Data-Labor-Technology

The broadcast rankings in the 18-49 demo this season are identical to one year ago: NBC is in the lead, followed by Fox, CBS, ABC and The CW. However, all of the networks are down year-over-year in the demo (except for The CW, which is flat). The drop in linear ratings continues as a handful…

Amazon is pushing to turn its nascent medical-supplies business into a major supplier to U.S. hospitals and outpatient clinics that could compete with incumbent distributors of items from gauze to hip implants.

Some 90% of the company’s ad revenue now comes from programmatic/self-serve platforms. In the fourth-quarter 2016, 10% of its ad revenue came from programmatic platforms.

Alphabet Inc.’s Google unveiled new technology that lets publishers create visual-oriented stories in a mobile-friendly format similar to the style popularized by Snapchat and Instagram

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“Data-Driven Thinking” is written by members of the media community and contains fresh ideas on the digital revolution in media. Today’s column is written by Martin Kihn, research vice president at Gartner. A new technology appears, seemingly from the ether, and promises to change our lives. Customer data integration, labeling and storage problems will disappear.… Continue reading »

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Here’s today’s AdExchanger.com news round-up… Want it by email? Sign up here. Snaplash Snap sales VP Jeff Lucas, formerly Viacom’s ad sales chief, has left the building, Cheddar reports. Snap had a nice stock bounce, too, after it beat Q4 revenue projections, but the company’s next phase of potential growth will largely be in new hands.… Continue reading »

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By Rajeev Goel, co-founder and CEO, PubMatic

Ad tech vendors are vying to be crowned as the leader in transparency by any means necessary, regardless of the consequences for their clients or the industry. In truth, the transparency debate itself has become radicalized, with attention-grabbing headlines occasionally eclipsing appropriate change. It’s time to move past rhetoric. What the market needs is trust between publishers, advertisers, and technology providers–trust that can be achieved by reimagining programmatic business models.

At the IAB Annual Leadership Meeting last year, Marc Pritchard, P&G’s chief brand officer, called for cleaning up the supply chain, vowing to only pay digital media and ad tech suppliers that complied with the company’s strict quality and transparency requirements. It was the first time a brand advertiser committed to leveraging significant ad spend to improve the programmatic landscape, setting off a wave of efforts and initiatives aimed at achieving this goal. While a year has passed without full resolution, many technology providers have revised business practices to align with changing market demands. Some have even co-opted the concept of “radical transparency” to promote mass disclosure of customer fee rates.

This approach sounds good in theory, but will do little to increase trust between all parties. Comparing fee rates doesn’t work in a B2B environment. The business arrangements are too complex, and companies’ product capabilities are too varied. Ad tech is not a commoditized market. A variety of parameters–feature set, payment terms, quality controls, and volume discounts, to name a few–could be factored into each agreement. Simply put, if your offering is not differentiated, rate wars won’t solve your problem.

More importantly, mass disclosures could result in each side of the digital ecosystem having unwarranted influence over the other. Advertisers, justifiably, want to maximize how much of their ad spend flows to the publisher. But this disclosure could put advertisers in a position to dictate which SSP a publisher should select based solely on fee rate. Likewise, a publisher could tell an advertiser they prefer a specific DSP that charges lower fees. This is a slippery slope. Should advertisers only buy ads from publishers that pay their journalists the lowest wages? Or that pay the lowest rent for office space?

Mass fee disclosure could unfortunately result in a single, isolated commercial term becoming the dominant driver of technology decisions. Premium publishers have told us they could risk significant monetization if buyers seek to route ad spend to competitors with lower revenue shares. And it’s not just publishers that would suffer; this practice could ultimately remove choice and stifle innovation across the industry.

Realistically, programmatic take rates–the share of ad spend that goes to a technology provider–should decrease over time, particularly as volume scales and brand spend overtakes direct response in the programmatic market. Ultimately, publishers should have control over what is best for their business; we need to welcome a vibrant and competitive ecosystem that encourages negotiation on both price and functionality.

