The results are in.
Oracle’s Moat Outcomes API, a product that attributes digital ad impressions to in-store product sales, announced its first DSP integration with StackAdapt on Thursday.
The product is specific for CPG and retail vertical clients, with Moat licensing data from retail membership and loyalty programs to connect those customers to online identity data.
Moat’s roots are as an ad verification tool to support real-time programmatic. That’s an important differentiator for the Moat Outcomes API, said Michael Shang, StackAdapt’s VP of partnerships and business solutions. Other retail attribution services, such as IRI and NCS, operate on a longer time frame, he said.
A CPG campaign running from January through March typically might get an in-store sales lift report in May, Shang said. But with Moat and its RTB-native product, campaigns only run for 10 days before an advertiser starts to see daily attribution and optimization data.
The media agency Vue Digital, a pilot ad partner for the Outcomes API, is looking for products that “transform our client conversations from hypothetical to tangible results,” said paid media manager Kelly Weber.
Focusing on outcomes is especially important if a brand has parallel campaigns running via walled garden platforms, such as Google, Facebook and Amazon. These platform self-attribute sales with a black box model, which means the programmatic agencies don’t have visibility into the actual conversions.
The Outcomes API will help advertisers transition to campaigns graded by results rather than loose proxies, Weber said. Today, CPG-retail campaigns typically use engaged site visits – i.e., did someone visit a product purchase page or take another action on the brand’s site? – as an indicator of someone’s intention to buy. But that’s just a correlation, she said, not the actual result.
But the Moat Outcomes API isn’t necessarily the right choice for every CPG brand, Weber said.
A candy brand’s Halloween campaign that runs for a month, for example, may not be worth the added cost and complexity of optimization. Since the API does attribute based on individual-level connections as opposed to a general store sales lift metric, it requires a committed campaign that will run for months, or at least six weeks, to build up a statistically significant conversion data set and allow time for optimization.
Even so, it’s a valuable way to get small and medium-sized product brands to test and attribute based on store sales, which they haven’t been able to do in programmatic before, Weber said.
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From Instacart to Uber, a wide variety of digital businesses are realizing that they can spin up advertising businesses.
Their inspiration? Amazon’s “other” revenue category. Composed mostly of advertising revenue, it’s proven to a slew of digital companies that they can gain profitability by pursuing the sky-high margins in advertising.
On this week’s Big Story, we talk about why such a wide variety of companies – including “buy now, pay later” companies like Affirm – are spinning up ad businesses now, and what’s in it for marketers. We also discuss the evolving nature of retail media.
There’s another thing many of these companies have in common, too: closed-loop attribution, since they’re oh so close to a consumer’s grocery store checkout, for example.
Also in this week’s episode: Roku and Shopify paired up to give smaller, direct-to-consumer brands access to connected TV inventory. The connection is one of many TV ad sellers are forging with SMBs.
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NBCUniversal highlighted three streaming-oriented companies it is considering – Conviva, Dumbstruck and Truthset – to create a framework for alternative currencies as it prepares to move away from legacy TV ratings giant Nielsen as the industry’s single currency provider.
Kelly Abcarian, NBCU’s EVP of ad measurement and impact, again called for “measurement independence” and for the industry to move away from relying solely on Nielsen at the Advertising Research Foundation’s Audience X Science event on Monday.
Though she didn’t specifically call out Nielsen, Abcarian gave a keynote speech challenging the industry to focus on opportunities with multiple measurement providers who use advanced data and analytics, saying that the traditional panel-based surveys the measurement giant is known for are not equipped for connected TV.
“Measurement independence won't happen overnight, especially if our industry continues to focus on our collective deficits, rather than our collective opportunity,” Abcarian said. “Part of the problem is that we all spend way too much time … focused on addressing the current system’s failures.”
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Opera Ads, the online ad platform launched by Norwegian browser maker Opera in 2019, is serving up some self-serve.
On Wednesday, Opera launched Opera Ad Manager, a self-serve ad platform to buy inventory on Opera News (not to be confused with a publication of the same name about the actual opera) that doesn’t use third-party cookies.
The Opera browser accounts for 2% of browser market share, according to Statcounter. On a monthly basis, the Opera browser and news apps reach more than 300 million active users, as in people who actively choose to use Opera products rather than the ones that appear by default on their devices, according to Per Wetterdal, EVP of commercial at Opera.
