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Digital Transformation Or Disruption?
 

Digital Transformation Or Disruption?

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From the IAB/DataXu webinar: "Digital Transformation or Disruption? DSPs, Digital Advertising, and the Changing Role of the Agency"

From the IAB/DataXu webinar: "Digital Transformation or Disruption? DSPs, Digital Advertising, and the Changing Role of the Agency"

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Digital Transformation Or Disruption? Digital Transformation Or Disruption? Presentation Transcript

  • Digital Transformation or Disruption?
    DSPs, Digital Advertising, and the Changing Role of the Agency
    Hosted By:
  • Agenda
    Introductions
    Industry Overview
    DSP Learnings & Key Requirements
    RTB & Premium Inventory
    Branding vs Performance
    Success Stories
    Q&A with panelists
    © 2010 DataXu, Inc. Privileged & Confidential
    2
  • Participants
    © 2010 DataXu, Inc. Privileged & Confidential
    Steve Weeks, Sr. Manager of WW Advertising
    Mike Baker, CEO
    Michael Jenkins, Sr. Communication Strategist
    Ben Trenda, VP of REVV Marketplace Development
    3
  • Agenda
    Introductions
    Industry Overview
    DSP Learnings & Key Requirements
    © 2010 DataXu, Inc. Privileged & Confidential
    Mike Baker, CEO
    4
  • The Evolution of Online Media Buying
    Direct from Publishers 1996 
    Ad Networks1998 
    Ad Exchanges2005 
    DSPs2009 
    © 2010 DataXu, Inc. Privileged & Confidential
  • Demand Side Platforms
    What is a DSP?
    DSPs are media buying tools that help buyers aggregate, bid on, and optimize digital inventory across ad exchanges and yield management platforms.
    Advertiser Benefits:
    • Improves display ROI
    • Reduces display cost
    • Generates data-driven consumer insights
    © 2010 DataXu, Inc. Privileged & Confidential
  • The Role of a DSP
    Ads
    Placements
    Online display
    exchanges
    Publisher
    Advertiser
    Agency
    Online video
    exchanges
    DSPs
    Mobile
    exchanges
    Consumer data aggregators
    Audience
    © 2010 DataXu, Inc. Privileged & Confidential
  • Your buyers are moving targets
    © 2010 DataXu, Inc. Privileged & Confidential
    YESTERDAY’S CONSUMERS…
    • Passive media consumers
    • Static in place and time
    • Analog and settled
    YOU NEED TO…
    • Go where your audiences go
    • Break through scale limitations
    • Span display, mobile, and video
    TODAY’S CONSUMERS…
    • Active content co-creators
    • Fragmented in space and time
    • Digital and nomadic
  • 1st generation DSPs were a step in right direction
    © 2010 DataXu, Inc. Privileged & Confidential
    BENEFITS:
    • Better ROAS
    • More control
    • More efficient
    • Represent buy-side interest
    LIMITATIONS:
    • Fixed rule buying
    • Poor scalability of retargetingand audience buying
    • Cost effectiveness
    AUDIENCE BUYING
    RETARGETING
  • AUDIENCE BUYING
    RETARGETING
    The biggest problem with 1st gen DSPs: SCALE
    © 2010 DataXu, Inc. Privileged & Confidential
    REACHES ALL CONSUMERS
    Use insights from your own data to scale across display, mobile and video
    AUDIENCE DISCOVERY
    LIMITEDby the number of cookies you can buy
    LIMITEDby the number of people who come to your site
  • DataXu’s Next Generation Platform
    sd
    © 2010 DataXu, Inc. Privileged & Confidential
    LEARNS
    FROM WHAT’S WORKING
    1.
    2.
    MEASURES
    CONSUMER
    BEHAVIOR
    BUYS
    MEDIA ACROSS
    CHANNELS
    AND FORMATS
    DECIDES
    WHAT CONSUMERS,
    CONTEXTS, CREATIVES,
    AND PRICE
    4.
    3.
  • Why Dynamic Decisioning Matters
    © 2010 DataXu, Inc. Privileged & Confidential
  • Learning: Price VolatilityFavors Dynamic Bidders
    Results:
    Persistent price volatility is enabling advertisers to capture high value at low cost. Over 100% volatility --10 times higher than NASDAQ’s
    Conclusion:
    Dynamic decision systems that adjust in real time can boost performance
    Challenge:
    Decide, in real-time what ads to buy, adjusting to extreme price variation
    © 2010 DataXu, Inc. Privileged & Confidential
  • Learning: Creative Optimization is Key
    Challenge:
    Maximize campaign performance, targeting across Creative, Consumer and Context
    Results:
    Deciding on right creative for each ad was most important on 48% of the campaigns
    • Yet, on a significant number of campaigns, it was either Context or Consumer
    Conclusions:
    Best approach is to use the data, and automatically adapt
    • One-size-fits-all, rigid approaches are always doomed
    • A global optimization approach balances all three domains at once
    © 2010 DataXu, Inc. Privileged & Confidential
  • Learning: Optimization offers efficiency at scale
    © 2010 DataXu, Inc. Privileged & Confidential
    15
    Challenge:
    Optimize media buys to find the right media at the right price
    Results:
    The cost of media for Audience Targeting is 3X more expensive than ROE
    • But effectiveness as measured by CPA was 2.7X better for Optimized ROE than for Audience Targeting
    Conclusions:
    Optimized Run-of-Exchange campaigns have a much lower cost of media
    • Audience Targeting leads to multiple buyers bidding for a relatively small number of impressions
    • Retargeting lists are limited in size and unable to scale
  • Learning: Effective Campaigns are built on “Brand Genomes”
    © 2010 DataXu, Inc. Privileged & Confidential
    16
    Challenge:
    Build a campaign that is “brand unique” instead of “industry unique”
    Results:
    The “brand genome” campaign drove conversion rates 2-3X higher than traditional campaign strategies
    • Using a competitor’s genome did little to increase conversions
    Conclusions:
    To drive optimal campaign performance, your media strategy should be as unique as your brand
  • Agenda
    Introductions
    Industry Overview
    DSP Learnings & Key Requirements
    RTB & Premium Inventory
    © 2010 DataXu, Inc. Privileged & Confidential
    Ben Trenda, VP of REVV Marketplace Development
    17
  • What’s the Rubicon Project?
    © 2010 DataXu, Inc. Privileged & Confidential
    the Rubicon Project is leading a revolution of the online advertising ecosystem through the innovation of a next-generation infrastructure and a powerful, open marketplace.
    Leading Yield Optimization Platform
    Fastest growing advertising tech company:
    • Founded by ad server pioneers in 2007
    • 250 employees
    • $60M funding
    • More than 1 trillion ads served
    • Key Acquisitions:
    • Fox Audience Network
    • OthersOnline: audience affinity analytics
    • SiteScout: ad security
    • Most Innovative Company, American Business Awards 2010
    • Trusted by 350 Premium Publishers
    • 33% of comScore 100 (U.S.)
    • 88 of comScore 500 (Global)
    • 12 of Top 15 Newspapers in the U.S.
    • REVV processes more than 60 billion ad transactions per month (1 trillion+ to date)
    Largest* Display Advertising Marketplace
    • *Per Quantcast (#1 Rank)
    • 550M+ global uniques
    • 600+ ad networks, exchanges, DSPs
    • Non-Competitive (no advertiser access)
    • Transparent (not "black box")
  • REVV & Publishers
    © 2010 DataXu, Inc. Privileged & Confidential
    the Rubicon Project has engineered a technology platform and marketplace to enable publishers to more effectively compete in today's highly-competitive market.
    Increased Revenue
    • Manage all sources of demand
    • Yield optimize for highest revenue
    • across all sources of demand, including RTB
    • More effectively compete:
    • massive network effect vs. silo
    Reduced Costs
    • Eliminate unnecessary overhead:
    trafficking, ad quality, management, reporting, billing, collections
    Total Brand Protection
    • Protect your user experience
    • Protect direct sales pricing
    One platform
    to yield optimize all inventory
    one marketplace
    to access all demand
  • RTB & Publishers
    © 2010 DataXu, Inc. Privileged & Confidential
    KEY TRENDS
    • Advertising revenue moving from offline to online
    • 2/3 of online display impressions sold on a non-guaranteed basis
    • RTB is nascent (“industry beta”): limited inventory, today small (but fast-growing!) % of total spend
    Notable drivers on the BUY side:
    • 4 agency holding companies control > 50% of US ad spend
    • Each has created a trading desk to fix the problems inherent in the buying of digital media (duplication, opacity, quality, efficiency)
    • Agencies working to move spend to trading desks
    • Trading desks want to spend via RTB
    • Tradingdesks limiting ad network access to this spend
    • DSPs aggregating agency, advertiser & network demand
  • RTB & Publishers
    © 2010 DataXu, Inc. Privileged & Confidential
    KEY TRENDS
    Notable drivers on the PUBLISHER side:
    • It’s tough being a publisher today…
    • Inventory volume is up, CPMs are down
    • Advertisers want to buy audience, not just inventory
    • 2 million active advertisers (how to reach them all!?)
    • 2/3 inventory sold on a non-guaranteed basis (via ad networks, exchanges, DSPs) – how to optimize all those sales channels?
    • So publishers are watching the media buying landscape carefully:
    • Programmatic buying will be increasingly important
    • Agency-originated non-guaranteed spending starting to become concentrated within trading desks— can’t afford to ignore
    • Advertisers/agencies asking for access to publisher non-guaranteed inventory within programmatic environments
  • RTB & Publishers
    © 2010 DataXu, Inc. Privileged & Confidential
    OPPORTUNITIES & RISKS
    RTB can give publishers…
    • Revenue - new source of demand
    • Quality - high quality brand campaigns not always available through ad networks
    • Efficiency – the right ad to the right user at the right time, at the highest possible price
    • 360° Yield Optimization – RTB within the context of total demand access can drive overall yield
    But it can take away, too…
    • User Experience Issues
    • Direct Sales Revenue/Channel Conflict
    • Data Leakage
  • Questions Publishers Ask
    © 2010 DataXu, Inc. Privileged & Confidential
    INSIGHT & CHALLENGES
    Pricing
    • How do I leverage RTB to protect & build my pricing (not erode it)?
    Control:
    • How can I control global sales rights management on my inventory?
    • Who should have access to my inventory? When? Where?
    • How should I manage my advertiser & agency relationships?
    Flexibility:
    • Is there technology that will enable me to offer priority access to inventory (non-guaranteed) to certain partners on the fly?
    Visibility
    • What inventory should I make available for RTB?(sites, zones, ad sizes, user sessions, etc.)
    • How can I get the same insight into my inventory, audience and revenue that the buy-side has?
    Data and Safety
    • Do you have the right technology and contractual controls to protect my inventory, sales and data assets?
     
     
  • What’s Next: RTB in 2011
    © 2010 DataXu, Inc. Privileged & Confidential
    CONTROL, VISIBILITY AND FLEXIBILITY
    To achieve publisher goals, RTB needs to deliver both significant revenue impact alongside transparent controls that ensure publishers and critically, their advertisers, garner real ROI.
    • Private Marketplaces
    • Preferred Price Floors
    • First Look/Right of Refusal
  • What’s Next: RTB in 2011
    © 2010 DataXu, Inc. Privileged & Confidential
    Protected RTB: IT’S ALL ABOUT CONTROL
    Protected RTB optimizes real-time bids for inventory alongside all sources of demand, ensuring that every impression is sold for the highest possible price, regardless of the buying mode of the sales channel, all with critical protections in place to ensure user experience, direct sales and data are protected.
    These tools can be used ininnumerable ways to buildstronger and more direct,programmatic relationshipswith advertisers.
  • The Results To Date
    © 2010 DataXu, Inc. Privileged & Confidential
    CPM
    20%
    CPM
    INCREASE
    RTB alone drives immediate lift(3–5x CPM) while protecting publisher revenue against channel conflict, pricing arbitrage & data leakage…
    …and additional yield growth of 20% across ALL non-guaranteed inventorywhen Protected RTB is enabled in concert with all optimization sources
    publisher A
    Total revenue lift before RTB
    publisher A
    Total revenue lift after RTB
  • Agenda
    Introductions
    Industry Overview
    DSP Learnings & Key Requirements
    RTB & Premium Inventory
    Branding vs Performance
    Success Stories
    © 2010 DataXu, Inc. Privileged & Confidential
    Steve Weeks, Sr. Manager of WW Advertising
    Michael Jenkins, Sr. Communication Strategist
    27
  • Operating in silos: The Past
    Raise awareness
    Site direct buys focused on high target audience composition
    Premium rates
    Messaging focused on product benefits
    “Learn More”
    © 2010 DataXu, Inc. Privileged & Confidential
    “Brand” Efforts
    “Response” Efforts
    Sell product
    Network buys focused on increasing campaign reach
    Remnant inventory
    Messaging focused on product features
    Drive to “Try/Buy now”
    Few opportunities to apply cross-campaign insights in real-time
  • Cross-campaign interaction: The Present
    © 2010 DataXu, Inc. Privileged & Confidential
    Brand Efforts
    Response Efforts
    Leverage data to deliver relevant, timely messages to in-market consumers
    Excite, engage & entice. Grow marketable universe.
  • Adobe Creative Suite 5 Launch
    © 2010 DataXu, Inc. Privileged & Confidential
    The Goal:
    Raise awareness, pique interest and drive revenue of CS5 – all starting on Day 1 of launch.
    The Strategy:
    • Create a variety of unique media touch points to surround target and drive users to site in our branding efforts
    • Tag Adobe.com to track interest and consideration or consumers.
    • Utilize site/user data to deliver relevant messages at scale in response efforts
  • Brand efforts drive interest and traffic…
    © 2010 DataXu, Inc. Privileged & Confidential
    Brand Campaign
    Excite, Engage & Entice
    The site and it’s content, in addition to banners, are the canvas
    Foster community through social enablement (not just social media)
    Consider all media – not just digital – and it’s ability to drive consumers to the web
    31
  • …and response efforts will capitalize on insights.
    © 2010 DataXu, Inc. Privileged & Confidential
    Matching product to sub-targets
    (i.e. After Effects for video enthusiasts)
    Response Campaign
    Deliver relevant, timely messages
    Purchase process messaging
    (i.e. offers for trialists)
    Broad, efficient media +
    granular targets & messages
    Leverage site data to develop relevancy
    Incentivize when necessary
    32
  • The Results
    © 2010 DataXu, Inc. Privileged & Confidential
    Response Campaigns
    Brand Campaigns
  • Agenda
    Introductions
    Industry Overview
    DSP Learnings & Key Requirements
    RTB & Premium Inventory
    Branding vs Performance
    Success Stories
    Q&A with panelists
    © 2010 DataXu, Inc. Privileged & Confidential
    34
  • IAB Updates: www.iab.net
    • Educational Webinars (Virtual)
    • Mobile Campaign Measurement – Your Questions Answered
    Wednesday, January 12, 2010 Noon EST
    Professional Development Classes (NYC)
    IAB Classes on Professional Presentations, and the Digital Ecosystem starting mid-January… stay tuned!
    IAB Annual Leadership Meeting
    Palm Springs, California
    February 27 – March 1, 2011
  • Credits, Future Webinars
    Earn Credits for attending IAB Webinars
    Individuals earn one (1) hour credit for each webinar attended through the IAB.
    For further information on the IAB Digital Advertising Certificate, please visit: www.iab.net/events_training/certificate
    Member Led Seminar Submissions
    If you are a member of the IAB, we encourage you to submit proposals for future webinars. There is no cost to members for these sessions, and we hope they will provide a valuable forum for members to showcase their latest insights, research, and technologies.
    To submit a webinar proposal, email luke@iab.net, or visit www.iab.net/member_webinar_submission
  • Q&A
    Please type your questions into the Questions tab on the right hand side of your screen