We Punched the Monkey And It Punched Back

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Chris-O-HaraData-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 Chris O’Hara, co-founder and chief revenue officer at Bionic Advertising Systems.

I recently tried to explain what I do for a living to my 14-year-old son. I found myself telling him about ad tech.

“Basically, we make technology that helps marketers buy different kinds of banner ads,” I told him.

“You mean the kind of annoying pop-up ads that everyone hates?” he asked.

His look of profound disappointment said it all. I explained that the kind of work we do wasn’t just about populating the Internet with the “Lose five pounds with one stupid trick” type of banner. But even though we are getting a lot right, my explanations eventually started sounding pretty weak.

I have been working in this business since 1995. Aside from doing some ad implementation testing, I have probably clicked on about a dozen banner ads in as many years. Today’s robust, real-time ad tech “stack” has been purpose-built to optimize the delivery of the kind of banner ads most people already hate: standardized IAB units, retargeted ads, auto-play video pre-roll units and even the dreaded pop-up and pop-under.

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WPP Reports Q2 Earnings; Gannett Bets On The Banner

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nw3Here's today's AdExchanger.com news round-up... Want it by email? Sign-up here.

WPP Media Revs

WPP Group’s revenues rose 2.7% to reach $9 billion in the second quarter as the holding company acquired research firm InsightExpress. Read the earnings release. In an investor note, Pivotal Research analyst Brian Wieser notes WPP’s gross revenues this year are inflated “because of the inclusion of media inventory it takes possession of before selling along to advertisers. Including this activity, like-for-like revenues were up by 10.2%. The figure clearly is unrepresentative of WPP’s actual performance.” Hm. Are we talking about an agency or an ad platform? Read the rest of this entry »


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TubeMogul Q2: "Chasing RFPs Is a Very Expensive Proposition"

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TubeQ2Video demand-side platform (DSP) TubeMogul, which first began trading on the NASDAQ in July, reported $28.7 million in revenue for the second quarter.

This was a 127% increase over last year, when that figure totaled $12.6 million. Total advertiser spend in Q2 was $61.1 million. Read the earnings release.

As a point of reference, video ads platform Tremor reported Q2 revenue of $43.7 million while YuMe's was $40.4 million. TubeMogul slightly beat analyst estimates, which were in the $25 million range.

TubeMogul's self-serve Platform Direct business generated $11.6 million in revenue for the quarter while Platform Services revenue was $17.1 million. This, too, beat some analysts' estimates, which projected those revenue numbers to be $9 million and $16 million, respectively. Total spend for the quarter running through TubeMogul's self-serve platform was $44 million, accounting for 72% of total spend.

Platform Direct, according to company CFO Paul Joachim, is the "growth driver" of the business, basically doubling the number of brand advertisers using the platform to 283 last quarter. Although a majority of clients are first exposed to TubeMogul through Platform Services, the company sees this as a long-term driver for its platform business when migrating them over. About 25% of its Platform Direct clients were first exposed to the company through Platform Services.

"I think it highlights the difference in our software model vs. the model of other companies that are chasing the RFP business, which is a very expensive proposition," Brett Wilson, TubeMogul's CEO, told AdExchanger. "We're selling in software just one time and after that, clients consolidate their spend with us with little to no sales costs, so our model supports a lot more operating leverage."

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Live Nation Entertainment's Programmatic Opener: Custom Audiences

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livenationWhen Live Nation Entertainment appointed Xaxis alum Mike Finnegan as its first ever VP of programmatic and product innovation – a role he assumed Monday – it did so with the intention of using its first-party data to build bespoke audiences for advertisers.

Formed in 2010 when events promoter Live Nation merged with ticket sales company Ticketmaster, Live Nation Entertainment is taking advantage of programmatic’s maturation as well as its own evolution into what it describes as a digital publisher, content producer and digital solutions company.

“Low-cost banners aren’t what [advertisers] want anymore,” said Finnegan, who spent three years at Xaxis, initially building a managed service team to execute programmatic buys and later as its director of product development. “Now [programmatic is] much more focused on audience and unique media executions.”

Consequently, Live Nation Entertainment’s initial foray into programmatic will focus on that audience-creating practice, as opposed to pushing inventory onto an open exchange.

“We won’t open ourselves up to an open marketplace,” said the company’s SVP of digital sales, Jeremy Levine. “At some point, potentially, but out of the box, it’ll be customized partner-by-partner opportunities.”
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Not Taking Programmatic In-House Is Short-sighted

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tom-triscani“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 by Tom Triscari, CEO at Yieldr.

When an advertiser’s CEO, CFO and CMO meet to discuss their programmatic marketing strategy and budget, they increasingly talk about whether to take an in-house approach. Some argue such an approach is short-sighted.

I believe the opposite. The answer is often simple. Just do the math.

If you buy a lot of full-funnel display and pay 50% margins today (note: ad tech vendors and trading desks cannot disclose margins) but could pay 15% or less for in-house ad tech and pay the going market rate for a small team of campaign DMP engineers and optimizers, you end up generating massive savings. The savings can be used to augment or even create a big competitive advantage.

Some early adopter advertisers have already moved past talking and are actually doing it. When we see companies like Accenture move into the business, we know something big is changing. Early adoption is very smart; when done correctly, under a C-level mandate like P&G’s, the competitive edge gained can be an enduring one.

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Pinterest Adds Better Measures For Its Future Advertisers

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pinterest-dashboardPinterest has the best data among the social platforms that have yet to embrace ads in a big way.

It's often said the company, like Google, is inherently intent-based, exposing potential future purchases each time a user "pins" the wrap skirt or maple countertop her heart desires.

Today Pinterest is creating more granularity around user interactions with the rollout of new reporting capabilities showing pins, repins, shares and other interactions with a business's presence on the service.

