The Problem of Ubiquity

Is Your Technology Offering Differentiated Enough to Win in the Digital Media Advertising Landscape?

Media buying desks are so 2009. I mean, who doesn’t have access to 800+ exchange inventory sources and 30 different 3rd party data providers?  In a world where well-heeled demand side customers have all of the tools to buy audience efficiently, how do internet marketers effectively communicate?

At this moment in time, digital display advertisers love the idea of audience buying because it seems unique. The concept of buying an audience, rather than the site it is on, is truly revolutionary and will be a continuing part of the digital media conversation for a long time to come. However, many technology companies are being funded, started, and run on the foolish misconception that audience buying vs. site-specific buying is a binary choice. It is not. Large holding company shops are trying to migrate client budgets over to their media buying desks, demand side platforms are trying to displace ad networks, and ad “platforms” are attempting to skim the media cream on all real time transactions by promising better performance through centralization. All of these tactics are doomed to fail.

Context

Unless you are going cheap and deep by buying remnant inventory at under $0.50 CPMs—or going data-heavy and spending upwards of $5.00 CPMs using segmentation to find highly specific premium audience—you are going to need context. In the former case (running wild with sub-$0.50 bids across exchanges) you face the issue of low CTR and the accompanying issue of low brand safety. Your ad is getting out there, but God knows where it’s serving. Then again, at $0.50, why not “spray and pray?” With machine learning, you can easily optimize against a conversion pixel, and let your bidding technology find all the performance that a cheap CPM can yield.

On the other end of the spectrum (using expensive V12 or Bizo segments, for example), you have a highly targeted audience—but a problem achieving scale against such specific targeting goals. Also, while you may be hitting your desired segment, you may be hitting them at the wrong time. As a frequent traveler, I have been frequently targeted with exactly the right ad (Cheap JetBlue flight to SFO) at exactly the wrong time (during my Yahoo! fantasy baseball draft).  Context does matter. Reaching premium surfers when they are engaged in consuming premium content is still relevant. That’s why people pay what they do for full page ads on the Wall Street Journal and that’s why WebMD will never accept “3rd party” advertising. Context matters, intent matters, and a user’s mindframe matters. When I am reading an article about Carmelo Anthony on ESPN.com, and I am in the market for basketball sneakers, I am simply more likely to buy them…because I am in a basketball mindset. Catch me with the same sneaker ad when I am replying to my friend on Hotmail, and it’s highly unlikely that I will break task and respond.

Engagement Methodology

Almost as important as context, is the way that an ad is served.  The majority of online audiences visit about three sites a day—and one of them is Facebook. It’s kind of tough to get into the media mix for the average site. There are two approaches the modern digital publisher can take can deal with this reality. The first is to SEO the hell out of their site, and drop enough tags to ensure an automatic, steady flow of exchange and network advertising. Another method is to firewall their exclusive content and only serve guaranteed advertising. Hybrid models are the norm, but publishers must manage the inevitable channel conflict and data leakage that come from opening up premium ad slots to networks and exchanges. Getting this blend right for websites is step one.

Modern publishers also have to go beyond the website. Today’s publishers are not only offering a blended approach to solving these marketing needs in modern RFPs—they are going beyond the typical RFP response to craft unique digital offerings that reach users that are engaged with digital content on multiple screens. You can’t effectively target pure audience yet on iPads, iPhones, or Android devices. Buy that’s where a lot of content consumption is rapidly shifting, Companies like Phluant (adapting online rich media ads of mobile browsing) are on the forefront of adapting display advertising to the new, mobile environment where they will be seen.

If your development plans do not include interoperability with the multiscreen media world we live in currently, then you are already becoming irrelevant. In the near future, there will be no such thing as “mobile networks” and “in-app” advertising. There will be platform solutions which enable cross-platform messaging (and accompanying analytics) in real time.

Price

A lot of the biggest mistakes modern media buyers make can be attributed to pricing. Todays’ digital media options do not lend themselves to a single RFP, with a static pricing range. The typical marketer looking to find high-income middle-age men who are “auto-intenders” may top out at $12 CPM. This is ridiculous. Marketers (especially old school direct mail marketers), know the value of finding their exact audience may be in the $100 CPM range (if they know they are reaching that exact, qualified customer), or it may be in the $1.00 CPM range (if they simply want to blanket my message to “men” in certain geotargeted area). Audiences are variable—but buying methodologies are not. In the near future, media buying will become programmatic, enabling marketers to populate a more robust RFP template with data—and receive systematic buying templates that span both buying methodologies (guaranteed and real-time) and pricing methodologies as well (CPM, CPC, CPA).

