Right Media Exchange Update From Yahoo! VP McGrory

The following is an excerpted interview with Ramsey McGrory, Yahoo! VP and Head of Right Media Exchange.  McGrory discusses recently announced plans for Yahoo!’s display advertising exchange – Right Media Exchange.  Topics covered include:

The results of the Demand-Side Platform (DSP) Pilot Program…
A new Search Engine Marketing pilot on Right Media Exchange…
Demand Media, a publisher for RTB participants on Right Media Exchange…
On Right Media Open, an event produced this week by Yahoo! for its Right Media partners…

On the results of the Demand-Side Platform (DSP) Pilot Program…

RM: The specifics on DSPs are actually pretty good. We expected to see improvements in targeting. We expected to see, conversely, that would mean higher bidding, which is valuable to the publishers. And so I think we generally got what we bargained for. Which is the targeting efficiency, the control of frequency, the control of cost. The DSPs are, by and large, moving directionally on executing on that vision. That’s a good thing.

Read More: AdExchanger

The Career-Relevant Timeframe

I’m attending the Right Media Open in Chicago and, no surprise, change is in the air. Although there is a general consensus on where the industry is headed, I am seeing a healthy debate around the timeline for that change.  While discussing the importance of indirect, bid-based sales to publishers, Dave Zinnman from Yahoo pumped on the brakes, saying that if you believe exchange-based inventory will become dominant in a “career-relevant timeframe”, you need to “step back from the punch bowl.” For me, “career-relevant timeframe” is the most important phrase I’ve heard today.  No matter what your business, its important to have a realistic understanding of how fast your market is changing. Just today, VMM founder Darren Herman retweeted his 2008 post comparing the rate of innovation with the rate of adoption, and reminding entrepreneurs to build for today’s market. That’s the relevant timeframe for a venture backed startup between rounds.  Here in Chicago, the question of the day is: what is the relevant timeframe for advertising-related companies evaluating the momentous shift toward automation?  Up until now, I think media decisionmakers have been very confident in their ability to influence the rate and direction of change. At the 2009 24/7 Real Media Summit, I was struck by GroupM CEO Irwin Gotlieb’s remark that he felt it was, in some part, his responsibility to manage change in this new media landscape on behalf of various stakeholders. Consolidated media buying firms exist for the sake of exerting this type of influence and the comment made me think a lot about how and when the industry would change.

 Read More: GregHills.com

RockYou Strikes Virtual Currency Deal With Facebook

RockYou has entered into a five-year agreement to make Facebook Credits the exclusive payment option in its social games and applications on the social network. The deal, unveiled Thursday, is a boon for Facebook, as RockYou is one of the largest developers on the site, with about 34.6 million monthly active users and 2.7 million daily active users, according to Inside Network’s AppData.  The move helps ensure that Facebook’s virtual currency will gain wider distribution across the site. Until recently, Facebook Credits, which cost 10 cents each and allow users to buy virtual goods in games and apps, had only been available in a limited number of apps for testing.  But Facebook has lately been trying to build the user base for Credits through deals with significant developers, who get a 70% cut of revenue from sales suing the virtual currency. Some developers, principally game maker Zynga, have resisted offering Credits because of the 30% cut Facebook takes.  In a five-year deal announced in May, however, Zynga broadly pledged to expand the use of Credits in its games, which include wildly popular titles like “FarmVille” and “Mafia Wars.” Separately, smaller developers including CrowdStar and Lolapps have also signed exclusive five-year deals to use Facebook Credits exclusively.

Read More: MediaPost

iPad As A Business Tool? Probably Not Yet

AT&T’s activation of 3.2 million iPhones in the second quarter got the attention of the tech media Thursday, highlighting the Apple device’s continued importance to the company’s wireless business.  But during its earnings conference call, AT&T also shed some light on that hot-selling Apple product, the iPad. The carrier said it activated 400,000 to 500,000 iPad 3Gs in the quarter, with usage about as expected — higher than a typical iPhone user, but less than someone using a laptop. Apple said last week that 3 million of the Apple tablets had been sold since its April 3 launch.  Tim Cook, Apple’s chief operating officer, said during the company’s conference call this week that it is selling iPads and iPhone 4s as fast as it can make them. And apparently the iPad doesn’t appeal only to consumers. AT&T’s Chief Financial Officer Rick Lindner said Thursday the company has been surprised by the level of interest among business users.  When the iPhone was first launched, he noted that businesses, and especially chief information officers, were reluctant to adopt the phone as a business tool. “Over time that’s changed dramatically,” he said. But “right from the beginning with the iPad, we’ve had a number of business customers express interest.” Lindner also suggested some companies might even use iPads to replace laptops.