The offering is the company's first global product rollout for advertisers (Promoted Pins, its paid media product, is still in a limited beta test), and is available in 31 languages to all marketers that convert to a business account. The point is to help business users, "partners" in Pinterest's parlance, identify what's resonating and use that information to support marketing initiatives.

Data available through the new interface include total reach for a business account's pins, broken down by gender, device type, country or metro area when applicable. Aggregate actions such as total repins, clicks and shares are available, as is repin data for individual pins.

Over time Pinterest says it will offer more data on specific pins, and on interactions with the "pin it" buttons companies host on their own websites. It's easy to see the implication for ads when the analytics dashboard can show reach and performance of organic vs. paid pins.

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Q2 Mobile CPG Spend Spike Isn’t Just An Aberration

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mobileCPGspendCPG brands are starting to shell out more on mobile programmatic and the second quarter of 2014 seems to be the burgeoning proof.

Mobile ad exchanges Smaato, Millennial Media and Nexage all saw noteworthy upticks in CPG mobile spend in Q2. A report released Tuesday based on global data gleaned from the Smaato exchange found that the food and retail category grew from 8% to 25% between Q1 and Q2 2014, an increase Smaato’s chief strategy officer Ajitpal Pannu attributed, at least in part, to brand advertisers growing more comfortable with spending on mobile.

Smaato Mobile Exchange (SMX) serves about 90 billion impressions per month.

“CPG as a category is a fairly large spender in the overall industry and CPG advertisers have definitely been early adopters of programmatic,” said Pannu, who pointed to P&G’s announcement at the beginning of June that it wants to buy 70% to 75% of its media programmatically by the end of 2014.

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MAGNA Global: Digital Ad Sales Could Outpace TV By 2017

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USspendDigital media could be the No. 1 ad category in the US by 2017 with $72 billion in spend, outpacing TV by about $1.5 billion, according to a MAGNA Global quarterly Advertising Forecast released Tuesday.

The report attributed the shift partly to “the advent of programmatic buying in digital media and the stabilization of cost for premium video inventory,” converting categories of traditional TV spenders (namely consumer packaged goods companies) to digital channels. Marketers are exploring integrations of consumer and sales data to enhance digital media targeting.

Although television revenue was up 4% in the first half of the year, MAGNA lowered its full-year forecast from 8.3% to 6.1% in total growth for that category. Other traditional media categories fared worse in terms of revenue growth: print was down 9.5% year over year in the second quarter, radio was down 4.7% while out of home revenues slowed from a 4.3% growth rate to .9%.

Overall, US advertising revenue is expected to grow by 5.1% to $167 billion this year, a slight decrease from MAGNA’s previous growth estimate of 6%. This was attributed to non-recurrent ad spend generated from Political and Olympic (P&O) campaigns and “softer-than-expected” market conditions related to the economy in Q2.

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How Refinery29 Finds And Sells To Millennial Women

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Destination Refinery29Refinery29 started out as a fashion blog, but it’s since expanded its vision: It plans to be the go-to source for millennials on the subjects of beauty, travel and points of view on subjects ranging from dieting to news coming from Ferguson, Mo.

It's also a high-growth company. The digital publication has 15 million monthly uniques, according  to Google Analytics data as well as its social following. A significant chunk of its traffic comes from what it calls “loyals,” people who visit Refinery29 nine days or more a month; loyals account for 40% of total users. Many of these loyals subscribe to Refinery29’s newsletter, so driving more people to the newsletter is a priority.

The next step for Refinery29 is looking for millennial women across the globe. It plans on opening shop outside the United States in the near future. It’s also expanding its advertiser base. Refinery29’s core of beauty and fashion brands is expanding to travel brands and advertisers like Home Depot, which is pursuing DIY women.

There’s still room for Refinery29 to grow at home, however. The United States has about 40 million millennial women. Refinery29 reaches 15 million of them, according to its visitor statistics, so “there is runway for another 50% growth,” estimated the company's CRO, Melissa Goidel. Read the rest of this entry »


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Innovid CEO: “In-Banner Video Is Not Video”

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ZvikaNetterInteractive video ad tech startup Innovid has changed significantly since its beginnings in 2007, when it had nothing to do with advertising.

Though it has since helped companies like Toyota, Chrysler and Sony Pictures serve up dynamic and interactive pre-, mid- and post-roll video ads, and has worked with both Roku and Sony Playstation to deliver over-the-top ads, it was founded by a group of guys with “no media/ad tech backgrounds whatsoever,” said Zvika Netter, Innovid’s cofounder and CEO.

Innovid’s initial incarnation was as a platform that dissected video content frame-by-frame and extracted metadata. “We spent three years building the platform and interacting with studios such as MTV and CBS to change the whole format of how news, sports, cooking shows (looked in digital),” Netter recalled. “It was a lot of cool, fun stuff, but absolutely no revenue.”

No revenue, however, isn’t a sustainable business model and in 2010, Innovid began its exclusive focus on advertising, working initially on pre-roll ads and now partnering with a number of video ad networks, premium publishers and tech platforms to serve interactive, cross-screen placements.

Netter spoke with AdExchanger for the next installment in a series of Q&As evaluating the video ads ecosystem. Past interviews have included: BrightRoll, Ooyala and SpotXchange. This series will also include Videology, Vindico and more.

AdExchanger: Describe the Innovid platform.

ZVIKA NETTER: Our Atom platform runs pre-roll (interactive iRoll) and other formats across web, mobile, connected devices and we’re extended that into the TV world. We’re not active on the traditional TV dollar side, but we have insight on the digital side, and we absolutely see digital video budgets increasing where we are active with things like addressable, personalized and dynamic video.

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