March 31, 2014
This year, the Association of National Advertisers is focusing on some really big issues facing the media business. ANA President Bob Liodice's keynote framed them:
- Measurement: Better measurement can help marketers make better decisions, and it is time for the industry to convene a central body to guide the measurement discussion.
- Piracy, fraud, and viewability: These issues have led to the erosion of the value of digital media. Marketers, agencies, and publishers must take notice and address these problems.
- Media transparency: ANA members have told the organization of their concerns about agency trading desks, rebates from media companies to agencies, and programmatic buying. The question is: are agencies and media companies hiding information from marketers, or is this just representative of the new media environment we are living in?
While my flight didn't arrive until lunchtime, the afternoon sessions had some valuable insights in these issues.
John Montgomery, COO North America for GroupM Interaction, made a strong case that programmatic's complexity and technical requirements will make it challenging for marketers to bring their media buying in house, even if they have a great tool. He highlighted that "the right people will be the first requirement." He noted a shift from hiring "a liberal arts graduate who can build a spreadsheet" to hiring mathemagicians: "math grads who can string a sentence together." The key skill for the future: recognizing patterns in data. John also had my favorite quote of the day:
"The advertising business used to be a creative and intuitive business that used data to validate our instincts. Now it is a data-driven business moderated by creativity and instinct."
David Gunzerath, SVP of the Media Rating Council, announced that today the MRC is lifting its advisory on using viewability as a currency in digital marketing. Based on the development the MRC has done as part of the Making Measurement Make Sense (3MS) initiative, the standards and definitions are in place now to begin using viewable impressions as the basis for display advertising buys and will be finalized for online video in 90 days. He reported that the MRC has accredited 11 vendors for display ad viewability.
Aaron Fetters, director of insights and analytics solutions center for the Kellogg Company, followed David with Kellogg's experience investigating viewability of their campaigns. First, they found that poor viewability noticeably depressed sales effectiveness. Using their marketing mix models, he calculated that ads that were at least 70% viewable had 68% greater impact than ads that were only 50% viewable. Using this finding in 2013, Kellogg dropped some sites and pushed others to improve viewability and dropped the percentage of impressions that they classed as poor viewability from 33% to under 12%, proving advertisers can do a better job of viewability today.
During the Q&A on the viewability topic, the question invariably came up of whether media companies will ask for higher CPMs if they improve viewability, and David had the right comeback: "Imagine we're talking about a box of donuts. I've been buying a dozen and just discovered you've only been giving me six. Now I'm just asking you to give me what I've been paying for all along. Paying more is not on the table."
I agree. Or here's another suggestion to the digital media company: If you think these lower viewability impressions have value, you should be paid for, package, and sell them separately . . . if you can. Getting rid of poor-viewability impressions will actually help the digital media industry in two ways: Improve results and reduce the oversupply of inventory that depresses pricing. I believe the media companies should embrace, not fear, viewability.
Tomorrow, I'll be presenting the results of a joint survey Forrester conducted with the ANA that digs deeper into how marketing leaders perceive these issues. Follow these links for a preview:
ANA press release: "ANA/Forrester Joint Survey Reveals Growing Demand for Programmatic Buying Education"
Ad Age: Programmatic buying still a mystery to most marketers
WSJ CMO Today blog: Marketers want more transparency from media agencies
I'll publish a full report of the findings in a couple of weeks.