Choice

Today’s world is about choice. The modern digital marketer doesn’t have to face the straw man argument between choosing guaranteed vs. real-time audience buying; neither should he make the false choice of deciding between rich media and standard banners, when both can be deployed seamlessly across a single campaign. Moreover, it is now simple to leverage broadcast creative digitally, and run video advertising units on television, on the web, and on mobile devices simultaneously. As technology rapidly enables interplatform operability, marketers will be able to focus more upon the (all important) creative, than the delivery methodology itself.

As digital delivery systems evolve, marketers will live or die by the power of their creative to captivate. When technology companies finally enable marketers to broadcast their advertising across multiple digital channels at once (online display, video, mobile, DOOH, and cable set-top), the challenge will once again turn to creativity. In a technology-driven media world that enables marketers to produce and stream an advertising message seamlessly into the ether—it’s all about the ad, rather than where it is seen.

Up until now, the conversation in the space has been about delivering ads (by “DSPs” and RTB systems). As digital advertising delivery systems evolve, and every marketer has near ubiquitous access to platforms that enable scale and cross-platform delivery, the conversation is going to shift back to who is producing the best creative.

That’s a conversation I am looking forward to.

[This post originally appeared on 5/12/11 in eMarketing & Commerce]

Rise of the Machines

Where do People Fit into a World that Promises Endless Media Automation?

Ever since man tied a rope to an ox, there has been a relentless drive to automate work processes. Like primitive farming, digital media buying is a thankless, low-value task where results (and profits) do not often match the effort involved. Many companies are seeking to alleviate much of the process-heavy, detail-oriented tasks involved in finding, placing, serving, optimizing, tracking, and (most importantly) billing digital media campaigns with various degrees of success.

Let’s take the bleeding edge world of real-time audience buying. Trading desk managers are often working in multiple environments, on multiple screens. On a typical day, he may be logging into his AppNexus account, bidding on AdBrite for inventory, bidding for BlueKai stamps in that UI, looking for segmentation data in AdAdvisor, buying guaranteed audience on Legolas, trafficking ads in Atlas, and probably looking at some deep analytics data as well. If he is smart, he is probably managing that through a master platform, where he can look at performance of guaranteed display and even other media types. How efficient does that sound?

To me, it sounds like six logins too many. Putting aside the obvious fact that an abundance of technology doesn’t lead to efficiency (how’s “multitasking” working out for your 12 year old, by the way?), I wonder we aren’t asking too much of digital as a whole. How many ads have you clicked on lately? If the answer is zero, then you are in a large club. Broken down to its most basic level, we are working in a business that believes a 0.1% “success” rate is reason to celebrate. But the “click is a dead metric” some say. Really? Isn’t the whole point of a banner ad to drive someone to your website? When did that change?

All of this is simply to illustrate the larger point that the display advertising industry, for all of its supposed efficiencies, is really still in its very nascent stages. Navigating the commoditized world of banner advertising is still very much a human task, and the many machines we have created to wrestle the immense Internet into delivering an advertiser the perfect user are still primitive. For a short while longer, digital media is still the game of the agency media buyer…but not for long.

Let’s look at the areas in which smart media people add value to digital campaigns: site discovery, pricing, analytics and optimization, and billing.

Site Discovery

In the past, half the battle was knowing where to go. Which travel sites sold the most airline tickets? Which sites indexed most highly against men of a certain age, looking for their next automobile? What publisher did you call to get to IT professionals who made purchasing decisions on corporate laptops? Agencies had (and still have) plenty of institutional knowledge to help their clients partner with the right media to reach audiences efficiently and—even with the abundance of measurement tools out there—a lot of human guidance was needed. Now, given the ability to purchase that audience exactly using widely available data segments, the trick is simply knowing where to log in. I just found the latter IT professional segment in Bizo in less than 2 minutes. So the question becomes: how are you leveraging data and placement to achieve the desired result, and how efficiently are you doing it?

