The full pdf is available here: DataXu MarketPulse_Last Click Attribution_July 2010 and below is snapshot of the report.

DataXu MarketPulse: July 2010

“Last Click Attribution: A Simple Way to Misallocate Your Budget”

Data highlights

• For all campaigns, last click attribution ignored 97% of spend driving conversions — which often results in over-spending in search and re-targeting, and under-spending in display that drives demand creation.

• The recommended attribution period for short consideration products, such as CPG, is two weeks. In the campaign shown above, this window includes 90% of impressions  that converted.

• The recommended attribution period for long consideration products, such as Insurance and Autos is five weeks.

• The length of time it takes to attribute 90% of conversions varies by 250%; each product requires its own distinct attribution model

Ultimately, no two campaigns are alike, and what drives their success is tough to predict at the outset, but incredibly valuable to understand.

For the full MarketPulse report, you can download the pdf here: DataXu MarketPulse_Last Click Attribution_July 2010

DataXu’s MarketPulse explores the data that defines today’s digital advertising marketplace. Sign up here to have future MarketPulse newsletters delivered directly to your inbox.

With 3 panels in 2 days, Mike had plenty to say; in fact the Twittersphere did a great job of capturing some nuggets from each of Mike’s panels. But if you weren’t at the events, we thought these 140 character sound bites might be confusing, see the below for some additional context and detail from Mike Baker…

• @audiencescience tweeted “#ommanets We’re at a time where every new feature is a company – Mike Baker – DataXu”

• MB: This was part of a discussion regarding the increasing complexity of the media buying and ad technology space. Here I was making the point that instead of existing companies innovating to include new features, what seems to be happening is that entirely new companies are popping up with products that could have simply been rolled into existing technology platforms thus the space gets more complex and crowded.

• @YahooAdBuzz tweeted (to the wrong DataXu handle – we’re @dataxuinc) “Mike Baker @dataxu says machines can do a better job than people at consolidating a media plan #RMO”

• MB: At the Right Media Open, I was on a panel about the evolution of agencies in the digital media world. I’ve always been of the mind that machine-learning technology, like that of DataXu, can handle the tactical execution of media buying and planning, allowing overburdened media buyers  to focus their energy and time on more strategic marketing initiatives.

• @gregoryhills tweeted “M. Baker appreciates volume discoutn [sic] OMG got from GOOG, but doesn’t understand why they’d use tech from supply side to do allocation #RMO”

• MB: As I wrote about on Forbes.com a few months back, Google’s acquisition of Invite Media and expansion into the DSP (Demand Side Platform) space is exciting and validating for DSP technology, but there are still some concerns around Google’s neutrality.  Google is the largest digital media seller, yet they’re going to remain an impartial  buy- side advocate for OMG?  Seems unlikely.

Stay tuned for more event news and updates and remember, you can always find us on Twitter at @dataxuinc!

As is often the case with rapidly innovating industries, marketers are struggling to master and manage the media planning and buying workflow.  With the recent launch of a coalition dedicated to developing industry standards, it seems that we may finally be able to make the business of digital advertising more efficient.

The complicated display advertising ecosystem (see diagram here) exacerbates work flow issues for agencies and their clients.  Campaign data gets pushed through third party intermediaries, ad networks and exchanges, demand side platforms and more.  Reporting, tracking and reconciliation tends to be manual and thus very inefficient.

Last week, Interpublic and Microsoft announced “MOMS” (Media Operations Management System), a program to overhaul the workflow involved in planning and buying digital media. The hope is that The American Association of Advertising Agencies will expand the initiative to a coalition of agencies, marketers, media and technology solution providers; developing standards for streamlining digital advertising with automated technology processes.

Beyond removing needless cost, initiatives like this inevitably streamline the ecosystem, hopefully weeding out the low value middle men that populate the landscape today, and shining a light on what specific points of value each vendor is providing.  No doubt that these reform initiatives will become increasingly important to the industry’s survival much less growth over the next 5 years, with additional holding companies announcing similar efforts and embracing technology standards that will allow them to better leverage economies of scale in the age of digital data.

In fact, we’ve seen similar reform efforts in other industries; from Enterprise Resource Planning (ERP) systems streamlining resource allocation in the enterprise, to Electronic Data Interchange (EDI) making B2B transactions more standardized and efficient, and even recent efforts in the medical industry to address the security and privacy of health data with the Health Portability and Accountability Act (HIPAA).

Why is the advertising industry so late to the game?

- Mike Baker, CEO, DataXu

(**This piece was also posted on the MarketShare blog at Forbes.com: http://blogs.forbes.com/marketshare/2010/07/16/digital-advertising-efficiency-agencies-ad-networks/)

12:15 p.m. PT, Monday, July 19, 2010:

OMMA AdNets – Los Angeles, CA

An annual OMMA event, this year’s OMMA AdNets seeks to uncover the value in the many layers of the digital advertising ecosystem. Mike will be speaking on a pre-lunch panel, at 12:15 p.m. PT, titled “Simplify the Stack: Fighting the New Cost and Complexity of Media Buying.” Moderated by David Szetala, CEO, Clix Marketing and joined by panelists from Razorfish, Click Forensics and Catalyst, Mike will discuss strategies for improving the efficiency of the media buying process.

7:00 p.m. PT, Monday July 19, 2010:

Dapper Fixing Advertising Panel – Los Angeles, CA

Co-hosted by the Rubicon Project, Fixing Advertising Los Angeles will explore the tremendous changes and opportunities in display advertising today as innovations in user data, intelligent media buying, and dynamic creative drive new efficiencies and performance gains – at a remarkable scale. The panel will also take a deep dive into the ways that the new data-driven ecosystem is affecting publishers, including insights into which data is owned by publishers, how well they are represented by supply-side platforms and whether or not they are capturing enough of the value chain. The panel will be moderated by Peter Kim, General Manager, Yahoo! Smart Ads, and joining Mike as panelists will be executives from The Rubicon Project, Triggit and more.

