Operative Blog

Guardian News & Media Tackles Convergence with Operative.One

Andy Beale, Director of Technology for Guardian News & Media, discusses the company’s digital-first strategy, why they selected Operative.One to support that strategy and bring together both their print and digital media businesses, and what they hope to gain from using the platform in terms of product innovation and operational efficiencies.   Guardian is the FIRST publisher to bring together both their offline and online businesses onto one single platform, and one of the first to launch an aggressive digital-first strategy.

AdExchanger: Operative CEO Leo Discusses New Operative.One Platform And Automation In Ad Ops

AdExchanger.com: Seven years as CEO and President for one company is not the norm for digital.  Why does it make sense for you?

ML: I love my job. I work with talented people, great clients, and we’re solving a huge problem that publishers, networks and agencies need solved. Our future is bright.  Why would I do anything else?

What problem is Operative solving today?

There are two certainties in our space:

1. The industry cannot thrive until it becomes easier to do business with.
2. Continual innovation is a requirement for survival.

By giving media companies and their partners freedom from the complexities of the digital value chain, Operative enables both.  Since the ERP evolution of the 1980s and early 90s, you will not find a leader in any other industry that has not brought together all of their value chain processes and systems. This revolution, which is a ticket to the game for everyone else, is only just getting started in digital media.

Without a platform upon which publishers can innovate, digital innovation creates chaos. We provide a business management system that supports the adoption of new innovation (new products that can be offered to advertisers) in the context of the publisher’s current way of doing business, yet integrated all on one platform.

Can you drill down from the big picture and discuss the three biggest pain points that you’re solving for clients today?

Sure. We are focused on addressing the following problem areas:

1. Demand-side planning:  With so many different technologies and channels available to monetize inventory, it can be difficult for publishers to understand what and how much is available to sell, and determine the best way to package and price. There is pain associated with managing and optimizing price, as well as pushing inventory to these channels.  Operative.One solves for this.
2. Supply chain management:  The amount of innovation that comes out of this industry is staggering. Ad production technologists like DoubleClick, Rubicon, and BlueKai are a constant source of innovations, increasing the value we bring to advertisers. But if those innovations are not integrated into the business, then chaos ensues.  Production systems are not business systems, and media companies simply cannot grow if they manage production systems independent of one another.  Operative.One enables effective cross-platform execution providing a single view across all production systems.
3. End-to-end ad execution:  For many publishers, product packaging, sales, operations and finance processes are connected manually, and internal systems that handle inventory, CRM and financials don’t talk to each other.  This limits sales productivity, reduces time to meeting impression goals, and causes billing discrepancies. We connect all business processes and systems so publishers can effectively package, sell, traffic, manage, optimize and collect revenue on ads.

Operative.One represents one place to manage demand, one place to manage supply, and one place to execute digital ads.

How has Operative pivoted its business to meet client needs over the past 10 years?

Operative has always been focused on getting the job done for its clients. Ten years ago, we began as an ad operations services company, and over the last six years, we have done significant work to automate those jobs. While the jobs remain the same (whether performed by a client’s staff or ours), our platform creates efficiencies and lowers transaction cost – ultimately getting the job done faster and cheaper.

What is advertising business management?  How do you see this evolving in the next 1-3 years?

Business management platforms are well established in industries outside of digital media. Leaders in business management solutions include SAP, Oracle, Netsuite, Salesforce… and even Wide Orbit, which serves stations and networks. For the advertising industry, business management solutions free media companies from the complexities of the value chain by integrating all of the processes and systems necessary to package, sell, traffic, manage, optimize and bill ads.

In the next 1-3 years, the industry will focus more on the business of advertising, not the system or the pain associated with industry innovation and so many disparate technologies.  Does anyone really need to know how the sausage is made? Does anyone question how a TV ad makes it on the air?  Has a Jaguar salesman ever concerned himself with how (or if) the ABB 6-axis robot is installing the sunroof before it leaves the assembly line?  Don’t publishers succeed when sales people stop talking about ad tags and start talking about how their products maximize brand value?

If you were running a media agency today, what key strategies would you put in place to survive and prosper in the future?

