Dstillery (Formerly ‘Media6degrees’) Closing In On Profitability

Tom Phillips, CEO, DstilleryLast month Media6degrees  rebranded itself as Dstillery. Why?

For years, Media6 had sought to position itself as a finder of consumer prospects for brands. From the beginning, it created audience segments based in part on social characteristics. But over the years that led to confusion: Was Media6 just another “social graph targeter?” No, that was never the point.

The company acquired mobile data firm EveryScreen Media in July, which broadened its analysis of consumer browsing beyond the use of cookies by incorporating location-based data. As CEO Tom Phillips said, the company can now more fully synthesize the digital “signals” it collects and better distill them for advertisers. In the meantime, the company has grown from 87 staffers last year to 110 currently (it expects to make four more hires by the end of this year in sales and account management) and is closing in on profitability, describing itself as “roughly break even” at this point.

Phillips spoke with AdExchanger.

AdExchanger: Why did Media6degrees change its name? How does this reflect the new focus?

Tom Phillips: In part, it reflected the new capabilities after we acquired EveryScreen Media in July. It effectively doubled, and in some cases tripled, the data that we can access. And it clarified how we had moved on from our original model, which was based on analyzing and targeting users based on their behavior in social networks.

We’re getting into more location-based targeting, such as finding good prospects based on browsing behavior across devices. Our ability to ingest mobile data that is geo-enabled gives us a targeting strategy that provides an additional dimension to what we can offer.

Some of our biggest customers are hotel chains. For any one of those travel marketers, they have multiple brands and products that are related. One way to find business travelers is through people who book online and then, by discerning activity in browsers, find people who are like them and are doing a lot of the same things. So we can find a million in that first category and then 10 million more in the second. That’s been our traditional approach.

Now, we can go back to Marriott or JetBlue and say that we’ll keep doing that, but that we’re also going to look for people in airports in your particular city.

How has the initial proposition around the use of social media to suggest audience segments of Media6 evolved when it comes to the changes at Dstillery?

The early idea was about looking beyond the typical demographic profiles to examining behaviors of like-minded people through the prism of social. But it was never about looking at the social graph or serving ads on social networks. It was about learning something strategic about consumers. Once we had figured out the way a certain group behaves on the web, we could extrapolate that out to who the future customers are going to be. The technology we ended up developing in 2008 was based on the notion that customers of a brand are going to do things on social networks that will distinguish them from a random audience. So we zero in on the things they do differently from that average to give us a profile.

How did the acquisition of EveryScreen expand that perspective?

We were looking at social networks and the company was named Media6 for that specific purpose. That legacy stayed with us up until last month when the acquisition for EveryScreen was completed. We always had a very robust view of Web-browsing behavior.

But the difference with EveryScreen is that we can take the advertising campaign parameters of a major marketer and address them a bunch of different ways, particularly in going beyond relying on cookies, mainly by looking discreetly and anonymously when it comes to pulling in location data from PC to tablets to mobile.

In terms of defining what Dstillery is, our expertise is driving that signal from massive data sets and using that to run ad campaigns across all media. We’re looking for that source of that signal wherever it’s available.

Who are your main clients? Do you work with the sell side at all or are you strictly demand side?

We never worked with publishers, never had an ad network. Our entire inventory is on the exchanges. We generally work with the marketers and occasionally with the agencies. We’re not selling or managing data – that’s not our business. Data is our fuel and we have an internal data-management platform. We also have our internal demand-side platform, which puts direct bids into all the exchanges. We also ensure quality inventory, detect fraud, to manage frequency.

Unlike a DSP, we don’t tell clients to bring their own data and we’ll execute the campaign. Our value proposition is that we have all these tools around data and bidding, we will run the campaign and deliver results. We’re not here to take orders based on someone handing us list of auto intenders. Instead, we’ll say to a car company, “Let’s talk about what you’re trying to do. We’ll find the right audiences and the other people who behave like them.” Maybe it’s people who have signed up for a test drive online. We’ll take that bucket and we’ll deliver a 10x, 40x, 100x audience number.

As a performance specialist, do you think these new abilities will have any appeal to branding campaigns? Or does the work you do remain mostly about direct response?

It can benefit branding campaigns. But we’re still in a world where we’re held to showing where we can deliver lift on sites. Even if it’s an awareness campaign, which is upper-funnel, you want to show that you’ve generated interest in your brand. The best measure we have for that is when people start showing up to your website as a direct result of seeing an ad.

As I said, one of the beauties of our new approach is that it’s not cookie-based at all.

Having the crosswalk capability to associate smartphones with laptops and tablets is critical. But for the most part, clients interested in our display campaign tools are focused on the PC, which is where most display ads still look and work best.

What’s Dstillery’s business model based on? How do you charge clients?

Pricing is mostly on a CPM/impression basis. But it also has to show a result based on ROI, which is how we’re ultimately evaluated by our clients. That’s true for Facebook, for video, traditional display. And it’s the way most marketers understand the purchase of advertising.

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