Pricing

It used to be that the big agencies could gain a huge pricing advantage through buying media in bulk. Holding company shops leveraged their power and muscled down publisher rate card by (sometimes) 80% or more with promised volume commitments, leaving smaller media agencies behind. Then, a funny thing happened: ad exchanges. All of the sudden, nearly all of the inventory in the world was available, and ready to be had in a second-price auction environment. Now, any Tom , Dick, and Harry with a network relationship could access relatively high quality impressions at prices that were guaranteed never to be too high (in a second-price auction, the winning bid is placed at the second highest price, meaning runaway “ceiling” bids are collapsed). Whoops. With their pricing advantage eliminated, large agencies did the next best thing: eliminated the middleman by building their own exchanges, which we have been calling “DSPs.” So, you don’t need human intervention to ensure pricing advantages.

Analytics and Optimization

What about figuring out what all the data means? After all, spreadsheets don’t optimize media campaigns. Don’t you need really smart, analytical media people to draw down click- and view-based data, sift through conversion metrics, and build attribution models? Maybe not. Not only are incredible algorithms taking that data and using machine learning to automatically optimize against clicks or conversions—but programmatic buying is slowly coming to all digital media as well.  In the future, smart technology will enable planners to create dynamic media mixes that span guaranteed and real-time, and apply pricing across multiple methodologies (CPM, CPC, CPA). Much of that work is being done manually right now, but not for long.

Billing

Sadly, much of the digital media business comes down to billing at the end of the day. Media companies struggle tremendously with reconciling numbers across multiple systems, and agency ad servers don’t seem to speak the same language as publisher ones. The bulk of a media company’s time seems to be spend just trying to get paid, and an incredible amount of good salary gets burnt in the details of reconciliation and reporting. This is slowly changing, but the advent of good API development is starting to make the machines talk to each other more clearly. The platforms that can “plug in” ad serving and data APIs most easily have a lot to gain, and the industry as a whole will benefit from interoperability.

So, are people doomed in digital media? Not at all. There are going to be a lot less digital media buyers and planners needed—but what agencies are really going to need are smart media people. Right now, you need 4 people to manage 10 machines. In the near future, you will need 1 smart person to manage 1 platform—and the other three people can focus on something else. Maybe like talking to their clients.

[This article originally appeared in ClickZ on 4/14/11]

SalesRants 10: The Hardest Sell of Them All

No stranger to the hard sell, Secret Sales Guy still has morals enough to question a rep who trades on her looks to land a big sale.

Pushing the Applecart
When it comes down to it, I really enjoy my profession. I get up in the morning, shower, put on a collared shirt and crack open my Wall Street Journal, secure in the knowledge that I am doing my small part for the American economy. Even on a bad day, some commerce will be transacted. Big Media Company will make a few bucks, an electronics company will sell a few more devices, our beloved and faithful readers will have another issue to peruse at their desks, and I will make a few bucks myself. Happiness all around.

Media sales can be complicated, though. There are existing clients to stay on top of, new business to hustle up, agencies and PR firms that need attention, publishers to please, and salespeople and editors to manage. Every month, a million things have to come together seamlessly so a nice, profitable, ad-filled issue can hit the mail. Invariably, things get complicated between the publication of the month-by-month editorial calendar and the actual time the issue appears in readers’ hands.

But when you get right down to it—where the ink meets that gauzy 70 lb. sheet of magazine paper stock—it’s all about pushing the applecart.

Like the street vendor of old pushing his wares down a busy street, hawking fruit to a newly arrived immigrant population, the media salesman is—at his very core—a simple man. He has products to sell and families to feed. Sometimes, his produce isn’t the freshest on the street, either. But sell it he must, to both longtime customers and new prospects alike. Won’t you please sample my wares? Feel the firmness of my apples today, Mrs. Giancotti. See how the thin veneer of wax I have rubbed into the skin gives them a shine? Won’t you please take six of my apples to your dear mother, as well?

It’s enough to make you puke.

 

When you’re rolling down a trade show aisle, outfitted in your Sunday best and trying unsuccessfully to elicit the name of a marketing manager from some logo-happy, golf shirt-wearing computer salesman, you almost wish you were a street cart vendor. You may not be sporting a Hermè’s tie and $200 loafers, but at least you get the sense that somebody, somewhere out there, wants a fucking apple.

