Banning the Banner Ad

 

millennials-want-to-be-treated-like-adults-in-the-workplace.jpgAs a longtime digital practitioner, I sometimes feel ashamed that I haven’t clicked on many banner ads in the last 10 years or so. It’s not that I don’t like banner ads. I recognize that advertising is the thing that supports all of the great content I read. I don’t even mind lots of ads in my paid, expensive, print and online versions of The Wall Street Journal – I sometimes even read them.

But standard banners rarely get any consideration or clicks from me, unless they are incredibly relevant. Standard banner ads aren’t particularly engaging – and the marketers buying them are getting frustrated with an ecosystem rife with fraud, technology taxes and nonhuman traffic.

Some of the world’s top marketers are actively working on “ban-the-banner” initiatives, driven by the theory that nothing but engagement matters – a KPI more easily correlated to watching an entire video than the much-maligned click. They believe great brands should tell great stories, so it seems obvious that the scant real estate and functionality offered by banner slots makes creating consumer engagement difficult, if not impossible.

At the intersection of an amazing technology-driven programmatic buying landscape and the increasingly creative social-led atmosphere of the new web is online video. It kind of snuck up on us, steadily creeping into our social feeds, blogs and favorite website destinations. That’s a very good thing: The reason linear television continues to command the lion’s share of media dollars is because people like to be entertained, and watching something is so much easier than reading something. Watching is a passive experience, but an emotional one.

Video is a place where brands can tell amazing stories, make a great pitch and drive consumer engagement. After years of perfecting 15-second, 30-second and one-minute spots, media agencies are eager to leverage their linear creative in new formats to reach audiences that seem to be abandoning traditional television in droves. This, coupled with a few other factors, is causing advertisers to rapidly move away from animated banners to video.

Millennials Don’t Like Television

Perhaps the most pressing dynamic forcing more video adoption among marketers is thatmillennials – who comprise an estimated 80 million-plus US consumers and will spend $200 billion next year – don’t really watch television anymore.

This is both from a delivery and physical dynamic; they do not watch video on television sets as much as they consume it on tablets, phones and other devices, and they also prefer on-demand viewing to scheduled programming. It makes sense. Even a 13” laptop with a retina display beats a 70” HDTV when held several inches in front of one’s face.

And the rise of streaming services has matured, giving consumers a legitimate option to “unplug” from traditional cable services and consume all the content they want on demand. Marketers must adapt to a reality that makes mobile the top priority for younger consumers, and adjust to the fact that many of the places millennials consume their content are relatively ad-free zones – at least in terms of traditional advertising units. It just so happens that video advertising fits into this new world nicely.

Time-Spent: The New Currency

If video ad delivery is going to be the mainstream unit, then it also follows that things like impressions and clicks are becoming irrelevant quickly. For video, the coin of the realm is time spent, and it is actually a pretty strong sign of engagement and valuable proxy for brand sentiment.

While it may be true that we are forced to consume some pre-roll before engaging with organic content, the best part of online video is that consumers waiting for content on their iPhones are much less likely to take a trip to the kitchen for a snack, as they do when standard commercials come on the tube. Instead of a solid three-minute block of commercials, they only have to engage with a single ad. Also, that ad can be tailored to individual preferences. That means even more engagement, less ad abandonment and a lot of measurability.

Data management platforms are helping marketers segment audiences that are prone to engage through an entire length of video and understand the types of content that produce longer viewing times and true engagement – and modeling those audiences to find lookalikes.

Linear And Online Video Must Connect For True Attribution

Probably the greatest thing about online video is the hope of leveraging data to connect online audiences with linear ones, and getting a better sense of media mix modeling and multitouch attribution.

Comcast certainly gets it. Connecting set-top box data with online ad serving means being able to touch a consumer with video across multiple screens – and bring real measurement of audiences that are increasingly device agnostic. Large telecoms, such as Verizon, are acquiring companies that provide the “last mile” of value from their broadband pipes, and that mile is as much about online video ad delivery as it is about website content.

The battle to do this correctly will be won at the “people level,” which is why we are seeing such a pitched battle of cross-device graphs; unless marketers can connect people with all of their devices, true attribution is simply impossible, rather than just being hard.

It’s an interesting time for modern marketers and publishers as they try and grow out of what we will see as the very early days of addressable advertising, and into a world dominated by on-demand content across a multitude of screens. The common denominator is video advertising, and I’m going long on the companies in the ecosystem that are going to power this new reality.

