How JC Penney Extracts Transparency From Its Agency Trading Desk

JC Penney AccuenJC Penney knows what part of every programmatic dollar goes to the media seller, ad server, anti-fraud and viewability vendors, data providers and agency trading desk – and it’s still enthusiastic about programmatic.

“Accuen has recognized that we can’t not be transparent with where costs are going,” said Rose Sumrall, the senior marketing manager for display at JC Penney, at the Programmatic I/0 conference in New York on Thursday. “Marketers are not accepting that [black-box] response anymore.”

“Margins and agency fees can seem high, but when they break it down for you where everything is going, it makes more sense,” Sumrall said.

“Now we can have better conversations about those other fees that maybe aren’t truly working media dollars, but you can’t live without,” said Jeffrey Matisoff, regional marketing director for Accuen.

One way that many marketers are taking back control is by keeping their data in-house, but letting the agency execute.

JC Penney isn’t interested in evaluating and negotiating each vendor relationship, citing that as a big value in having an agency. But Sumrall and JC Penney’s lawyers do get involved whenever a technology partner uses personally identifiable information (PII) coming from JC Penney, because it wants to protect its customers’ privacy.

While that setup gave JC Penney more control and transparency over the use of proprietary data, it caused another problem: Those who needed to sign off on the data didn’t truly understand programmatic and why they needed to use PII for marketing.

“Procurement managers and privacy executives don’t live in our world,” Sumrall said. “You get this blank face that’s perplexed and doesn’t understand why you’re asking for approval.”

To solve for this problem, Sumrall has conducted “programmatic 101” meetings with the privacy, legal and procurement teams in order to get corporate buy-in for data-driven campaigns.

Now that JC Penney can trust its agency trading desk, it’s rethinking whether its role should be limited to execution. JC Penney works with a media agency for strategic planning across all channels, but they have limitations in how they can design a workable programmatic strategy,

As JC Penney tests an always-on approach to programmatic marketing, it plans to lean on the agency trading desk, not the media agency, for strategy.

“The media agency doesn’t have the knowledge that I need to come up with the best strategic approach, to come up with what’s the right bidding strategy, who are the right data segments to go after and what the dynamic creative looks like,” Sumrall said. “The trading desk will essentially become an agency.”

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