But hunting down new prospects is part of the job, isn’t it? Who the hell’s the new guy at Sony? Well, you had better find out, because you can bet your bottom dollar that No. 2 Industry Magazine already knows. For God’s sake, they’re probably already in his office chatting placement over a macchiato. So you push that applecart, hat humbly in hand, and lurk near Sony’s trade show booth like a loser, waiting for the sales guy to free up so you can ask him who’s in charge of print advertising. That’s the way it’s done.

One mealy apple at a time.

Spreading for a Spread?
Editorial staffers sometimes cross over to the advertising side of publishing (your Secret Sales Guy being a living, breathing example). When they do, it’s not uncommon for them to hear their editorial brethren claim that such a move means they’ve automatically exchanged their upstanding editor’s soul for a commission check. Granted, this journey to the “dark side” doesn’t happen often but, when it does, is the traveler entering previously forbidden territory? Will a former ASME member in good standing trot traverse roads lower than those of his editorial cohorts, set up shop at the bottom of the moral barrel, and start selling like the tramp he’s secretly always been?

In other words: Is there any truth to the notion that sales is a whore’s game?

Personally, I can tell you that I have never traded my integrity for the price of a hefty commission—but, then again, I’ve never had the opportunity to sell an $80,000 page of advertising. I can tell you what Secret Sales Guy has seen over the course of ten years in business media, though. I can relate this story from a recent trade show.

Back in January, I received a surprise phone call from our Midwest representative. An attractive woman in her mid-thirties, Judith* commanded men’s attention for her looks, as well as for her obvious sales prowess and industry knowledge. Giving notice, she told me she was leaving No. 1 Industry Magazine and going to No. 1 Consumer Magazine. It was a major leap and an opportunity to nearly double her salary. Underpaid corporate wage slave that I am, I was simultaneously delighted for her and wracked with jealousy, since I would have sold my mother for that position. Judith’s departure was a tough loss, but what could I do? Big Media Company wasn’t exactly forking it over in terms of salary, and Judith had put in two excellent years —capped by two disappointing raises. Go with God, Judith.

Well, who do I encounter at the first trade show of the year? Not Respected Judith, who men yearned for, since she was more untouchable than a 30 percent discount off our rate card. She’d left the building. Instead, I met up with Saucy Judith, the hard drinking, client-cuddling, giddy slut who, despite her two years at Big Media Company, I had never encountered before…

Was Judith married? Yes. Was her thigh and upper ass now firmly planted in the crotch of the guy who could give her the biggest account of her career? Check.

Watching Judith wrap her legs around Tom Black, the marketing manager of Gigantic Software Company, took me by complete surprise. I had to check the old internal memory banks. Was Judith married? Yes. Was her thigh and upper ass now firmly planted in Tom’s crotch ? Check. What the hell was I seeing? A formerly demure and subtle business media sales representative draping herself all over the biggest customer in the room, trading on her good looks and overly available flanks—the living embodiment of the nightmarish slide into the true dark side of consumer media, where the page rates are big, the custom media projects are bigger, and the sponsorships are biggest of all.

My new Midwest rep and I witnessed all this from the bar in the hotel lounge. According to her, sales were down at No. 1 Consumer Mag, and someone was having a difficult transition going from trade mag to “real” mag. Also, Judith was now surrounded by a bevy of younger (and, frankly, hotter) reps in their twenties, who didn’t shy away from the occasional flirtation—or more—to secure an ad schedule. Life at No. 1 Consumer Mag came with some serious pressure, a big expense account, and plenty of internal competition.

I was now feeling a mix of emotions: sadness, for this once-proud colleague now mired in an ethical hell; fear, because this piranha of the print ad was gnawing on one of our biggest clients; and joy, because in some sick way I loved watching the late-night sales effort that the New Judith was putting out.

“Think Tom’ll get any tonight?” I ask New Midwest Rep.

“Nah,” replied New Midwest Rep, “She’s not giving it up.”

“How do you know?” I asked.

New Midwest Sales Rep, single and quite the looker herself, faced me and smiled. “Because I’m meeting him later tonight,” she said.