[This article originally appeared in AdExchanger on 6.30.16]

New Whitepaper: Agencies and DMP!

RoleOfTheAgencyInDataManagementWe’ve just published our latest best practice guide, entitled ‘The Role of the Agency in Data Management.’

The report looks at the challenges and opportunities for agencies that want to become trusted stewards of their clients’ data.

I sat down with the author, Chris O’Hara, to find out more.

Q. It seems like the industry press is continually heralding the decline of media agencies, but they seem to be very much alive. What’s your take on the current landscape?

For a very long time, agencies have been dependent upon using low-cost labor for media planning and other low-value operational tasks.

While there are many highly-skilled digital media practitioners – strategists and the like – agencies still work against “cost-plus” models that don’t necessarily map to the new realities in omnichannel marketing.

Over the last several years as marketers have come to license technology – data management platforms (DMP) in particular – agencies have lost some ground to the managed services arms of ad tech companies, systems integrators, and management consultancies.

Q. How do agencies compete?

Agencies aren’t giving up the fight to win more technical and strategic work.

Over the last several years, we have seen many smaller, data-led agencies pop up to support challenging work – and we have also seen holding companies up-level staff and build practice groups to accommodate marketers that are licensing DMP technology and starting to take programmatic buying “in-house.”

It’s a trend that is only accelerating as more and more marketer clients are hiring Chief Data Officers and fusing the media, analytics, and IT departments into “centers of excellence” and the like.

Not only are agencies starting to build consultative practices, but it looks like traditional consultancies are starting to build out agency-like services as well.

Not long ago you wouldn’t think of names like Accenture, McKinsey, Infinitive, and Boston Consulting Group when you think of digital media, but they are working closely with a lot of Fortune 500 marketers to do things like DMP and DSP (demand-side platform) evaluations, programmatic strategy, and even creative work.

We are also seeing CRM-type agencies like Merkle and Epsilon acquire technologies and partner with big cloud companies as they start to work with more of a marketer’s first-party data.

As services businesses, they would love to take share away from traditional agencies.

Q. Who is winning?

I think it’s early days in the battle for supremacy in data-driven marketing, but I think agencies that are nimble and willing to take some risk upfront are well positioned to be successful.

They are the closest to the media budgets of marketers, and those with transparent business models are really strongly trusted partners when it comes to bringing new products to market.

Also, as creative starts to touch data more, this gives them a huge advantage.

You can be as efficient as possible in terms of reaching audiences through technology, but at the end of the day, creative is what drives brand building and ultimately sales.

Q. Why should agencies embrace DMPs? What is in it for them? It seems like yet another platform to operate, and agencies are already managing DSPs, search, direct buys, and things like creative optimization platforms.

Ultimately, agencies must align with the marketer’s strategy, and DMPs are starting to become the single source of “people data” that touch all sorts of execution channels, from email to social.

That being said, DMP implementations can be really tough if an agency isn’t scoped (or paid) to do the additional work that the DMP requires.

Think about it: A marketer licenses a DMP and plops a pretty complicated piece of software on an agency team’s desk and says, “get started!”

That can be a recipe for disaster. Agencies need to be involved in scoping the personnel and work they will be required to do to support new technologies, and marketers are better off involving agencies early on in the process.

Q. So, what do agencies do with DMP technology? How can they succeed?

As you’ll read in the new guide, there are a variety of amazing use cases that come out of the box that agencies can use to immediately make an impact.

Because the DMP can control for the delivery of messages against specific people across all channels, a really low-hanging fruit is frequency management.

Doing it well can eliminate anywhere from, 10-40% of wasteful spending on media that reaches consumers too many times.

Doing analytics around customer journeys is another use case – and one that attribution companies get paid handsomely for.

With this newly discovered data at their fingertips, agencies can start proving value quickly, and build entire practice groups around media efficiency, analytics, data science – even leverage DMP tech to build specialized trading desks. There’s a lot to take advantage of.

Q. You interviewed a lot of senior people in the agency and marketer space. Are they optimistic about the future?

Definitely. It’s sort of a biased sample, since I interviewed a lot of practitioners that do data management on a daily basis.

But I think ultimately everyone sees the need to get a lot better at digital marketing and views technology as the way out of what I consider to be the early and dark ages of addressable marketing.

The pace of change is very rapid, and I think we are seeing that people who really lean into the big problems of the moment like cross-device identity, location-based attribution, and advanced analytics are future-proofing themselves.