Read More: MediaPost

Real-Time Bidding and the RTB Ecosystem

Real-time bidding (RTB) is the fastest-growing form of display advertising delivery and will significantly impact publisher CPMs and the amount of ad inventory we see from advertisers. The technology has been described as revolutionary and, in a nutshell, it gives advertisers the ability to target messages to the right user, in the right place, at the right time. The goal of RTB is to achieve the highest possible value of a single ad impression by dynamically delivering reach to targeted users on an impression-by-impression basis.  This is a competitive bidding environment in which advertisers attempt to reach individuals based on specific demographics and psychographics, assigning a value to each impression used to reach specific users in real time. This is a brave new world for the publisher, where networks and exchanges will look to take ownership of our users and our data, segmenting our audience in an attempt to deliver the most highly targeted eyeballs for advertisers. We need to take ownership of our users and our data, earning premium CPMs through targeted ad delivery and the use of RTB technology.   To that end, let’s take a closer look at real-time bidding and the ecosystem in which it operates. There are burgeoning industries and players within them that you may have never heard of, so we’ll take a deep dive on this subject and spend time looking at RTB enablers, agency buying desks, DSPs and sell-side platforms, ad networks and exchanges and the data providers that make this all possible.  Sell-side platforms have become real-time bidding technology providers. You can see this in the offerings of two of the major online advertising yield optimizers, Pubmatic and AdMeld. Working with them comes in a couple of flavors. One, layer their product onto your existing ad serving platform and have them deliver RTB ads—over your site or network of sites—that they have sourced; or two, and better yet, take the product to advertisers yourself, using the sell side platform’s technology to target demographically using dynamic bidding. 

Read More: minonline.com

Ad Networks & Demand-Side Platforms

The interactive ad industry is widespread with buzzwords, catchphrases and acronyms. Which new, abbreviated, “next gen” solution will unleash its “game changing” power on the digital marketing landscape? Will Demand Side Platforms (DSP) rule this brave new world? At Epic Media Group, we don’t believe so. With information moving so quickly, it is no surprise that there are so many opinions and a great deal of confusion. Hot topics like data, transparency, real-time bidding (RTB), trading desks, and search re-targeting further complicate the industry landscape for most industry onlookers rather than simplify it – fueling circular conversations that last for months.  Demand Side Platforms are making noise, sure, but just like a trendy new band, the sound may be different to your ear. Simply put, a new genre does not make all previous genres irrelevant. In fact, if you deconstruct the name Demand Side Platform it becomes far less complex than it seems. As our CMO, Mike Sprouse, recently pointed out on this blog, advertisers want online advertising to be simpler and we think that will begin happening in the near future. Simplification begins with our industry’s acronyms.  The term “platform” – a word we use a lot at Epic Media Group – means a plan of action, scheme or design. Platform is also defined as a raised, level surface – like a train platform or a stage. Technically speaking, it is a hardware architecture and framework that allows software to run.  Strong platforms should be designed to support all of a company’s business channels, allow for cross-channel functionality, and leverage massive amounts of data and data analytics to deliver advertiser campaigns across all channels. The “P” in DSP references the capability to place bids, in real time, for impressions available on inventory exchanges with a user interface that provides some degree of reporting. A strong technology platform must encompass a lot of things and is an integral part of any ad intermediary’s business.

Read More: EpicMediaGroup.com

Dead Metrics Walking

I was recently asked about the relative ROI of different advertising channels – from TV, print, and radio, to direct mail, e-mail, and banners, to search ads, social media marketing, and location-based and mobile marketing. In comparing these diverse channels, it became clear that they really couldn’t be compared easily because the types of metrics were all different and measuring different things.  Let’s take a closer look at these metrics, grouped into three buckets: 1) push advertising – approximations of reach and frequency, 2) direct response, and 3) pull marketing – user-initiated ads.

Read More: ClickZ

Matt Freeman: Marketers Need More Specialization, Fewer Agency Relationships

When Matt Freeman jumped from startup shop Betwave to Interpublic Group of Cos.’ Mediabrands back in January to head up its newly launched division called Ventures, which was responsible for overseeing 16 separate agencies, he landed right in the middle of the action.  The day after he joined the company it was announced that Nick Brien, former CEO of Mediabrands at the time, and the man who hired Mr. Freeman, was stepping down to run Interpublic’s McCann Worldgroup. Mr. Freeman, along with Matt Seiler, global CEO of Universal McCann; Richard Beaven, global CEO of Initiative; and Tara Comonte, chief operating officer and chief financial officer of Mediabrands, were then named to the office of the chairman, the new management structure that would run Mediabrands. But such situations aren’t really anything new for Mr. Freeman or all that daunting.  In fact, it’s probably nothing compared to the time his family moved to Italy and his mother informed him that he and his brother would be starting classes at an Italian public school that year. “We don’t speak Italian,” he remembers telling his mother. “Good luck,” she told him.

Read More: AdAge

Automating Success With Creative Optimization

Many sci-fi films portray a world where computers take control over mankind. It’s a scary concept and yet, in the near future, we may find even within our own industry, a world where computers make creative decisions for us.  But there’s no need to fear or panic. Unlike “Terminator” or “2001: A Space Odyssey,” these computers won’t turn against us. Instead, they will help us to facilitate smarter and more effective advertising.  The future is closer than you think and soon enough, creative optimization algorithms will change the way that advertisers interact with their target audience. It will enable advertisers to customize creatives and engage users on a personal level.  So what exactly is creative optimization? It’s a learning algorithm that receives constant feedback based on the user’s interaction with the ad. The algorithm changes the creative depending on the users’ feedback and can display the versions of creatives that are more likely to receive clicks, conversions, interactions or dwell.  By constantly comparing the results from each version of the ad, creative optimization automatically serves the most effective ads. Creatives can also be optimized to maximize performance for each target segment, taking the work out for advertisers who don’t have to waste time playing the guessing game. Advertisers can upload all of their creative ideas and let the algorithm serve the versions that users will respond to the most.

Read More: Adotas

The End Of Location Based Applications?