How We Bring Brand Dollars Online

Data Driven Thinking by Zach Coelius of Triggit“Data Driven Thinking” is written by members of the media community and containing fresh ideas on the digital revolution in media.

Today’s column is written by Zach Coelius, CEO of Triggit, an online advertising technology company.

As we all know, the balance between the amount of time people spend on the internet and the online share of marketing dollars is way out of whack.   Yet even as we all point to the problem, and as every VC pitch deck for a digital media venture includes the cliché slide showing the imbalance, the gap between offline and online dollars has remained wide.   As hard as it is to admit, the problem lies not with uninformed marketers who don’t realize how efficient internet advertising is.  The reason why the gap exists is that internet advertising still largely sucks and we have a lot of hard work to do to fix it.

To bring those dollars online we must build a media ecosystem that is better than television or print.   At the core of that problem are three challenges we need to overcome as an industry:

  • The first challenge, which I have written about in the past on these pages, is that we have to be able to deliver scale to marketers where they can spend hundreds of millions of dollars easily and effectively.  If large media buys require cobbling together dozens or hundreds of independent sites or networks, we will never achieve scale and large marketers will not be able to utilize their budgets.
  • The second challenge is that we must deliver quality audience experiences where marketers can use all the tools in the advertising quiver to amuse, beguile, entertain, educate and generally capture the attention of their audience.  I will leave that topic for another post, but if the miserably tiny and insufficient 300×250 ad unit is the apex of the canvas that we will provide for communicating, I am tendering my resignation today.
  • And last for the topic of this post, before marketers will bring their dollars online at any scale, we must provide them with control and ultimately trust in the how, when, where, and why of their online advertising.

The challenge of providing marketers control of their online advertising is complex.   Issues like brand safety, flexibility, transparency, appropriate targeting, trust in their partners and insights into real media costs are all incredibly important and intertwined.  If you were the CMO of a large brand like Coca-Cola, would you be comfortable entrusting a hundred million dollar marketing budget to a partner who wouldn’t tell you ahead of time where your ads were going to run, what the actual media costs were, if they were arbitraging you, or provide any protections for your sixty eight billion dollar brand?  Hell no!  Maybe you would work with such a non-transparent partner for a small test budget, but not for the big money.  Yet these are all practices many in our industry openly engage in, and worse, many who sell media consider it normal to not be transparent with their customers.  And we wonder why the big brands are not moving their budgets online.

Yet there is hope that we as an industry finally seem to be growing out of some of our more self-defeating tendencies and maturing.  Over the last year the norm is slowly shifting towards transparency, control and brand safety, and away from the black box.  The reason for this is the significant advances in technology underlying the display exchanges such as real-time bidding.  Contrary to the oft-repeated but uninformed statement that “exchanges are just for DR and are not a good place for brand advertising”, exchanges and real-time bidding are actually leading the industry with innovations and protections for brands.   Unlike the first generation of exchanges that rely on a daisy chain of ad server calls and are therefore largely blind, the latest generation of exchanges and DSPs provide marketers much more control.  What this means is that a marketer with access to a DSP can now fully control every aspect of a campaign and choose which sites they want their ads to run on, the data they want to leverage and all the while have complete visibility into media costs. Brand safety can now finally be achieved even before the campaign launches by setting up a tight white-list of top-tier safe sites and not having to worry about showing up anywhere else unexpected.   Or, because a marketer can now control the levers and knobs of the campaign, they can make changes – or even stop it all together – if things work in unexpected ways.   Customers are finally starting to have control of the how, when, where, and why of their campaigns and that is great.

Fundamentally, these changes are all about empowering the advertiser with trust for the digital medium.  As brand advertisers start to see the companies they work with in digital as partners rather than as middlemen or vendors, and as we give them the tools and transparency to reinforce this trust, we should see significant gains as an industry.  The goal we all share is to bring the offline dollars online.  That can only be achieved with openness, transparency, safety and most importantly, trust.

Follow Zach Coelius (@zachcoelius), Triggit (@triggit) and (@adexchanger) on Twitter.

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  1. Nice post Zach. We definitely share the vision of moving more dollars online. The stat I use that I find amazing (and sad) is the amount of ad dollars per hour of user time spent with TV vs. online. For television it is 20c per hour of time spent (advertisers are paying 20c on average overall for that hour of your time). With all its supposed interactivity and measurability, online non-search advertising is at a woeful 21c per hour. Search weighs in, however at $3.24 per hour (!). Online advertising is still far from achieving its promise, so it is up to us to help build that infrastructure so that advertisers can realize the value we know is here waiting to be unlocked.

  2. Zach-

    I think you have hit on some great points but feel you may have missed some important ones.

    Large advertising budgets allocate massive amounts of capital on branding, in particular consumer packaged goods companies (CPG’s). Unfortunately, most, if not all, CPG purchases take place offline. As consumers move to making these types of purchases in less traditional outlets (7-Eleven, gas station convenience stores, etc.) marketing companies who have long been dependent on old fashioned grocery store sales information, find it harder to obtain and analyze that data.

    As rich as online, behavioral data is, it still cannot substitute for granular, panel-like data. And although you can purchase reach through exchanges, it is difficult to measure its effectiveness.

    This leaves CPG companies reliant on traditional market research groups (which extrapolate their results) and purchasing massive reach in traditional media outlets.

