Great Creative from Merrill

I just saw this campm2aign on Y! Finance and it caught my eye, half as a consumer and half as an ad guy.  Clicks through to microsite here.

As I have mentioned before, the creative really matters and this is a great example of what’s possible when creative is designed around an online, 2-way experience.  Fantastic way to ingrain the brand impact and the social sharing feature at the end of the process is a great earned media idea (although I personally am too vain to broadcast my 80-year old face).  Great campaign, and I bet they will see great response.

Banners don’t work?  BS.

Programmatic Branding

Today’s AdExchanger roundup highlighted a great presentation by Bob Arnold of Kellogg Company.   His talk was on brand marketing via programmatic buying.  We obviously hear a lot about programmatic buying (primarily RTB) for DR campaigns, but this is a great reminder that we’ve still just scratched the surface of what programmatic buying can offer.

First of all, there’s much more that can be done with RTB to help brands increase efficiency.  Given the size of Brand budgets, this is a big (huge) area for growth.  Bob shares some great case examples from Kellogg’s experience:

1)    Having the right measurement framework is critical.  Bob’s not talking about CPA and conversion attribution here.  He’s driving long-term changes in purchase behavior through an offline channel.  So he divides metrics into short-term (brand safety, viewability, composition and frequency), mid-term (attitudinal lifts like awareness and purchase intent) and long-term (offline sales lift as measured by Marketing Mix Models).  This is all stuff I’ve discussed before, but we in the tech community can’t hear it too often and it’s particularly great to hear it from a big marketer explicitly in the context of RTB.  Nielsen for one is listening.  They already had a big presence in the first and last buckets, and they recently doubled down on the middle with their Vizu acquisition.   Vizu and Nielsen work great together, so this is a very smart deal.

2)    Creative is fundamental.  In Bob’s words: “Creative quality is paramount…the media plan simply amplifies the creative message.  Studies from comScore and Dynamic Logic [show that] 50-80% of the value of a branding campaign comes from the creative…it’s imperative you get that right.”  Great creative is altogether too rare online, but there are some great examples out there, like this one.  This ad made me stop and think.  And the more I thought, the more it took me away.  I will remember it and it will make me more likely to buy Legos for my kids.  Bob’s comments and creative like this are a reminder that while advertising – the activity – will be an increasingly technical pursuit for the foreseeable future, the best advertising – the thing – will continue to be driven by great creative that leverages this technology to connect people with products in a way that creates a lasting impression.

3)    Doing it right drives great results.  Bob claimed that programmatic buying for Kellogg doubled targeting accuracy while increasing viewability to >70% (higher than direct buys).  It also cut eCPM (CPM adjusted by comp & viewability) by >50% from their starting reference point.  The combination of these factors (assuming creative was comparable before and after) drove improvements in ROI (via MMM) by ~5X.  Just a stunning impact.

These examples demonstrate the power of RTB, in the hands of a savvy marketer, to drive Brand results.  Good news for all of us.

But I also want to point out that there’s more to programmatic buying than RTB.  There’s a whole set of programmatic premium, automated reserve (or whatever else you want to call it) capabilities possible on which the ecosystem as a whole as has barely scratched the surface.  A couple of the pioneers in this area include Brand.net and isocket, but I assure you there will be other, larger players down this path after them.  These next-gen programmatic capabilities are a great complement to the current set of RTB capabilities and they are tailor-made for branding.

It’s exciting to see a large marketer smartly leveraging the available technology in a new way to drive such great results.  It will be even more exciting to see what’s possible as the market begins to deliver more technology focused on this important class of use cases.

Where’s the “LUMA slide” for branding?

Very interesting article today from Brian Morrissey at Digiday, channeling Jeff Levick of AOL.

As Brian put it:

“The truth of the matter is much of the machinery of the programmatic buying landscape, captured in the Luma Partners slide, is dedicated to non-guaranteed inventory used for direct response advertising. Where’s the Luma slide for guaranteed ad space for brands?”

Now, that’s a great question and Jeff has obviously done some great thinking on the matter.

After you give the article a read, check out our results in connecting online ads to offline sales here.

Go Neal!

Some very interesting tidbits in Neal Mohan’s post on the Google blog yesterday.

