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Why Data Science Is Critical To Ad Agencies

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roundarchThere is no doubt that data-driven advertising has transformed the marketing landscape. Traditional advertising agencies are fighting a steep battle against data-heavy enterprises like Google and Facebook as well as more nimble startups. Roundarch Isobar — an Aegis Media-owned digital marketing agency — is striving to embrace big data and mobile advertising. Its clients include HBO, DailyCandy.com, Adidas and the US Air Force. AdExchanger spoke with Tim Dunn, Roundarch Isobar’s director of mobile.

AdExchanger: To what degree are your campaigns data-driven? Can you give me an example of how you apply data to a campaign?

TIM DUNN: I’ll use our client Avis for an example. I think that with a lot of search [tools] the search activity is divorced from the data, which is apparent in the search results. What we did for our client was deploy a range of dynamic search pages using granular data. If, for example, someone was doing a search on Toyota vs. Chevy Cruise, we could bring that person to a page where all the features are compared next to each other. Through that we saw a huge decrease in cost per outcome.

Do you have your own data scientists or do your clients bring their own in?

It’s a combination. We have a whole big-data practice of people who look at these things, particularly on the SEO side. Big data is getting more academic, not just in Roundarch, but in the rest of the Aegis group in the US. From an agency perspective, data science is becoming more important. Most agencies aren’t even close to it, let alone having a team occupied with big data on a daily basis.

There’s still a lot of marketing that can be done traditionally but I think that performance-based marketing will be paying more bills as we move forward. Also, the notion of providing personalized experiences for people is going to be critical. Businesses’ capabilities in pooling Web analytics and social data and third-party data will be very important. Right now, agencies are in the early stages of what can be done in personalization, [such as] with CRM data. There’s very little of that going on compared to where we’ll be in five years’ time. Brands’ capabilities for personalization [are] very limited right now, but hopefully we’re at the forefront of making a lot of this happen.

What developments are you seeing in native advertising for mobile devices? In what ways are brands getting closer to scaling native ads?

Scale is still hard to get to in terms of operational efficiency. There are great initiatives from the likes of the IAB though in getting rid of reporting inconsistences, which is one of the key challenges. And the advent of strong third-party ad servers will hopefully be helpful in standardizing ad serving and metrics.

Overall, running display in mobile is still painful. There’s an inconsistent value chain and you’re going to get results that you may not feel as confident with as you would through standard channels. At the same time, mobile search is cleaning up because it’s consistent with the [traditional] online experience. I don’t mean just the operational stuff, where a planner can just buy it straight away, but also because it’s related to the desktop experience. The rest of mobile advertising still has a long way to go to counteract the advantages that companies like Google and Facebook have in these circumstances.

What mobile trends will be big during the holidays?

I think there’ll be a huge increase in the use of immersive and creative rich media for mobile this year. The potential is there for providing an experience that is richer and more attractive than an online experience. The click-through rates, open rates and expansion rates in mobile also make it worth doing. Smart retailers should be using rich media as a magazine format to inspire purchases and get people in stores.

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What are your thoughts on how advertising will fit in wearable technology like Google Glass and smartwatches?

For both of these wearables, there’s a location component in there. If you think of the platforms that people would use on it, those could be things like Yelp and Foursquare. If you’re walking around and you’re looking for places to go with your friends, Yelp or Foursquare might surface results and take you around Manhattan. The implication is that your investment and engagement with Yelp and Foursquare is going to be more interesting than a straightforward paid spot. We’re still probably years out from widespread adoption of things like Glass, but it’s something we have to have on our roadmap.

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