    As for trust and brand safety, because online data collection is often done surreptitiously, it fails to recognize the consumer as being part of the process, leaving them less trusting of a brand.

    There have been some very successful attempts at using non-traditional advertising online. Reaching consumers through games, direct engagement and promotions appears to work, but still doesn’t have the massive reach of traditional outlets.

    In my opinion, these are the reasons CPG advertisers are reluctant to allocate large budgets to online reach, continuing the digital dimes (better than pennies) versus analog dollars battle.

  3. Zach – agreed. RTB is DNA that will bring simplicity to all of this–scale, control and creative.

    For RTB inventory sources, scale is driven by a unique and compelling proposition to your publishing partners.

    For control, look at the variety and quality of impresssion level attributes provided by your RTB inventory source – understand if each bid request contains elements such as accurate content of page, keywords on page and referring URL.

    For creative, does your RTB inventory source enable rich media and expandable ad units? RTB use cases are moving aggressively into brand and this is one step in the right direction.

  4. TV commercials enable an advertiser to deliver an emotional message that can not be duplicated in quality, scale or context online. Until online can match the experience, I don’t think it will be the centerpiece of most big brand campaigns.

  5. For many years the Knights of the Roundtable traversed Britain in search for the Holy Grail. When the Castle where it sat was discovered it was broke down, decrepit and rotting. The first Knights that got to the Castle fumbled their chances. The next group of Knights were denied because of their past transgressions. Finally Galahad was permitted to enter the Castle took one look at the Grail and died.

    • Jonathan,

      Are you implying that if someone discovers the metaphoric “Holy Grail” for digital media monetization they are certain to fail or perhaps even die?

  6. Once there was a group of little duckies who sat on one side of a very big and very scary pond. On the other side of the pond where a few big, fat and lazy ducks that were eating huge piles of bread from a bountiful trough. Some of the little duckies wanted to cross that big pond and worked hard to figure out a way to get over to the other side. Others of the little duckies were scared by the wind and the eagles and the scary ghosts and instead just decided to quack a lot about how crossing the pod was impossible and how anyone who even thought of trying was silly. To be continued…

  7. Rob, I totally agree. We have a lot of work to do to bridge to gap.

    Jeff, you are correct that attribution is a very important part of the puzzle that we will need to solve. The click and the view through are clearly not sufficiently accurate ways to effectively gauge online ad spend. I personally am excited about the ways that marketers can start to connect their customer data with their media buying through a dsp for attribution.

    Jay, I can’t wait until we can buy rich media and expandable units thought the exchanges at scale.

    Alan, I agree that the woeful little display units suck compared to a tv comercial. We need bigger ad units so that we can start to communicate emotional, funny, and compelling messages that add value to the users internet experience. For instance, how do you tell a joke in a tiny 300×250? Until we can tell jokes in our ads we are in trouble.

    • Zach

      DSP “Demand Side Platform”

      Here’s what I question with regard to use of the term…

      Whose Demand?

    • I Apologize Zach. I knew that.

      I look at it from a different perspective.

      It is the audience (or consumers, whichever term you prefer) that “demands” media content. Media permits advertisers and marketers to achieve reach.

      That’s why I was never satisfied with the use of the term.

  8. Nice post Zach. I agree that transparency is one of the keys to bringing the large brand dollars online. The CMO at Coke wants to know where the ad is going to run, not some run-a-round story from a network about how the ad will run on sites “like” NYTimes, ESPN, CNN, etc.

    The other main issue is that brand marketers want to know “who” is seeing their ad, not just where the ad is running. I’ll say it loud and clear….DEMOGRAPHICS. Everything….and I mean everything online at this point is cookie based behavioral direct response targeting. Success is determined by one and one thing only…..response (click-through, sell-though, action). large consumer brands like Coke, Budweiser and Campbell’s soup are not interested in click-through….they are interested in selling more goods at the store.

    I love that the new DSP model is giving marketers more control, transparency and leverage over their campaigns, but we are still missing a huge point as an industry…large brands buy large audiences based on demographics. We all know BT doesn’t scale so why are we continuing to solely focus on BT data to better drive response online. The large brand dollars will continue to trickle in until this industry figures out how to drive accurate demographics.

  9. Mike, I couldn’t agree more. I am waiting anxiously for someone to provide us a cheap, scalable and effective way to provide demo targeting to our customers. I can’t wait to test what you guys are doing at Feeva soon.

  10. Andy, sadly John won’t let me turn my articles into 10,000 word opuses or I would be able to a better job of covering more of the various factors like the ones you point to. It is clearly a much more complicated problem then can be adequately addressed in nine hundred words. As you, Jeff, Alan, Jay, Jonathan, Mike and Rob very correctly pointed out, we have a ton of work to do before our industry provides a better platform then display or print. I completely agree that providing predictability in pricing and online to offline attribution are critically important to brand advertisers. I think you will see in many of my writings on the need for scale an implicit agreement that marketers need a reliable and scalable way to allocate their media dollars. Though I wholeheartedly disagree that predictability is solved any better by having a middleman arbitrage the marketer then in a open and transparent marketplace (personally I am a fan of efficient markets rather then middlemen). On the side of bridging the online offline gap I am in complete agreement, it is a huge opportunity that we all should be hard at work to solve.