First is that Google sees display inventory per user declining 25% by 2015.  This is a pretty interesting prediction given the conventional “wisdom” that online ad inventory is unlimited.  This hasn’t ever really been true (provided one cares about quality of placement) and if Neal’s correct, it will become even less true over time as the industry collectively realizes there’s there is too much low quality inventory out there and it’s not doing anyone in the ecosystem – advertisers, publishers or users – any good.

Combine this prediction with the forecast growth in display spend over the next decade and it’s pretty clear we’re heading for a much more constrained inventory landscape.  As these constraints start to bite, it will be interesting to see what happens to today’s auction-driven RTB infrastructure where delivery is not guaranteed.

Expect some serious turmoil as delivery rates drop and volatility increases.  Maybe that’s why Google has begun work on a reserved inventory product

I also want to amplify Neal’s point about 35% of campaigns measured on other metrics than clicks and conversions by 2015, particularly offline sales.  Those campaigns comprise the orange box on this graphic – some $6B in spend last year.  So Neal’s saying the orange share of online spend will grow from just over 20% in 2010 to 35% in 2015.

That prediction certainly syncs with the qualitative discussion in the eMarketer article I cited above, and if you combine the spend estimates there with Neal’s 35% share forecast, you end up with an online brand advertising market of  ~$15B in 2015.  Using Barclay’s market sizing estimates for the base you end up with ~$18B.   So the online brand advertising market will more or less triple by 2015.

That’s great news for the ecosystem as a whole and particularly for the relatively few of us delivering targeted solutions for Brand advertisers.

More on GDN Reserve

Today’s Ad Exchanger published more commentary on Google’s GDN Reserve announcement last week.

Views from senior execs at VivaKi (Publicis) and Group M (WPP) rounded out the additional commentary from Google that was posted Monday.  John also published some additional perspective from Elizabeth and others.

A few things in the various posts caught my eye.  One was simply the difference in perspective between Publicis and WPP – clearly two different strategies at work there.  Another was the refinement in Google’s messaging between the earnings call last week and Monday’s spokesperson (PR) commentary.  Seemed like a careful balance between agency and advertiser in the messaging this time around (what frienemy?).  I also thought VivaKi’s mention of Yahoo! in this context was interesting.  Y! was once the dominant global player in online branding and reserved display marketplaces.  I would have expected more from them sooner, but it’s nice to see the old alma mater at least in the game.  If there’s any road back for Y!, this is it.

I’ll close with a quote from VivaKi’s Curt Hecht:

“While our spending continues to grow in the spot marketplace, clients and publishers still desire the controls and forecasting offered in a guaranteed market around context, price and performance.”

I couldn’t have said it better myself.

This being my 100th sermon from the Brand.net pulpit, it’s nice to see the gospel is spreading.

Hallelujah!

Google launches Display Network Reserve

John Ebbert of AdExchanger and we here at Brand.net noticed the same thing on Google’s earnings call last night – the launch of Google Display Network Reserve, “which gives advertisers the opportunity to buy premium inventory on a guaranteed basis.”

This is interesting for a couple reasons.

First, it’s a clear signal that Google understands where the growth will come from in the display market:  large brands moving traditional media budgets online to follow their customers.  eMarketer laid out the case in December and it’s clear Google understands and agrees; Google launched the guaranteed product because “it’s how brand advertisers are telling us they want to buy inventory.”  We’ve been hearing the same thing loud and clear.

Second, to anyone that still had any doubts about Google’s commitment to or progress in Display:  Wake Up.  Since acquiring DoubleClick 4 years ago this week, Google has moved in a fast, focused way  to lock up all the key pieces of the transactional infrastructure for Display.  They haven’t been shy about it , especially over the past year, but I still don’t think the market fully appreciates how close they are to the endgame:  extending the hammerlock they have on Search to all elements of the Display market.  Scalable, efficient forward buying is the last piece of the puzzle.  It has been Google’s soft underbelly, but they are clearly doing sit-ups like crazy.