I would ensure that my teams were focused on marketing problems, not technology problems. It’s important for agencies to get control over variable costs and understand how to leverage technology without being in the weeds with it. The number of transactions required to execute a digital campaign are an order of magnitude more than most any other media. If you do not have control over the transactions, it’s difficult to grow a profitable business.  Agencies need to be partnering with providers who have built a business on helping agencies manage transactions, and can take infrastructure off their plates so they can grow profitably, and focus on what’s most important: client relationships and great creative.

What are the funding needs for the company? Profitability? Any plans to go public?

We are profitable and we plan to go public.

Is the DSP model impacting your business? How?

Yes, Operative.One plays an important role with any innovation that our clients choose to adopt.

Ad networks, DSPs, direct to advertisers (and more to come) – these are all viable channels for monetizing advertising assets. The key is having tight controls and a unified view of distribution channels, whatever they may be.  Having one business system ensures media companies can make the right decisions to effectively price and allocate inventory across channels.

What are you seeing from clients today in terms of current momentum?

Publishers are increasingly more focused on direct sales. The deal size is going up and CPMs are going up. And our clients don’t want to give inventory to those who commoditize it.

For publishers looking to get their arms around their data, what do you advise?  And what do you tell them regarding ad network/exchange relationships?

The secret to data is having it all together. Getting it is easy. Analyzing it is hard. The only way to properly analyze data to have it all in one place.

Follow Mike Leo (@rmikel), Operative (@OperativeInc) and AdExchanger.com (@adexchanger) on Twitter.com.

Operative Launches First Advertising Business Management Solution for Media Industry Leaders of Today and Tomorrow

Operative.One joins demand and supply sides of the advertising ecosystem

New York, NY- October 5, 2010 - Operative, the advertising business management company, today announced the general availability of Operative.One.  The first advertising business management solution to join the demand and supply sides of the advertising ecosystem, Operative.One provides freedom from the complexities of the digital value chain by integrating all processes and systems necessary to package, sell, traffic, manage, optimize and bill ads. With Operative.One, media companies and their partners enjoy end-to-end business transparency, resulting in a boost in operational efficiencies and reduction in transaction costs.

End-to-End Solution

Operative.One is an entirely new platform and major upgrade over the company’s flagship product, Operative Dashboard. It serves publishers, networks and agencies with unique functionality to address specific business needs for every aspect of the digital media lifecycle:

• Reduced RFP response time
• Increased yield by maximizing sell-through and minimizing under-delivery
• Delivery of error-free campaigns on time
• Reduced time to close billing cycle from weeks to days
• Collecting 100% of contracted revenue by eliminating discrepancies

A powerful ad master model provides a flexible foundation that ensures an ad unit touches all relevant demand and supply processes.  Integration is supported not only with internal business systems, such as CRM, financial systems and ad servers, but also dynamic external platforms – including networks, data providers and exchanges – relied upon for an accurate account of sellable inventory. 

This release of Operative.One has a particular focus on maximizing yield with robust features for greater flexibility and control over the dynamic nature of digital product and inventory management. Uniquely, Operative.One supports selling audiences and complex targeting-based products, including the management of inventory associated with multi-dimensional products. Inventory management capabilities provide sellers with a deep and comprehensive view of capacity, availability and contenders for multi-target products at the point of sale. The solution also addresses the overlapping nature of multi-target inventory, automatically distributing campaigns across the most appropriate targets.

Cars.com, the leading destination for online car shoppers, will be upgrading from Operative Dashboard to Operative.One. “Maximizing yield is critical to our advertising business operations at Cars.com. After using Operative Dashboard for the past three years to streamline processes and increase visibility, we are excited about the added flexibility, efficiency and transparency that Operative.One promises,” said Michael Kraut, Vice President of National Sales, Cars.com. “We expect that robust new functionality and continued superior service will significantly impact our ability to most effectively build, sell and manage inventory, as well as execute on our key performance indicators.”

Open, Future-Proof Platform

A recent survey by DM2PRO.com revealed that greater than half of all campaigns for the top 10 percent of publishers are cross-platform (include mobile, video, display components in a single order), and 60 percent of publishers plan to sell cross-platform campaigns in the next 6-12 months. As advertiser demand for brand-driven solutions grows, the convergence of mobile, video, print and broadcast advertising will introduce new complexities to the advertising ecosystem.  As an open platform supporting a diverse set of established and emerging partners, Operative.One offers interfaces for extensibility that ease the creation of custom applications and integration of data.  The platform is architected to flexibly support cross-platform advertising and all display, mobile and video needs today, as well as accommodate future demands for cross-media packaging. 

