Advertising's Next Growth Segment: Content-tech - Dee Salomon-MediaLink

At the 2008 IAB annual meeting, Wenda Harris Millard heralded the ad-tech revolution with her 'pork bellies and diamonds' speech. Five years later we have seen impressive growth in programmatic and audience-targeted media and a corresponding rise of the ad-tech industry segment. The ubiquitous Lumascape depicts a crowded and complex ad tech ecosystem of companies that emerge, grow, get acquired...and sometimes disappear. These companies have catalyzed a transformation of how display advertising is bought and sold.

A concurrent transformation is occurring as 'content marketing' gains momentum with brands seeking to capitalize on social media and native platforms. Content marketing is not new news. It also has become a source of opportunity for just about every kind of agency in the marketing arena: social, digital, media, creative and PR, not to mention production companies, talent management and conference organizers.

Content marketing has given rise to a raft of emerging technology companies that are being developed to support the creation and distribution of content and advertising for brands. We call this category 'content-tech' and it is to content marketing what ad-tech is to programmatic media.

Here are some examples of companies in the content-tech industry segment:

Bazaarvoice : A ratings and review platform leveraging social content to create dynamic creative messages

Glossi : A tool for consumers and brands to create their own glossy digital magazines

Mixpo : A production platform for generating versions of interactive video optimized for desktop, tablet, and mobile

Outbrain : Native recommendation engine for brand content discovery

Percolate : A content creation platform being used by many brands to optimize publishing to social platforms

Sharethrough: A distribution platform that turns brand content into native ad units across the web

Shazam: The company's "Shazam for TV" product enables audio-activated second screen experiences for brands.

Wibbitz : a text-to-video platform that can automatically turn any text-based article, post or feed into a short video

We have documented the content landscape in this chart showing representative companies from both content creators and the content-tech companies that serve them.

Content marketing challenges many of the time-honored assumptions about media and advertising: those of form and format; content and context. Its allure--closing the gap between a user's experience of editorial and that of commercial messaging --is at the same time its challenge-- a lack of standards that would be the building blocks for scale and, in turn, of wide-spread adoption.

This fact is at the heart of the challenge faced by this category as it goes to market. The ad tech community has a predictable channel to market via media agencies, publishers and other sellers of inventory. The channel strategy is less obvious for the content-tech community. The money sits with the media agencies, yet the actual creative assets for the most part do not. Those assets tend to sit in creative agencies but most frequently they are not created for distribution in ways that best suit the value that the content-tech community can add. Further the creators themselves are not, generally, technologists.

Here are some of the challenges the content-tech sector faces:

1. Education of the creative community to develop campaign ideas and assets that can be made more valuable by the tools being developed

2. Adoption by media owners of these new formats and functionality

3. Acceptance amongst brand owners and their media agencies that a combination of new assets, new metrics and new currencies will transform the process in a way that creates more value.

4. Re-allocation of budget channels to empower the creative community to employ these tools and to develop campaigns around new distribution points.

Brands are re-thinking their marketing structures and agency relationships in light of the opportunities for content marketing. As they do, we expect to see new paths for growth of the content-tech segment. We will write more on the topic of content-tech in future posts; both about the opportunities for content creators and the challenges faced by companies in this burgeoning category.

Dee Salomon is Senior Vice President at the strategic advisory firm MediaLink where her experience in brand marketing, digital media and business development has been put to use by Fortune 100's, global media companies and emerging technology companies. Dee can be reached at dee@medialinkllc.com

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