Both Polar and the new Nova business are profitable, he said, and Nova’s growth rate during a challenging macroeconomic backdrop is evidence that the opportunity is ripe.
“Clients are not looking for, nor do they believe, that one provider can do it all,” Gupta said. “It pays to focus and specialize. One product, one client segment.”
Before the spinoff, the buy-side technology now housed within Nova was used by around 5,000 brands to activate 12,000 campaigns in more than 30 countries in the past year. IPG’s Matterkind (formerly Cadreon) alone used the Nova social display product to run 900 campaigns for 250 clients in 22 countries during that time.
“This past year has taught marketers about the need to be adaptive and resilient when the world is changing so rapidly,” said Sean Muzzy, president of Matterkind.
But the pandemic aside, there’s been a long-standing challenge over the past decade by which “creative innovation on the open web has lagged the walled gardens,” Muzzy said.
There are multiple, interrelated reasons for that.
One, Gupta said, is that the social walled gardens – Instagram, Snapchat, Twitter, et al. – have their own proprietary ad units with specific size, length and quality specifications to adhere to. Advertisers spend a lot of time meeting those requirements for all of the different platforms.
“Marketers have to hop from one walled garden to another redoing creative,” Gupta said, “and by the time they get to the web, aka banner ads, they have little budget and no time, interest or enthusiasm left.”
That’s why you don’t really see anyone winning awards or getting promoted for creating an inspiring banner ad.
“I mean, who gets excited about designing a 320x50 banner,” Gupta said.
But there’s also another more nuanced dynamic at play, which is the nature of social algorithms.
Facebook, for example, factors engagement into the way it prices impressions in its auction, which means brands are incentivized to make their creative as engaging as possible or risk having to pay more to reach the same audience than a different brand with more engaging ads.
“That’s not the case on the web, where brands compete at the same CPM,” Gupta said. “Whether people realize it or not, there is an economic incentive, benefit and a structural advantage when creative is built for social versus the web.”
And without creative standardization, efficiency will remain elusive.
“Marketing depends on maximizing the distribution of creative, otherwise brands are limited in their reach or by the costs,” Gupta said, pointing to the creative standards that brands and media owners have long adhered to across TV, print, radio, outdoor and the open web.
The silos and friction in how media is bought and sold today can lead marketers to a channel-first rather than a people-first mentality, said IPG’s Muzzy.
“Creative needs to be built for people, not channels,” Muzzy said. “Nova helps Matterkind break down those silos and bring addressable, people-first solutions for creative to clients.”
Nova has 75 employees in 16 countries, more than half hired in the last six months. The Polar business is supported by 35 people. Gupta said he plans to invest in both businesses over the year to come in order to accelerate growth.
External funding isn’t in the cards as both business lines are currently profitable, he said.