Agency trading desks, centers of excellence for scaled digital trading of advertising inside the largest holding companies, may deploy up to $3 billion in the US this year according to Pivotal Research Group. This number is up from zero a mere five years ago when "the desks" emerged on the scene.
And for the fifth year at this year's Advertising Week in New York, we will assemble the global leaders from each of the largest holding companies in the world for their annual check-in and check-up on Thursday, September 26th at 11am at the main stage in the Times Center.
We'll speak with Michael Brunick (SVP, Programmatic, Magna Global, Interpublic); Paul Dolan (SVP, Global Business Development, Xaxis, WPP); Josh Jacobs (President, Accuen, Omnicom); Adam Kasper (Chief Media Officer, Havas Media North America (Affiperf), Havas) and Kurt Unkel (President, VivaKi (AOD), Publicis).
You are all invited and to prepare each of you, we'll be running a series of Q&As conducted by yours truly with each of the trading desk leads right here at MediaBizBloggers.com between now and September 26th, so buckle up as there are lots of exciting opportunities to outline for both sellers and buyers.
To date, most trading desks have captured a performance line item on an advertiser's media plan, fighting to replace advertising network spend. The original promise was to consolidate all scaled spending to both bring control of frequency (many advertisers message the same consumer over and over and over by deploying budget via as many as ten or twenty ad networks at the same time) and bring the forty to fifty percent margin that has been flowing to their ad network back to the trading desk or the advertiser client. Much progress has been made in these areas, although plenty of work remains as many clients are still just realizing the opportunity to capture these efficiencies.
More recently, "the desks" are pursuing a broader remit of automation that promises to give their leaders a much bigger seat at the table with clients and within the ad holding company structure. Far beyond the bottom twenty percent of advertising budget designated to scaled display (real time bidding), automation is inclusive of direct order automation. It's the automation of the buying and selling of all advertising—not just performance, not just display, not just digital. All the holding companies are busy placing large bets in the area of automation—driven from the highest "C" levels. And it cascades down to redefining the role of the 24 year old much maligned media buyer—where the human capital equation is now aiming for a cross breeding of the English lit major from Denison and the math major from Carnegie Mellon. Those sneaker parties may turn into matheletes events one day. It's all progress unless I wind up going to fewer Yankee games (because I know who I'll bump into at the Delta Skybox).
Perhaps the most vocal of the holding companies is Interpublic and its Mediabrands unit. Its CEO Matt Seiler has laid down a BHAG—big hairy audacious goal—of automating a full 50 percent of its buying (all of its buying, not just digital and not just display, but all of it). Publishers have also begun to step up big time, embracing automation to enhance their core advertiser relationships and looking beyond and actively manage all their channels. They are "fishing where the fish are"—as they discover the "fish finder radar" benefit of programmatic insights to see the thousands of other advertisers knocking on their door.
News Corp just announced a global private exchange with Rubicon Project to better control its own destiny in this automated world …"the only way to reach the world's greatest content and the most prestigious and lucrative audiences is directly through our digital properties. Third parties are no longer invited to the party," News Corp Chief Executive Robert Thomson told the press about the deal.
Over the course of our Q&As here at MediaBizBloggers.com and at our fifth annual trading desk event on September 26th, we'll explore the biggest impediments to automation such as workforce issues inside the holding companies, lack of premium inventory available in automated channels and alignment of agency compensation models. And we will ask what the publisher CRO needs to be doing to capture the shifting budgets now available via the automation.
Jay Sears is GM, REVV Buyer for the Rubicon Project. Sears is responsible for global relations with the buy side including ad holding companies, ad agencies, agency trading desks and demand side platforms headquartered in North America. Jay can be reached at firstname.lastname@example.org.
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