As TechCrunch reported last week, Gannett may acquire social marketing platform Blinq Media for approximately $92 million. What will it get for its money?
The short answer: a nice slice of Facebook marketing spend. Blinq Media is a marquee vendor in Facebook’s Preferred Marketing Developer program, holding badges in both the Ads API and Insights categories. This is significant because while there are 20 firms that hold the Insights badge and fully 49 that hold the Ads API badge, Blinq is one of just seven PMD companies to carry both.
But that doesn’t tell the whole story. Even within the Facebook Ads API playground, there is considerable variation between the companies, their service offerings, and target customers.
AdExchanger spoke with David Williams, Blinq Media CEO, before the TechCrunch report was published.
What do you think of the sheer number of companies that are now PMDs on the Facebook platform? Is it hard to compete?
A group of them is based on pure performance-based advertising. We also see a lot of these more traditional companies, like the search firms – Marin Software, Efficient Frontier, IgnitionOne and Kenshoo. They’re looking at it more to drive traffic off the Facebook platform and put them into these attribution models, and then optimize to the highest overall return for their search customers. It’s more of a return on advertising spend model.
Our focus is much more oriented around treating Facebook as an engagement platform, and serving the agencies.
Who do you think the buyers are going to be for the next wave of social marketing M&A?
Obviously, the media companies are very interested. Google is one of the biggest out there. I think it’s yet to be determined who the big players are going to be in the space, but I don’t think it’s going to be coming from the agencies. I think it’s probably coming more from the media company side of things.
Some of the companies are already embedded with these big brands or big agencies in delivering scalable media solutions for them. That’s the Salesforce/Oracle angle. It’s a big opportunity for them. I’m just not certain they’re in the position to take advantage of it as quickly as some other companies out there.
Really, no agencies? Even WPP, which is known for buying lots of ad tech?
A lot of these big agencies from holding companies are a little hesitant to pull the trigger at this stage in the industry. They feel like they’re still experimenting, testing out some of these API companies. They really don’t want to commit to one partner yet. Generally, they tend to invest more on the reporting and analytics side.
Will Ads API companies like Blinq Media increasingly compete with the DSPs that are allowed to access the Facebook Exchange?
We see the exchange fitting in very well with the approaches we’re taking because we’re engaging these consumers very early on in the life cycle. I think by isolating it… it’s not really looking at the opportunity from a bigger, longer-term vision. That’s where I see the API partners really fitting in, in terms of driving engagement, working to [leverage] the social graph and then finally completing that conversion process by understanding what’s happening off of Facebook.
That piece of the business is in such the early stages. I do think it’s a huge opportunity, but there is a lot more that’s going to play out there, longer term, in terms of what it will look like. I feel like we are in a strong position to take advantage of that inventory, much more so than a DSP. Having these pieces integrated is super-important for the advertisers, for Facebook and for these API partners, as well.
How well do Facebook mobile ads perform, and how fast do you see mobile inventory increasing?
The mobile piece we’ve just released within the technology over the last month. What we’ve seen so far is really outstanding performance, especially as related to click-through rates and any sort of engagement metrics. The click-through rates on the lower end are 1 to 1.5 percent, but the higher end we’ve seen up to 8.5 percent. One of our clients, Costa Rica Tourism, has click-through rates as high as 8.5 percent for that campaign.
The one limitation we’ve seen is that Facebook is really limiting the frequency of these ads so we haven’t seen the volume we would like. Although they’re performing really well, it’s difficult to scale. Obviously, we expect them to open that up more, going forward. But since it is a Sponsored Stories add unit, it is contingent on having a large fan base or a lot of engagement with brands to allow us to deliver it in a more scalable way.
What about premium ads coming into the API environment? What’s the significance there?
That’s huge, too. That’s what we’ve been waiting for all along. The biggest thing we’ve seen in the past with Facebook is this big separation between the Premium inventory and marketplace. I think, historically, that almost put the API partners in conflict with their direct sales team with selling to the agencies and to brands.
Now, by integrating everything within the API ecosystem, it allows these larger brands that are spending a lot on Premium ads to integrate their efforts from a targeting and creative perspective, and really give them one dashboard to look at everything — versus having to work with a sales team to plan and optimize Premium. It just seems like there’s a lot of inefficiency there. By working with the API teams, they’re able to extract a lot more value as it relates to targeting, as it relates to creative rotations and any insights that are made on the marketplace can then be carried over easily as a Premium ad.
We’re really focused on working with agencies. That’s our primary focus, which I think is quite different from a lot of the other API companies. Our focus is linking our technology to the agencies and also supporting them from a managed services perspective. Having access to premium and mobile significantly increases our value proposition to our agency partners.