“When we created Operative Dashboard five years ago to unify data, orders and workflow in one system, it was a time when the digital advertising ecosystem was far less complex,” said Mike Leo, President and CEO, Operative.  “Since then, technology innovation and business processes involving multiple parties have created an increasingly fragmented value chain, and this will only continue. Operative.One brings it all together for greater transparency and efficiency so that today’s and tomorrow’s media leaders can focus less on business infrastructure and more on innovating their products and building client relationships.”

About Operative
Established in 2000, Operative (www.operative.com) is the advertising business management company that gives media industry leaders and their partners the freedom to move fast and forward with solutions that eliminate complexities within the advertising ecosystem.  Through the alignment of people, process and technology, Operative.One brings together the business processes and systems necessary to package, sell, traffic, manage, optimize and collect revenue on advertising products. More than 175 industry leaders rely on Operative, including The Wall Street Journal, MSN, Smart Money, NBC Universal and National Public Media. Operative is headquartered in New York City.

FFL and Digital Media

Anyone know what time of year it is?  That’s right, it’s fantasy football draft season.  If you’ve played before, you know that draft season is the most stressful time of year.  This is when you have to sit down, look at all the players that are available and decide which ones will help you win a fantasy football championship.  There are many strategies that you can deploy, and the most conventional is to draft running backs- fast, furious and early on.  Why?  They are the steady players that give you consistent point production.  But, fantasy football has changed.  Some NFL teams now use multiple running backs (AKA running back by committee).  Other teams have moved away from running the ball all together and have opted for the exciting air attack.  This opened up opportunities for fantasy owners to structure their teams around additional point contributors like a Quarter Back like Drew Brees or a Wide Receiver like Larry Fitzgerald.  Decisions, decisions. 

How does fantasy football relate back to digital media? 

Well, it’s also technology budgeting season.  Today’s publishers and specialty ad networks feel the stress of making technology decisions for 2011.  They have to sit down, review all the projects they are going to push for and make a stake in the ground that “these are the initiatives that will put us in the best position to win”.  

Many of these projects will fall into 2 categories.  The first category is revenue.  Plain and simple, if that project is successful, it will directly help you make money.  There should be no ambiguity.  Some example projects include:

• Developing custom creative programs to help you attract new brands
• Building a mobile, video or  social media ad server that promotes engagement metrics or gives you a competitive advantage in the market place
• Introducing rich media tools

The second category is around helping companies drive efficiency inside and outside their organization.  Below are some examples of efficiency-focused initiatives:

• Syncing your publisher/partner/network management systems
• Evaluating and deploying reconciliation, reporting and billing tools
• Integrating with proposal , IO and media planning applications

In order to be successful in 2011, media companies need to do both.  You MUST do both.  If you don’t innovate, you won’t attract the big ad dollars.  If you only innovate and forget about the back-end efficiency, you’ll lose all the customers you won or have a ceiling on the amount of customers you can take-on due to inefficiency.  Quite the predicament. 

For most media companies, there are the few factors contributing to this problem:

1. You’ve got 1 engineering team and they are drinking through a fire hose.  I don’t care who you are…if you’re a digital media owner in some capacity, your engineering team has too much on their plate and not enough time.  Furthermore, with all the new technology in the market place, it’s just getting worse and worse.
2. Most publishers, even today, still run their business on excel.  There’s not one platform in place that you can use as a springboard for innovation.  Not one place to connect all these new things that you’re buying or creating.  This is also the reason your operations teams are so busy.  They have to log into 10 different systems to get their jobs done. No wonder there is so much demand for projects that create efficiency.
3. A large percentage of the technology and business leadership within media organizations still promotes a “let’s build it all” type of mentality.  For example, the industry hasn’t matured enough where the role of the CIO is relevant – there’s no one to advise the CEO on best practices on how to get information, drive revenue and scale (all at the same time).