It’s crunch time.  AOL, Microsoft and Yahoo!:  If you’ve got a second wind in you, now’s the time.  Accenture, Adobe, Akamai, Apple, Cisco, IBM, Oracle and others:  If you’re serious about bringing your expertise in enterprise class infrastructure and service to the huge advertising market, your opportunity is slipping away.  And Agencies:  I agree with John’s emphasis on the particular phrasing of the announcement.  Don’t let frienemy Google steal a march on you.  If they take the Brand business client direct, that’s a big problem.  Microsoft has Windows and Office to fall back on.  You don’t.

It’s amazing how fast this market is moving.

An Inconvenient Truth

An interesting piece yesterday from Adam Cahill of Hill Holliday, with some great thinking on how to address the quality challenges posed by the evolving real-time digital media landscape.

As Adam correctly points out, for most Brand campaigns delivering results is about more than just protecting a Brand from objectionable content.  That itself is very important (and we’re very good at it, by the way), but it’s only the beginning – “necessary, but not sufficient” as they would say back at MIT.  Media quality involves not just the the text of a page, but the editorial environment in which it exists.  That second bit makes this an even harder technical problem, particularly when you consider that quality is a page-level issue.  So we’re currently left with the false choice between audience and content that Adam correctly suggests we reject.

Let’s push a bit further though.

Without taking too much license (Adam, please feel free to chime in), I think I can safely say that “Audiences vs. content” is essentially a compact way of describing the choice between two different operational approaches.  “Audiences” is shorthand for scalable, efficient, automated buying via RTB on exchanges.  “Content” is shorthand for manual, site-by-site buying.  In the rush for operational efficiency, “audience” buying has grown very quickly over the last 2 years while “content” buying has stagnated, resulting in well-documented challenges for many high-quality publishers.

Audience buying works great when fast, high-resolution feedback on a financial goal metric is possible.

For example, let’s assume Netflix’s goal for a big chunk of its marketing spend is profitable subscriber acquisition and they have conversion value and attribution models that they trust.  Then, just as long as they have a scalable way of keeping their ads away from damaging content (porn, profanity, etc), they can pretty much ignore the editorial quality / “shades of goodness” issue Adam focuses on in his piece.  The tie between editorial quality and performance will show up in the CPA numbers and cause money to move appropriately.   So, for this block of DR money, Netflix can optimize based on their conversion metrics and they’re done.

For a brand campaign, the situation is different.

Brand metrics (e.g., awareness, consideration, intent) take longer to measure, they take longer to translate into financial value and that financial value is most often (95% of the time) realized in an offline transaction.  This means there is no fast, high-resolution feedback on a financial goal metric for Branding, but the push for enhanced efficiency of audience buying is no less acute.  What to do?

Unfortunately, today’s “solution” most often involves substituting for the meaningful data that is lacking some mix of a) meaningless, but conveniently accessible metrics like CTR or b) nice-sounding audience descriptions (like “peanut butter bakers”).   Once these substitutions are made, Brand campaigns can smoothly run through the DR-tuned “audience” infrastructure.  The problem is that these simplifying substitutions require a huge leap of faith at best and are very often detrimental to performance against the metrics that really matter.

The right way to leverage the new real-time online ad infrastructure for Branding is first to carefully test and measure the impact of different scalable, repeatable targeting criteria on *meaningful* metrics (like purchase intent or offline sales).

This process is conceptually similar to the Netflix example I detailed above; i.e., test, measure, optimize.  However, because Brand measurements involve longer time lags and lower resolution, there will need to be some manual effort applied to the process itself before intelligent instructions can be fed into the real-time execution machine.  The machine can’t do all the work itself.

It’s an inconvenient truth, but it’s the truth nonetheless.

Unfortunately, these “meaningful, but harder to get” metrics are too often not even gathered today, so the convenient lie persists.

Reading Adam’s article in this context, the richer standards for quality that he’s calling for essentially represent another set of scalable, repeatable targeting criteria added to the mix, one that he expects to have high correlation with results for brand marketers.  I wholeheartedly agree there would be a lot of value there.  We’ve certainly seen the impact of media quality in our own results.

But I also think it’s important to underscore the higher-level point raised here.  In order for the real-time digital ad infrastructure to be complete, it needs native support for branding that is sadly lacking today.

%d bloggers like this: