Display Advertising's New Wave

Digital Advertising’s New Wave

Hello, I’m Jonathan Mendez, Founder & CEO of Yieldbot
Twitter: @jonathanmendez Company: Yieldbot (www.yieldbot.com)
Location: New York City Blog: Optimize & Prophesize (search “jonathan mendez”)
2006-2008
2008-2010+

History Lesson # 1
“People don’t read ads. People read what interests them. Sometimes that an ad.”
- Howard Gossage

History Lesson # 2
“I do not regard advertising as entertainment or an art form but as a medium of information”
- David Ogilvy

History Lesson # 3
“What information consumes is rather obvious: it consumes the attention of its recipients. Hence a wealth of information creates a poverty of attention
...and a need to allocate that attention efficiently among the overabundance of information sources that might consume it.”
Herb Simon: Computers, Communications and the Public Interest. 1971!!!

Tim Berners-Lee
“Information Management”
Hypertext
Computer Conferencing
Document Retrieval
Information Management
Project Control

Services are not an ad supported biz model!

“This is the first mass marketing medium that isn’t supported by ads.” – Seth Godin 2008

But old models die hard

2001-2007: Easy Money
Media $$$
Free Search traffic
Big Display Networks
High CPM
Page Views

Google Changed Everything

Google Changed Everything
Search fractures information architecture

16% of Search Terms overlapped with the NY Times Information Architecture

6 months later 60% of top 50 terms the same

The largest value creation in web content
is not publishing
…but the tools for the discovery and distribution of it.

Who was focused on allocating attention efficiently among an overabundance of information?

Discovery & Recovery of Info
Realtime & Historical
Targeting
User control/segmentation
Testing & Optimization
Search adds value to the content!

2008-2009 Efficiency & Performance
“The gap is widening between spending on simple search ads and display ads. Search ad spending is on track to reach $10.4 billion this year, double what will be spent on display ads.”
- eMarketer, 2008

SEARCH = THE GOLDEN TRIANGLE

DISPLAY = THE GOLDEN SHOWER

“For all the new media spin it’s just old media”
- Advertising Age June 2008

A World of Old Metrics

… and Lazy Marketers

We are not advancing in our use of advertising & marketing technology at the same pace our audience becomes more advanced in their use of the web.

Communication technology has always made consumers smarter and amplified their diversity.
Marketing is getting more difficult!

“80% of Americans spend as much time on the web as TV”
“Are Big Ad Agencies so clueless that people should avoid them?”

It’s a User Controlled Medium!

Web 2.0 was the rise of new publishers
Self publishing
Aggregators
UGC
Self-serve classified
Hobbyist
Curators

“Branding is why media buyers don't care about context. But Branding only works when people can't talk to each other, and compare notes on the "images" they are being sold. The web made sure that era is over. Branding, and so "impressions", don't matter any more.
Marketing is about identifying markets and fulfilling needs. Marketing thrives when people can compare notes, and Marketing craves context, because needs in a market are specific.”
-Jim Novo (comment on my blog)

How do you identify markets & fulfill needs?
Make Display more like Search!
THIS IS HAPPENING…

1. INTENT
Display OS V 1.0
Display “Search” OS
AWARENESS
REACH & FREQ.
CPM
PERFORMANCE
DATA
CPx

2. SEGMENTATION
Display OS V 1.0
BULK
SITE / DEMO
PAST BEHAVIOR
DIFFERENTIATED
AUDIENCE
CURRENT BEHAVIOR

3. CREATIVE
Display OS V 1.0
NO VERSIONING
HIGH DEV COST
LEAD TIME
TARGETED
DYNAMIC
SELF SERVE

4. BUYING
Display OS V 1.0
RATE CARD
VERBAL
I/O
BID & RTB
DSP/EXCHANGES
AUTOMATED

5. CAMPAIGN MANAGMENT
Display OS V 1.0
HIGH MINIMUM
SWITCHING $
NO OPTIMIZATION
LOW MINIMUM
NO SWITCH $
OPTIMIZATION

Display’s New Market Wave
Advertiser
Publisher
Publisher
Publisher
Network
Publisher
Advertiser
Exchange
Publisher
Advertiser
Advertiser
Network
DSP
Yield Opti
Publisher
Network
Advertiser

The Wave is Crashing on Pubs
Market Results: More inventory, lower prices
Strategic Result: Cookie users to serve impression in lower cost inventory

Data & Analytics will save publishers

OWN IT!
The value created by your audience & content is
DATA

THANK YOU!

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Display Advertising's New Wave

by Jonathan Mendez

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