…they could all force publishers to change the way they sell and operate in the near future.
Have you ever had one of those digital media moments where you thought, “cmon, really?!” Well, on Monday morning I attended Digiday at the W Hotel in NYC and for a moment, thought exactly that… for a minute. I think it was brought up numerous times that it’s no longer appropriate to call your inventory sold and unsold, but more like ‘reserved and non-reserved’ as Darren Herman put it. I thought to myself, hmmm, ok, let’s go with that…it sounds better than remnant for sure…but then later that day, it was then proclaimed ‘premium and sub-premium’…I guess because ‘non-premium’ sounds too much like a fake Louis Vuitton handbag sold on 5th Avenue next to the hot dog vendor – you might buy one, but you’ll feel a little icky after.
Believe it or not, all this renaming and debating over what to call unused inventory went on all morning. All of a sudden, these silly proclamations started to make me think. If people are spending all this effort debating over what a specific category is called, there must be a disturbance in the force; the growth of this ‘sub-premium’ inventory is growing exponentially. Jason Kelly from Time, Inc agrees that with “…the growth of Twitter and other social media, non-premium inventory is growing at a rapid pace, which also means finding premium inventory is getting harder.” He also added that “non premium display has great opportunity for growth.”
So as sub-premium inventory grows at such a rapid pace, the dynamic of how advertisers interact with consumers is changes along with it.
French children are told a story in which they imagine having a pond with water lily leaves floating on the surface. The lily population doubles in size every day and, if left unchecked, will smother the pond in 30 days, killing all the other living things in the water. Could the growth of sub-premium inventory threaten publishers ability to compete in the future? The answer is yes - if you don’t take action. Here are some thoughts on how agencies are looking to innovate and some action items publishers can take to keep competitive in this newly evolving landscape.
1. Agencies are Buying Audience: You may say, “duh” to that, but with all the impressions available on the Internet, coupled with new technologies, there are more and more ways for agencies to buy audiences. Darren Herman, who runs digital media at the Media Kitchen and is also President of Varick Media Management, talked about their own data initiatives and is working with 27 different data providers to mine data for audience segments.
2. I also traded some emails with Steve Katelman from OMD and when I asked him what the next big initiatives were for agencies, he said “It’s all about audiences and the evolution of real time bidding.” These activities signal that agencies are pushing the envelope and taking media buying to the next level since brands are getting smarter about which agencies they work with.
3. To make things even more interesting, GroupM decided to go against the IAB initiatives for Ts and Cs by claiming ownership of data it collects. According to GroupM’s COO, John Montgomery, this is a way to “…protect the confidentiality of our clients’ campaign data and information.” One does wonder if this becomes a trend, how it could create a dynamic of publishers competing against their own customers OR new price pressures down the road.
So now what?
As a publisher, you need to start to understand your audience. Quantcast is great way to take a first step at understanding the segments you can offer – but that won’t be enough. Taking action on that data and integrating it into your product catalog so it’s easily findable by your ad sales team, will ensure you are ready to sell the way agencies want to buy. Now, that’scompetitive advantage. This was echoed at Digiday by Janet Balis, President of Digital Media Strategies, who spoke on the importance of, at the very least, keeping an up to date “product catalog and sound inventory management strategy” as the industry looks towards more advanced ways to reach consumers.
Industry vet and pal of mine, Nick Johnson from NBCU mentioned that “mining data and looking for specific audience segments is a big focus for us…we are in the business of unlocking data to create value for our clients and their clients.” In order to do this, Nick added, “You need to operate more efficiently and look for places in your business that don’t scale and fix them.” If you want to elevate your game, you need to fix the basic data fragmentation issues in order to solve for the future.
Even if you can get your house in order for this audience revolution, there is still a miss-match in terms of how you set up your resources. Currently, “50% of ad ops time is focused on 15% of the revenue,” says Josh Wetzelfrom Pubmatic. Basically, this means that in addition to getting your data in order, you may have to find ways to free up your ad ops resources to stay focused on big ticket integrations and less on the more repeatable, low CPM, ‘sub-premium’ tasks.
I look forward to your comments.
Lorne
I just returned from London and a great dinner with 15-16 of the most interesting digital media players in the UK. Every couple of months Operative will pull together the heads of sales and ad operations from publishers in London or New York, give them our perspective of how things are looking from an ad operations POV, and then sit back and listen. The June 17 dinner was fantastic – we had some of Operative’s most sophisticated Dashboard users (MTVi, Dow Jones and FIMi) as well as some of the most exciting digital publishers in the UK (Virgin, BSkyB, Bauer and News International to name just a few).
