, meaning click-based revenue accounted for 73% of its total second-quarter revenue. Interestingly, that percentage was down just a smidgen from Q2 last year, when click-based revenue represented 74% of total revenue.

The same was true on the display side. Display-based ad revenue comprised 11% of total revenue this year versus 19% last year.
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Marketing Services A Bright Star For Neustar Q2 Amid Contract Black Hole

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neustar q2Communications infrastructure provider Neustar is in the midst of a change, one reflected in the growing importance of its marketing and security services.

“We’ve succeeded in pivoting in becoming an information services and analytics company,” said Neustar CEO Lisa Hook during the company’s Q2 2014 earnings call.

Neustar reported Q2 2014 results at $237.5 million, a year-over-year increase of 8%. Its marketing services division saw a YoY increase of 19% to $35 million. Combined with its security services ($34 million at a 28% YoY increase), the two divisions constitute a little less than a third of Neustar’s total revenue.

Neustar’s pivot comes at an opportune time. As a whole, the company is in a bit of a bind, facing concerns that it will lose a huge contract as the provider of technology enabling cell phone users to keep their numbers when they switch carriers.

Services related to number portability constituted the bulk of Neustar’s Q2 revenues ($118.7 million, a 6% YoY increase). This impact contract made up 49% of Neustar’s 2013 revenue, and while analysts hammered Hook for a resolution timeline, she couldn’t commit to one.
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Facebook Reports Q2, Mobile Grows To 62% Of Ad Revenue

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q2-2014-fb-usethisFacebook reported second-quarter earnings on Thursday amid generally high expectations for the company's advertising business, especially as it pertains to mobile and video. Investors were not disappointed.

Facebook posted Q2 advertising revenue of $2.68 billion, a 67% increase from Q2 2013. Of that, mobile advertising is becoming increasingly important – it constituted 62% of Facebook’s total advertising revenue in Q2 2014, up from 41% in Q2 2013. Read the earnings release.

Ad prices spike, unlike Yahoo. On the company's earnings call, CFO David Ebersman said Facebook's ad volume fell during the quarter as a result of the rapid consumer shift to mobile (and, hence, news feed-only ad placements).

Meanwhile ad prices rose as well, driven by that very same shift to news feed inventory, which is more expensive. (Incidentally, it's exactly the opposite dynamic that Yahoo experienced in its most recent quarter; Yahoo's volume rose while CPMs fell.)

Ad prices are also rising for right rail inventory as Facebook pushes a redesign featuring more prominent ad formats within that real estate. COO Sheryl Sandberg added that these ads are getting higher engagement rates than their predecessors, and can be presumed to be more effective.
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Why LinkedIn Could Be The De Facto B2B Data Platform

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LinkedInEndorseProfessional social networking platform LinkedIn seemed to commit to programmatic, particularly among the B2B community, when it acquired business data company Bizo for an estimated $175 million Tuesday.

LinkedIn “has a bet on CRM and their investment in Bizo shows they really want to double down on B2B marketers,” said Ray Wang, chairman and principal analyst at Constellation Research.

Bizo brings a vast, pixel-based media exchange and anonymous demographic data on some 120 million-business professionals. This extends LinkedIn’s offsite reach and bolsters the quality of its in-market data.

“We’ve been pushing LinkedIn for a number of our clients like Lenovo and Red Hat and a number of clients have asked for this type of interaction,” said Bob Ray, president, Americas for B2B media-buying and planning agency DWA. “I think they offer up the argument to their user base that they’re still very focused on privacy, but at the same time with Bizo, they’ll offer to marketers a way to connect the dots” through new tools and services.

What’s unique about LinkedIn’s new value proposition, Ray said, is the ability to fold marketing automation systems such as Eloqua or Marketo in with LinkedIn’s own properties.

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What Yahoo Stands To Gain When Flurry Bleeds Purple 

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Mobile BlizzardYahoo has doubled down on its mobile bet, agreeing to buy mobile analytics and advertising company Flurry.

What does that mean for a company that less than a week ago reported disappointing earnings as it struggled with declining CPMs? A company that’s not yet even breaking out its mobile revenue in its earning statements, while calling it “meaningful?”

“Acquiring a mobile-first company that has really honed its expertise in mobile app marketing and analytics sends two key market messages," said Forrester analyst Jennifer Wise. "One, we’re serious about mobile. Two, we have best-in-class mobile app measurement, targeting, analytics capabilities.”

Flurry stands to be the second-largest acquisition so far in CEO Marissa Mayer’s reign. At an estimated $200 million-$300 million purchase price, it’s just a fraction of what Mayer paid for Tumblr, which came in at more than $1 billion, but far above the dozens of small acquisitions Yahoo has made, such as the mobile apps Blink and Summly.

From the perspective of CEO Marissa Mayer, the acquisition is the latest attempt to fulfill her promise to investors: that a turnaround for Yahoo won’t happen overnight, but it will happen.

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