The status quo, revenue share-based approach has created an opaque ecosystem. As a publisher-first company, we believe SSPs should remove all fees from the buy-side so the total rate is fully transparent to publishers. But this is only one piece of the puzzle.

A viable path forward requires a mentality shift for decision makers. The way to achieve trust is to move the industry towards a mature software procurement approach that is transparent, lowers costs for everyone, and creates healthy relationships. We have introduced new pricing models that are based on usage, not revenue. By licensing technology to support more sophisticated transaction methods– including private marketplaces and header bidding – publishers will have more predictability and liquidity to take advantage of the evolving market and innovate for consumers and advertisers alike.

As technology providers, we need to stop talking exclusively about revenue targets and instead broaden our conversation to a client’s entire P&L. By thinking about both revenue and cost, one can make more informed decisions that will drive long-term business success. This requires a move towards partnerships between principal (publisher or advertiser) and technology provider, as opposed to campaign- or day-trading-based relationships.

Trust between publishers, advertisers, and technology vendors can be achieved. The real path forward is the application of clear, mature licensing models, not radicalized headlines masquerading as transparency.

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Unilever CMO Keith Weed grabbed headlines Monday when he said the packaged goods giant wouldn’t advertise on tech platforms that create societal division or don’t protect children. The comments were from a keynote at the IAB Annual Leadership Meeting in Palm Desert, California, where Weed said social media needs to earn back the public’s trust, which he said is at a new low, caused by the tech companies’ failure to deal with the spread of illegal, unethical and extremist material shared on their platforms.

“Is it going to be the year of the techlash or a year that we start rebuilding trust?” he asked. “We need to redefine what’s responsible business in the technical age.”

But unlike Marc Pritchard, Procter & Gamble’s chief brand officer, who used the perch to bash the platforms at ALM last year, Weed described a lower-key approach of working with the platforms behind the scenes, which he explained in a conversation. Below are excerpts, lightly edited and condensed.

You’ve said Unilever would not pull advertising from platforms but instead work with them. What’s the case for this approach?
This has moved from being from an industry issue to a societal issue. We need to engage in a much more positive way and encourage them to move faster. Many cut advertising on YouTube last year. We didn’t have a problem with our advertising on YouTube. We were using the highest guardrails and were buying high-quality inventory.

Do you think your approach worked with YouTube, then?
I think they were committed to making big changes. It’s good to have multiple voices. And it’s true with other platforms: Be as tough as you can behind closed doors. It’s been helpful with Facebook, with all the platforms. I’m not suggesting for a second we don’t put the issue on the table — but be challenging in a collaborative way as opposed to giving public ultimatums.

We already direct investment against the 3 V’s: viewability, third-party verification, value. All I’m doing here is adding another criteria, make sure the platforms contribute to a positive contribution to society. I don’t put road maps out in public, but third-party verification and what needs to be achieved by what stage — these are the standards I’ve been working on for some time.

There are those who might say platforms won’t clean up their act until powerful companies like yours suspend advertising on them. What do you say?
In the YouTube example, people did suspend advertising. But engaging and being part of the dialogue, with always the ultimate approach being, if it’s not sorted out, you vote with your dollars, has proven to be more successful.

Unilever has reduced underperforming ads and taken more of its marketing in-house, halving the number of agencies it uses and making 30 percent fewer ads. Is that work done?
We continue to invest in advertising, but we were were producing too much content. We weren’t wearing our ads in sufficiently. I still think there’s more we can do. Where I think we’ll go further is, I’ll further be trimming agencies, not by a particular percentage, but to simplify our portfolio.

Are you prepared to pay more for media if that’ll ensure safer environments?
We’ve always paid very competitive rates, and we’ll continue to do so. I do believe we need to move to a single measurement system, and this will help in cleaning up the challenge of the supply chain. It’ll have a much better impact on user experience, and it’ll help us optimize. You can only spend your dollar once, and you need to spend it wisely, and I don’t intend on spending any more than I need to in digital media.

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