- Image by LonelyBob via Flickr
It seems to me that more and more companies are working towards what the cable and phone companies are calling the triple play package. This is where you get phone, Internet, and TV service all from one provider all with one bill, hopefully lowering the overall price and making things less complicated.
I have found recently that this convergence is starting to happen (or at least trying to happen) in the world of online advertising. I think the three plays in this case are Search, Display, and Other (which could be video, audio, etc…)
Right now there are specialized firms that concentrate on each of these areas; Search Marketing firms, banner optimization companies and ad exchanges, and video networks or overlay companies. Each is vying for advertising dollars to provide value in the form of results back to the advertising agency or brand they are working for.
In the case of banners, this process happens in the form of end of campaign (some in campaign) data as Clicks, Impressions, and Actions. This may or may not be able to be integrated back into your Business Intelligence system to track against other advertising efforts.
In the case of Search Marketing, this process happens in the form of daily, weekly, or monthly reports that have Clicks, Impressions, Actions, and perhaps a view other metrics. This usually ties into other search campaigns going on, and hopefully ties into your BI system to track against other advertising effort.
In the case of Other, lets use video, the process happens in the form of reporting surfacing activity, interaction, and clicks – similar to banners. The results here are hopefully exportable, but certainly not integrated with your Business Intelligence reconciliation effort.
Companies are now trying to integrate these advertising efforts together by using one delivery system such as ATLAS or DART, or one business intelligence system to suck in all the metrics in the form of .xls, .csv or other format and tie everything together.
For this data reconciliation to happen correctly you need a keystone or unique identifier within all three data sets. In the case of online advertising this comes in the form of a unique ID associated with each campaign down, and hopefully down to the specific row in the table.
The benefit of having a unique key that travels along with each creative, action, or ad copy is that you can then input the data back into one system to track and take action upon.
By connecting your advertising efforts of Search, Display, and Other together you get a Tripe Play data reconciliation happening which provides true ROI on every $1.00 that goes out the door. Without doing this reconciliation you cannot know your true ROI.
Currently this is not possible with less tracked forms of media such as TV, print, Radio, OOH, and a few others – but that is another conversation.
For the past few years there have been specialties in the forms of hybrid agencies with a ton of technology, and the last mile of service to get the job done. Many are working on solutions they want to put in the hands of the agencies and brands themselves. This is a complicated pivot for the world of advertising, and a complex problem to put in the hands of a media planner or media buyer within an agency.
I look at this as the last mile in fiber optics, something Verizon has recently started to try to solve with bringing FiOS to homes.
Fiber optics has been around for awhile and within the grasp of consumers – but telco’s have never been able to solve this last mile problem. As early as a few years ago telco’s were able to bring fiber to the node (FTTN) but not to the premises (FTTP). Only recently have we seen companies willing to absorb major fees and do 6 hour service calls to accomplish this FTTP last mile problem.
This is the problem occuring with high yield banner networks and high efficiency search marketing companies. Each have specialties and staff trained to use their tools. They are reluctant to take on a new medium let alone report on a new type of ad – yet all need to converge.
The self serve tools coming out of these companies are a good first step. Translating these tools into API’s that can be used across companies with varying specialties is the next step. Disintermediating the agencies themselves with this new breed of agency follows that evolution. Finally, putting these tools, concepts, and specialty at the brand and company level makes the new super agencies obsolete.
I do not have a time frame on any of this, and I am not even sure this prediction will come true. My thesis is based on what happened and what is continuing to happen to large agencies and what has happened in the television upfront buying market over the past decade.
Today, it seems these new systems will not reach the traditional agencies for some time. Only recently has search marketing expertise been brought in house, acquired, or built up by the large players. Some brands have taken on the burden of building themselves as well.
Right now the convergence of reporting systems, ad delivery networks, tracking correctly, and making each dollar spent accountable and as hard working as possible are problems worth solving.
I have had great conversations around this topic recently with folks working on solving them, and I invite anyone working within this area to chime in and tell me their thoughts. This blog is sometimes a free flow of ideas for me to understand a market and this post helps me do exactly that.
![Reblog this post [with Zemanta]](http://img.zemanta.com/reblog_e.png?x-id=38b0976f-a4df-4aec-87f3-6eb470981277)
July 20th, 2009 at 9:26 am
Great post. Makes a ton of sense.