Opera News feed inventory appears in multiple Opera apps, including the Opera Mini browser app for Android and the stand-alone Opera News mobile app, which aggregates news from international, US and local sources and personalizes the feed based on trending topics, language and categories of interest.
But users only see ads when they’re engaging with the news content feed and not when they’re browsing the web, Wetterdal said.
Advertisers could already buy ads on the Opera News feed as a managed service.
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"On TV & Video" is a column exploring opportunities and challenges in advanced TV and video.
Today's column is by Dan Fairclough, Sr. Director, Agency and Brand Relations, Magnite.
In my many years working with DTC brands, I saw firsthand how companies hustled to grow their brand visibility from the ground up using search and social.
Then, eventually, they would hit a wall. In order to further scale as a brand and ensure they were driving sales within their acquisition benchmarks, they needed a better way to get in front of the right audience – across a landscape where viewership is more fragmented than ever.
For direct-to-consumer brands, every dollar spent on media needs to tie back to sales. They truly need dollar investment to convert to results; they relied on performance marketing before it became a buzzword. They also need a way to optimize campaigns in real time without making dozens of phone calls and be able to track outcomes in a consolidated manner.
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Here’s today’s AdExchanger.com news round-up… Want it by email? Sign up here.
Swimming Up-Stream
Wall Street is coming around to streaming revenue as a long-term priority. Or, rather, as a source of heavy immediate investment. ViacomCBS has done well enough out of the gate with its Paramount+ streaming service to inspire Wells Fargo to “move from historical bears to constructive bulls,” according to an analyst note. The TV and film giant now merits a “Hulu-esque valuation,” with streaming advertising and subscription revenue estimated to reach $8 billion next year, per The Hollywood Reporter. That gives ViacomCBS the backing to double its production budget for Paramount+ in 2022, up from about $15 billion this year. This will also eventually spread to how shows and films are judged by investors. Currently, there’s a measurement gap because success is still pegged to box office sales and Nielsen ratings. In time, factors like new subscribers and contribution to user retention will be more important.
Keeping Tabs On The Lab
Two of the IAB Tech Lab’s senior leaders left this year, SVP Jordan Mitchell and CEO Dennis Buchheim. But Anthony Katsur, the ad tech vet named the new CEO of the IAB Tech Lab in July, wants the organization to be a more forceful, productive industry hub for engineering and technology standards. The IAB Tech Lab is in a thankless spot. It ranges from brands to publishers, with every three-letter acronym company in between. And the reality is, decisions made by the Tech Lab often go against important constituencies of the group. On top of that, the organization needs to corral developers, some of whom are openly frustrated and none of whom work for the IAB, to come to agreements on standards. It’s easy for stakeholders to drag their feet and ideas end up dead in committee. “The feedback I’ve had so far is that the Tech Lab has been too consensus-driven and hasn’t taken a position on the important issues,” Katsur tells Digiday. “We’re going to change that.”
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One of the most important trends in advertising right now is the rapid growth of ad businesses stood up by non-advertising companies.
The OG of this category is Amazon. The online retailer has shown ads can be a high-margin addition to the bottom line, boosting profit without heavy upfront investments for any business with valuable data and real estate for potential ads in an app or site.
It came as no shock when Instacart, the online grocery delivery platform and an Amazon Fresh competitor, launched a self-service ad platform last year. Or this year when buy now pay later (BNPL) services Klarna and Afterpay, which offer installment-style payments for ecommerce, started testing in-house ad networks powered by their financial data. Uber is also investing heavily in its ad business, including the recent hire of Mark Grether from Amazon Advertising.
Another thing each of those companies has in common: They’re unprofitable. Advertising offers a bridge to profitability, since ad revenue can be earned with relatively little hiring and without acquiring new users.
Here are some of the businesses and categories that embraced ad revenue, and how they approach advertising.
The grocery game
Instacart was a fast follower of Amazon into the ad business. That’s hardly a surprise, considering it works with many of the same retail trade marketers bringing their promotional budgets online, rather than coupons campaign and in-store displays. Instacart also poached Amazon’s ad tech leader, Seth Dallaire, as its CRO.
Instacart’s financial info isn’t public, but the company lost more than $300 million in 2019, and had its first profitable month last April, when so many new customers tried online grocery during quarantine, The Information reported last year. But even with the unforeseen surge in orders, Instacart turned only a $10 million monthly profit; and since it needed to hire thousands more delivery workers to meet demand, that profit number wasn’t sustainable without further investment.
