RAMP Digital CEO Mendez Says Direct Response And Brand Marketing Are Blurred Online

Jonathan Mendez is CEO of RAMP Digital, a digital, performance media agency.

CEO Jonathan Mendez of RAMP DigitalAdExchanger.com: Why did you found your performance marketing agency, RAMP Digital?

JM: I was becoming much more interested in emergent technologies for delivering relevance, namely APIs and semantic driven tools. At Offermatica (now Omniture Test&Target) our platform was 100% JavaScript and while that is really great, there are a number of targeting and dynamic content executions pre and post click that can benefit from other technology. Also, I wanted to get back into media buying. Prior to Offermatica I was buying a lot of Search. I really value and enjoy the role of buy-side optimization in the overall performance mix and with marginal returns of display approaching search the timing seemed right.

What trends have you seen in the past two or three months?

There are trends the past two or three days! There’s a huge push around moving offline data onto the web for targeting in every conceivable fashion. I’m seeing more use of bid management for display. I’m seeing consumer-oriented publishers continuing to be frustrated with technology while B2B players continue to innovate. I’m seeing Google eating everyone’s lunch. I could go on and on…it’s chaos. Things are moving too fast. You must be built for speed, not for comfort.

What’s your view? Is all online marketing direct response (DR) marketing – including brand?

Online blurs the lines between direct response and brand marketing. Those are antiquated terms from old media. The web is the first user-controlled medium. Qualifying our media as DR or Brand has been hurting us in moving spends to digital. All marketing online and offline is about eliciting an emotional response and then an action. The benefit of online marketing is user level measurement of those actions so you can attribute value to them. Consequently, if you can measure it and valuate it, you can optimize for it. I think we forget how revolutionary the click is. No better proxy for interest and intent has ever existed. Getting response is what is valuable in a user-controlled medium. Everything else is bullshit.

What is essential for a successful media agency today and tomorrow?

In my experience there has and will continue to be two parts of success in digital media — the creative use of technology and the use of technology with creative/ content. Those are two distinct practices. Both add incremental value and provide consistent sustainable competitive advantages. They also address the two must have new media mindsets. Every digital media company needs to be a technology company and nothing impacts results more than your ability to deliver relevance.

Do you think behavioral targeting is an important part of the marketers toolkit? Why or why not?

Right now for marketers that are managing to ROI the answer is no. The added cost and reduced volume does not provide enough performance lift to make sense. Also I don’t trust 3rd party data – the amount of validation, testing and optimization involved in using it is not worth the effort. My advice is get really smart about geo targeting and temporal targeting. Those are targets that don’t move — it’s much easier to hit a bull’s-eye with them. AdultFriendFinder built a $500M business by simply geo-targeting dynamic content. I am also not a fan of audience targeting. I think this is being used to push more traditional media budgets to display using the vernacular and buying strategies of traditional media. What defines people on the web is what they are doing – not who they are or what they’ve done. I think we can see that the more effective we are with that –search & retargeting being the best examples – the more valuable it becomes to everyone.

How is optimization playing out at your agency? Do you think you’re able to optimize creative, landing pages, audience and context effecitvely – if not simultaneously?

I think our performance bears out that we are extremely effective. I’ve been using the same methodology for five years across multiple channels both ad side and site side and in every major vertical. The advances in technology have enabled it to be more efficient, targeted and scalable. In cases where we control the media, the creative and the landing page we have a distinct advantage. I think it’s important to remember that this is a competitive medium and only getting more so. But there are real issues as we try to optimize display the same way we do search. There is also a big opportunity in solving that problem and we have been working on that quite a bit the past six months.

How do you feel about attribution models you’re using today?  Is there room for improvement?

I love last click attribution because it is an indisputable metric. My perspective on view-based and prior click based attribution is that they are baked into my media performance. The problem with those attribution metrics is their impact is REALY hard to valuate. We need to be making valuation of traffic and performance easier in our industry, not harder. This is the number one issue holding back massive digital ad budgets. So few properties know what an online visitor is worth. Real progress comes from attribution models focused on the sell side. This would really drive spend as publishers would pay to acquire traffic. From Amazon to Google this is the way successful digital businesses have always been built. The people complaining the loudest about last-click have their own agenda. They want to move more dollars into display from search and they want to serve all the ads. Attribution is their Trojan horse. If I were a publisher I would be concentrating on attributing the value of my visitors by channel and figuring out how to increase that value.

Are you able to convince clients that search and display is an essential combination among marketing tactics?

I actually presented a case study three years ago at SES (Search Engine Strategies) on how display drove search inventory for Sony but nothing has changes since then. Most clients are impotent to leverage this. Everything is still so siloed. But I’m still trying! This year I started a dedicated session at SES about Search & Display and we’re now doing it at our third show this December in Chicago and will probably expand it to two sessions at SES NY. It reminds me of when I used to speak about Landing Pages. In the early years there were a few people in the room, mostly performance marketers. Now the room is packed and people are writing books about it. We’ll get to the packed rooms eventually but true synergy is still in early adopter mode.

What is a “digital experience” – which you identify as a solution for brands on the RAMP site?

A euphemism for “a microsite.”

I believe you represent your brand best through the experience someone has with your product or service. The web is no exception. Actually in my mind it is the rule. If microsites were optimized to deliver relevant content they would achieve much more brand value.

What’s your view on real-time bidding? Over blown or a Holy Grail?

Conceptually I love it but there are tremendous technology challenges with RTB. There has to be real scale for RTB to manifest itself in a way that’s advantageous. I also feel there will be market issues as you start to unbundle impressions. That effect at scale could widen the delta between the value of media for advertisers and publishers. In the long run that is a bad thing for everyone, except maybe Google.

How do you see the DSP (Demand-side platform) model playing out? Will agencies be the only ad network left standing?

My money would be on players like MediaMath and Invite. I think most agency platforms will be marginalized by services/performance. Agencies will go back to doing what they do best, allocating dollars across media channels. That said, my firm belief is digital media outside of search is being vastly undervalued by the measurement and relevance inefficiencies of current display paradigm and DSPs do nothing but amplify that. When I back-in CPM for my most successful Search programs it is $85-$100. And that’s not artificial or arbitrary value, that’s performance based. Publishers own the audience, the content and the data. Intent is generated on their pages. That collective value is enormous. So in my opinion it is the supply side that needs the platforms, not the demand side.

Follow Jonathan Mendez (@jonathanmendez) and AdExchanger.com (@adexchanger) on Twitter.

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