Unlike the telco's, internet companies do not have to deal with bricks and mortar. Within the internet industry, the barriers to entry are much less, and the velocity at which things can change is super fast. With that said, the “last mile” problem, or solution rather, should come because all it takes are a couple of smart engineers with a computer, instead of a couple dozen laborers to rewire buildings.
“Finally, putting these tools, concepts, and specialty at the brand and company level makes the new super agencies obsolete.” – should be interesting to see if the “super agencies” become obsolete.” I would argue that they most certainly will evolve and adopt technologies (either built in house, or acquired) and will use those technologies to complete the last mile. Too bad by the time they do, the industry will have evolved yet again…
July 20th, 2009 at 9:33 am
I mean that term with praise – thats what makes them superstars. They are
able to capitalize on an area undeserved by traditional value chains. They
will probably evolve faster and continue to provide a service with a
margin. Nothing wrong with that.
July 20th, 2009 at 9:35 am
Yup. Totally agree.
July 20th, 2009 at 12:02 pm
Very interesting post. I think you do a good job of framing the challenge — ideally all digital advertising response data should be stored in one data warehouse so marketers can get a holistic view of ROI, instead of optimizing search display and other in silos. Having an integrated agency that manages both search and display, with dedicated specialists for both mediums, is beneficial because having the responsibilities divided among two companies is a hurdle to optimization, in the same way that silo'd data is a hurdle to optimization.
Once a company has integrated response data (clicks and actions) for each creative ID, the next challenge to gather and consolidate cookie-level user data. You might find that search is driving better ROI than display in terms of actions, but what if an individual watches an pre-roll on Hulu, then interacts with a rich media ad on the Yahoo homepage, then finally clicks a sponsored link on Google and buys a phone. Integrated reporting in Atlas would show that search drove the conversion, but in fact the pre-roll video and rich media ad probably had a lot to do with it.
Tracking the ROI of separate channels on a user level is a big challenge, both in terms of collecting the data and understanding it. Microsoft has tried to solve the problem with their Atlas Engagement Mapping product, but I think the solution will come with in the reporting elements of buying platforms like InviteMedia, AdBuyer, and MediaMath. Getting the holistic reporting data is good, but isn't it even better to have the reporting and buying tool integrated, so that optimization can be automated?
I don't believe that agencies will be disintermediated by integrated reporting, but as marketing becomes more data-intensive it will change agency culture. The best thing agencies can do is build strong partnerships with technology providers. They don't need to build the technologies themselves to avoid disintermediation. Agencies exist to provide sound, disinterested advice on media strategy and, now, media technology strategy, and they can continue to deliver value by providing that advice.
July 20th, 2009 at 1:23 pm
Thanks for the great comment.
I agree that Search gets the last click attribution and therefore the
highest ROI – but people have not lost faith in branding, banners, and
pre-rolls as the budgets are still higher in other mediums outside of
search.
I also agree that not all agencies should build the technology, but this
leaves a knowledge gap in their native workforce of understanding the
technologies they are licensing from everyone else. I have seen first hand
what that can lead to.
Perhaps its partnerships with true understanding – but no acquisitions, so
they can always work with the latest and greatest to come along.
July 20th, 2009 at 5:12 pm
Great point: agency technology can only advance as quickly as the people in
the agency. To gain adoption, technology companies not only need great
programmers, they need great educators to demonstrate the value of the
technology and teach planners how to use it.
We agree that an independent company will probably innovate better than an
agency acquisition. I say they might even be able to educate better as well,
since a company whose revenue is tied to successful adoption may develop
better education modules than the agency's internal resources would.
July 20th, 2009 at 6:23 pm
Thanks for the great comment.
I agree that Search gets the last click attribution and therefore the
highest ROI – but people have not lost faith in branding, banners, and
pre-rolls as the budgets are still higher in other mediums outside of
search.
I also agree that not all agencies should build the technology, but this
leaves a knowledge gap in their native workforce of understanding the
technologies they are licensing from everyone else. I have seen first hand
what that can lead to.
Perhaps its partnerships with true understanding – but no acquisitions, so
they can always work with the latest and greatest to come along.
July 20th, 2009 at 10:12 pm
Great point: agency technology can only advance as quickly as the people in
the agency. To gain adoption, technology companies not only need great
programmers, they need great educators to demonstrate the value of the
technology and teach planners how to use it.
We agree that an independent company will probably innovate better than an
agency acquisition. I say they might even be able to educate better as well,
since a company whose revenue is tied to successful adoption may develop
better education modules than the agency's internal resources would.