We high-fived and turned back to the bartender for another round of vodka-and-Red Bull. Let Judith cozy up to Tom late into the night and pay his bar tab. No. 1 Industry Mag had the inside track on Humongous Software Company, and that’s the way this trade show cookie crumbled. Better luck next time, New—but far from improved—Slutty Judith.

[This post originalyl appeared in MediaBistro, 8/2/2006]

SalesRants 8: Stage One=Denial

How big of a deal is it really when a huge account falls through? Secret Sales Guy’s about to find out

A Salesman Runs Through It
Besides teaching me fun, homespun, business-related jargon such as “all sizzle and no steak,” and “let’s chuck some jelly at the wall and see what sticks,” my first Publisher taught me something pretty valuable about the business.

“Sales Guy,” he said, “What does a tea bag string manufacturer in India, a coffee grower in Guatemala, a Starbucks owner in Baton Rouge, and a manufacturer of coffee roasting machines in Dusseldorf have in common?”

“Beats me, Boss,” I answered, “They are all B-level prospects?” At the time, I was working for a business magazine about the retail coffee business. Boss looked at me with barely hidden exasperation — and some pride. He was training me, a former senior editor, to be a salesman.

 

“Yes, and no, Sales Guy. You see, these people have absolutely nothing more in common — besides being in the coffee industry — than the fact that they read Retail Coffee Journal,**” he said. “They may never meet, but every month they look forward to reading our magazine and catching up on the latest news. We are their lifeline to the industry, and we are the strongest community they are a part of.”

The information was, frankly, somewhat stunning. Did over 50,000 people with a tangential relationship to the coffee business really depend on RCJ to bind them together? Was the CEO of the Singapore-based coffee export company sitting on the throne for his morning constitutional and reading it at the same time the Honduran plantation owner was leafing through RCJ with his evening Cuba Libre? Amazing. The idea that our small business magazine was influencing and binding this disparate community together was intoxicating.

As our new sales guy — armed only with an outdated media kit, a BPA statement, and a corporate AmEx card capped at $4,000 –I was going to be the brand ambassador for RCJ. I would be an intrepid man on the street funding our wise editorial one $6,790 net page of advertising at a time, until the entire coffee industry was bound under our glorious banner. While I was at it, I would also collect a copious amount of airline frequent flier miles, and have the opportunity for much duty-free shopping. It was the ultimate dream: a way to be on the business side of publishing, and also work for the greater good.

The dream lasted until Guatemalan coffee roaster went 120 days past due on his first two pages of advertising, slashing my September commission check in half. There were a few more bad apples in the “community” as well, leading me to believe that the international nirvana of RCJ was more like a melting pot of mediocre businesses all struggling to make a buck off of Starbucks. The airline miles kept adding up, though. But after a few swings through industrial centers in Germany, Central America, and the midwestern United States, the glory of “international travel” has diminished faster than the balance in my Chase account.

Lord, help me believe again.

Stage One=Denial
We lost a big one today: Big Electronics Company decided to pull the plug on Project New Media, a $300,000 whammy of a sponsorship with more bells and whistles than my daughter’s new tricycle. It had everything: print, online, live events, Webcasting — the works. It was the project that proved #1 Industry Magazine was more than just the leader of the pack in terms of market share — we were a cutting-edge Publisher, ready to “deliver the leading edge in content-based marketing.”

The saddest part is that our plan worked. We produced beautiful advertorials about Big Electronics Company’s latest equipment. We built them a Web site with famous people using their gear. We packed auditoriums full of enthusiastic business consumers, ready to get the latest technical information about their products, and offered them a “hands-on user experience” with Electronics Company’s latest products.

We delivered ROI like nobody’s business, too. Mailing lists, online statistics, survey data, user feedback, banner ad stats. You name it, we had it. Then we sat down in front of Big Electronics Company with our Powerpoint, ready to get our renewal (the net cost of which had already been factored into our fourth-quarter P&L), and got the Heisman. The big “talk to the hand.”

What happened?

New Guy was in charge now, and he had other ideas about Big Electronics Company’s marketing. Our ambitious program wasn’t his idea, and therefore he wouldn’t get enough credit for its success.