If this sounds familiar and your ability to be successful depends on your engineering team executing, consider some of these ideas:

1. Make a list of all the projects you have on your plate for 2011.  From there, put a “$” next to each one that your sure will help you drive revenue next year.  Then, put an “E” next to the ones that will help your bottom line (efficiency gains, speed to market, etc.).  Getting clarity on what these projects actually “mean” for the business is the first step.  
2. From there, make the decision to partner with a company that can offer an enterprise platform to help you run your day to day business and gain those efficiencies (inventory management, proposals, packaging, trafficking, reporting, financial reconciliation, etc.).  Make sure your partner has an API and SDK to help you innovate.  You’ll find there are companies that can not only help you get deal with a lot of your “E”s, but also enable you to innovate the “$”s.
3. It’s important to ensure that the company’s technology culture has a strategic focus on revenue and strategic value creation.  I ran into one publisher recently who calls his engineering team “Team Money”.  That’s because their engineering leadership has a mentality of selecting projects that will help the company drive new revenue by establishing partnerships with companies that help them achieve greater efficiency.   This is a cultural change and isn’t always easy.  Engage your CEO in this concept – make it a big deal towards hitting the 2011 revenue number.

By focusing your engineering teams on things that are exciting (like drafting quarterbacks and wide receivers) and partnering with a company that can help you innovate and scale (your work horse running back), you’ll be in a better position to be successful in 2011…successful in beating your competition, meeting the new demands of brand advertisers, raising employee satisfaction in your engineering department and keeping both the top and bottom line on the up and up.

Operative.One Campaign360

Are discrepancies STILL keeping you up at night? 

Has your CFO  charged you with the responsibility of driving revenue opportunity within your Ad Ops department in 2010?

Now is the time to alleviate pain.  Create operational efficiencies within your digital organization by implementing tools that will automate the collection, reconciliation and reporting of primary and 3rd party ad server data. 

Visit our booth and ask the team about the benefits of Operative.One Campaign 360.

IAB Ad Ops Summit - Operative Booth

We are announcing a NEW PRODUCT today at the IAB Ad Operations Summit, so come visit our booth OR CLICK HERE to read about it!

No one sets out with a business model that requires giving money back for delivering valuable products.  Yet, that’s effectively what most publishers are doing with Makegoods and over-delivery. Some have acknowledged the seriousness of the issue and have developed a patchwork of tools in Excel to do a better job of campaign management.  However, these are rarely forward looking or timely to respond in business real-time to a poorly performing campaign.

There are many reasons for campaigns to under perform: the product was oversold, the forecast was wrong, trafficking errors were not caught, and, everyone’s favorite, ad serving delivery discrepancies. How serious is this issue? How about at least $400m annually in the US! That’s assuming just 5% of IAB’s estimate for display ad revenue ($3.8B for 1H09) is disputed.  Our anecdotal discussions with publishers indicate that the number may be even higher.

The good news is that much of the loss can be mitigated by actively managing campaigns, early and frequently.  Automation can easily replace the manual routine that most publishers find themselves in: log into third party ad server, export report, pull it into Excel, reconcile with primary ad server data; repeat for every third party ad server; repeat as many times a month as you can – realistically, just once. Oh by the way, account for changed passwords, misaligned data and just try to get the data right, forget about analysis.

For those of you stuck in this resource-sucking treadmill, we have good news.

Today we are announcing Operative.One Campaign360, a product that makes it easy for publishers to centrally manage and proactively monitor campaigns.  It improves virtually every step of the campaign management process:

• “lights out” integration and collection of data from primary and third-party ad server
• Automatic reconciliation of primary and third party line items
• A simple, grid-based UI for manual reconciliation and overrides
• Robust analysis with pre-built graphs and reports for common tasks such as delivery discrepancy, pacing, top 10/bottom 10 campaigns

All the information that you need to do campaign management and billing is in one place, keeping you from having to do hours of leg work to collect the data, reconcile it, and create reports.

In other words, the product does all the heavy lifting and you focus on making sure that you get all the revenue that your sales team worked hard to book.

Based on our experience of 10 years working with publishers, we are really excited about the potential this product has in improving publisher operations. Learn more about the campaign management and discrepencies in our white paper, Making Peace with Discrepancies: Six Steps You Can Take to Proactively Manage Them, learn more about the product and contact us .