Instacart raised more than $2.7 billion from venture capital investors, but it’s an extension of retail grocery, known for high costs and low margins. Products often have a profit margin of only a few percent points. Unlike the easy scalability of a software platform, Instacart must hire gig workers to match sales growth. To grow sales, Instacart must either convert new customers or replace more and more of their store visits. But user acquisition and retention are expensive propositions right now.
Instacart isn’t the only delivery service pivoting to ads. GoPuff, a one-hour delivery service for convenience store goods, launched an ad platform this year.
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Here’s today’s AdExchanger.com news round-up… Want it by email? Sign up here.
Buy What You Know
Shopify and Roku announced a partnership to bring a Roku app for CTV ad creation and campaign management to the dashboard of all Shopify merchants. The idea is to crack into the $16.4 billion that small and medium-sized businesses spend on local TV ads, Insider reports. It’s unclear whether Shopify’s customer base overlaps considerably with businesses that spend on local TV ads, as opposed to ecommerce brands. But many Shopify merchants likely are lukewarm on CTV advertising, because it’s expensive relative to video CPMs and is a fragmented, unfamiliar market. "You don't know who to trust and there's a lot of clutter," said Jesse Math, VP of advanced TV at the performance agency Tinuiti. "So having the confidence you're spending your money in the right places and in the right way can be a barrier to entry." AdExchanger has more on Shopify’s platform partnership streak, adding TikTok, Facebook, YouTube, Snapchat and more.
News You Can Zeus
Zeus Technology, The Washington Post’s ad tech unit, launched an ad network pooling inventory from the Post and publishing partners such as the Dallas Morning News and Graham Media Group, an affiliate TV station owner. Zeus has 125 clients, so there’s low-hanging fruit, but local news outlets are past ripe. Joy Robins, the Post’s revenue chief, tells Axios the ad network could propel Zeus to nine-figure ad revenue next year. The goal is to have a dozen publishers in the network this year and 100 within a year. And the pricing will be a flat $9 CPM – add an extra $1 for audience targeting parameters. Those rates are higher than Google or Facebook, typically, but lower than publisher-direct deals. It’s hard to imagine a local news ad network earning nearly $100 million next year (BuzzFeed earned $321 million in 2020, for comparison’s sake), but it’s the logical, looked-for next step for Zeus Technology. Vox Media launched an ad network last year. And while there aren’t huge revenue gains in local news sites, being the best-in-class news publisher ad network is a long-term priority, as advertising IDs consolidate.
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Now that the drama has died down around the merger process between The Stagwell Group and MDC Partners – the two finally became one in August – Stagwell, as the new entity is being called, has its eye on cracking into media.
The Stagwell Media Network was born in August as the combination of eight agencies in the group, including Media Kitchen, GALE, Grason, Assembly and ForwardPMX (the latter two of which were combined into a single agency in mid-September).
Together, the media agencies in Stagwell’s network manage nearly $5 billion in spend, says CEO Mark Penn on this week's episode.
Media was “one area where we really needed to put things together,” Penn says, noting that the individual agency brands are still pitching their own business.
“But together, we can go out and win some very significant media contracts,” he says. “Because of our combination of creative and data … some accounts that might have gone to a creative-only agency want much closer synchronization with media and targeting.”
Which is a little ironic, considering all the effort that the marketing procurement folks have put into scouring the supply chain.
“What procurement spent a decade separating,” Penn says, “many clients are looking to put back together again.”
Also in this episode: What the name “Stagwell” refers to (it’s not a person); cross-agency collaboration; what it means to be a “challenger holding company” and what the heck it even means to be a holding company at all anymore. Plus: Penn’s secret love of esoteric cartography and its unlikely connection to marketing.
"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 Rekha Gibbons, Head of Multicultural Marketing & COO of Raare Solutions.
According to the US Census Bureau, by the year 2045, the minority population of America will become the majority. The historical white majority will be surpassed by minority segments of Black, Hispanic, Asian and multiracial groups. Brands who realize this paradigm shift can seize massive opportunities to engage with the “new face” of the American consumer.
And yet, even though one out of three consumers in America is multicultural, only 5.2% of marketing spend is directed toward them. This is despite forecasted spending power exceeding $1 trillion for Black, Hispanic and Asian populations.
How do brands navigate this impending shift in consumerism? For starters, acknowledge the opportunity. Improving cultural segmentation allows a brand to connect and communicate with consumers based on signal and behavior-based data.
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