Well, it turns out that the guy we sold this albatross of a program to got canned, walking off into the sunset with an early retirement package and a consulting job. New Guy was in charge now, and he had other ideas about Big Electronics Company’s marketing. He was going to “shake up the team” and “bring in some new blood” to their stodgy, yet reasonably effective, business media plan. Bottom line? Our ambitious program wasn’t his idea, and therefore he wouldn’t get enough credit for its success.

I haven’t told the team yet.

[This post originally appeared in MediaBistro, 7/17/2006]

SalesRants 6: Big Media on the Block

B2B publishing outfits are being sold left and right—is Secret Sales Guy’s next?

Thank You for Your $upport
Let’s be honest, shall we? Secret Sales Guy (SSG) didn’t leave his comfy editorial position to go into sales because he loves it. No, sir. Secret Sales Guy has a cute wife who didn’t grow up on the Lower East Side—a wife who expects a regularly scheduled manicure, pedicure, and dye job. He also has two lovely children, who expect and deserve an education at the college of their choice (well, since they’re only in preschool, let’s just assume that they’ll expect it soon enough).

In fact, ever since leaving New York city, Secret Sales Guy has seemed to inherit two of everything: two kids, two cars, two dogs, and even a manly pair of love handles. Let’s not forget the monthly commuter pass, Metrocard, lunch money, school payments, babysitting, and anything and everything else that requires a modest amount of bread to capitalize. Anyway, you know the next part. SSG now has to find a way to pay for all of that so he can stay married, keep oil in the burner, and eat meat at regularly scheduled intervals.

 

In publishing, keeping this whole enterprise afloat ain’t too easy. At the very low end of six figures, I occupy a fairly annoying demographic position: people who are statistically “rich” but, by East Coast standards, live a fairly cash-strapped and frustrating existence. Despite the fact that the monthly commission check has been fairly chunky of late, most of it is well spent before it hits my bank account, and there’s a long list of people lined up to take a piece of it. Luckily, SSG has been lucky in real estate (like everyone else), so he knows that upon death, there may be something for the family to fall back on. For now, it’s root, hog or die.

So, dear reader. don’t underestimate the casual way SSB approaches sales. He may appear nonchalant, but that next big program he sells you just may mean the difference between pasta and beer versus a nice ribeye and a decent bottle of Cabernet. Agencies and clients: Won’t you please support SSG?

The Friendly Buys
I just read that a bunch of private equity guys finally bought a big competitor of Big Media Company, Dutch publishing conglomerate VNU. The owner of Nielsen (the TV ratings people), AdWeek (the well-written, yet somehow annoying media magazine), and a bunch of other prime periodicals, data companies, and trade shows. My beloved Big Media Company is probably champing at the bit to do the same. With print sales taking a bath and new media money not pouring in for publishers like everybody said it would, it’s time to get the hell out. Or, maybe, time to buy something else.

Coming on the heels of other groundbreaking B2B media deals, VNU’s sale was no surprise. Those private equity guys are about as gentle as an 18th century proctologist, to boot.

Coming on the heels of the Primedia deal, Hanley Wood, and some other groundbreaking B2B media deals, VNU’s sale was no surprise. Those private equity guys are about as gentle as an 18th century proctologist, to boot. Thomas H Lee, KKR, and Blackstone Group are all about the people, aren’t they? I can picture them, sitting around the old Polycom conference call unit, big jugs of Voss designer water in front of them, talking about how they can improve the company health plan and add an extra percentage point or two to the 401K matching contribution.

We’ll see how long it takes them to lop off a few choice divisions, and I wouldn’t be surprised if my beloved Big Media Company doesn’t end up with a few of them. You know what they say: If you can’t grow revenue on your own, you can buy your way into some. Buy a few mags, fire all of their back-office and production staff, and double up your own staff’s workload. Same fixed costs—double the productivity!

Sure, you’ll lose about 25 percent to attrition, but the job market’s tough for the low-end employee, and there are plenty of folks out there willing to brave a four-hour round trip commute to make $35,000 a year. Now you’re talking about real margins. The important thing is, what does this mean for your loyal and dedicated Secret Sales Guy? Will I get another magazine to run? Will Big Media Company follow VNU’s lead and start shopping my magazines around? Stay tuned…

[This post originally appeared in MediaBistro, 7/5/2006]