2:30 p.m. CT, Tuesday, July 20, 2010:

Right Media Open – Chicago, IL

Yahoo’s Right Media Open is an annual event that brings together online advertising leaders to share insights and discuss industry challenges.  This year’s event will be keynoted by Terence Kawaja, Managing Director, GCA Savvian and Randall Rothenberg, President & CEO of the Interactive Advertising Bureau. Mike will be on a panel alongside executives from Cadreon, MEC and MediaBank to discuss the question, “How Are Agencies Evolving to Meet the Digital Future?”

Stay tuned for additional insights, content and recaps from these events.

DataXu’s roots, like the USA’s, will always be in Massachusetts (we’re based in Boston and our technology was developed at MIT), but just as the pioneers ventured West, so too must we.  Adding to our already existing Boston, New York and San Francisco teams, we now have a sales presence in Chicago, Los Angeles and Seattle, and have also added an additional member to our Boston-based sales team.

Boston – Scott Crockett, Performance Sales Manager (scrockett@dataxu.com)

In Boston, we’ve just added Scott Crockett as our performance sales manager.  Scott joins us after almost 8 years at online ad network Burst Media, where most recently as Sales Manager, he helped start and develop Burst’s performance offering.  In this role, Scott oversaw all sales and operations for the team.

Chicago – Chris Lobdell, Sales Manager (clobdell@dataxu.com)

Chris Lobdell has opened our Chicago office and will be heading our presence there as Sales Manager for the Central Region.  Chris joins us from Google where he was a Senior Account Executive selling display advertising on both YouTube and the Google Display Network to Fortune 500 consumer packaged goods brands.

Los Angeles – Tara Steger, Account Executive (tsteger@dataxu.com)

Heading up our SoCal presence, Tara Steger joins DataXu after 5 years as Director of Online Sales with Experian, a global information services company, where she was recently named North America Sales Person of The Year.

Seattle – Dorothee Bergin, Account Executive (dbergin@dataxu.com)

Former Senior Account Manager at Razorfish, and recent MIT/Sloan graduate, Dorothee Bergin has just moved from Boston to Seattle to represent the DataXu team in the Pacific Northwest as our Seattle-based Account Executive.

We couldn’t be happier about our new team members, DataXu pioneers in their respective regions, and we look forward to continuing growth and momentum.

For any questions or to get in touch with our national sales team, please send an email to sales@dataxu.com.

In this month’s issue, we explored campaign performance and the impression attributes that are most highly correlated with conversions and the results were surprising!

DataXu MarketPulse, June 2010

Beyond Audience: What Drives Campaign Performance?

Since the dawn of the Internet, advertisers have been on a quest for the holy grail of digital advertising: delivering the right ad to the right consumer at the right time.  This quest has yielded great insights about how to improve each of these ad dimensions. Consumer targeting is the current priority for some high-profile ad agency holding groups. But which factor is the most important driver of a campaign’s success?

With real time bidding (RTB), advertisers can get closer to the answer than ever before. Impression level data essentially maps the path to the grail. At MarketPulse, we like to look past the hype and let the data do the talking.

With 100s of millions of impressions served daily, we recently evaluated whether consumer, context, or creative attributes of ad impressions were most predictive of conversions.

The result? Each category was well represented, but creative attributes were the winner — correlating most highly with conversions for 48% of the campaigns.

“The data shows that a single campaign performance driver cannot be predicted with confidence in advance. This suggests that a more effective ‘media plan’ is one that instead responds to the nuanced, unique data each campaign generates. The implication is that brands and their agencies need systems that can glean the data and automatically adapt, rather than relying on a rigid, one-size-fits-all approach,” noted Mike Baker, CEO of DataXu.

Our analysis included nineteen large-scale, online display campaigns that ran for at least four weeks, across the leading RTB ad exchanges. In each campaign, we evaluated multiple impression attributes in the categories of consumer (who saw the ad), context (where the ad appeared), and creative (what the ad looked like) to see which attributes appeared most consistently across ad impressions that preceded conversions.

For additional results and takeaways from this month’s MarketPulse, you can download the pdf: DataXu MarketPulse_Campaign Performance Drivers_June 2010

DataXu’s MarketPulse explores the data that defines today’s digital advertising marketplace. Sign up here to have future MarketPulse newsletters delivered directly to your inbox.

]]> http://www.dataxu.com/blog/2010/06/dataxu-marketpulse-beyond-audience-what-drives-campaign-performance/feed/ 4 http://www.dataxu.com/blog/2010/06/agencies-grapple-with-ad-technology-and-its-place-in-a-services-business/ http://www.dataxu.com/blog/2010/06/agencies-grapple-with-ad-technology-and-its-place-in-a-services-business/#comments Fri, 25 Jun 2010 19:02:28 +0000 admin http://www.dataxu.com/blog/?p=314 There’s been a wave of innovation in online advertising over the past year; new ad technology made just for ad buyers (DSPs) are quickly gaining traction as a way to improve media effectiveness and realize operational efficiencies.  DSP’s give agencies a powerful new tool, but the emergence of “buy side technology” is forcing them to grapple with a tricky new issue: how best to build a new technology core into an old services business model.

Some agencies have decided that forming strategic partnerships with external technology providers is the way to go.  Others believe that the best strategy is to try to develop the technology themselves.  While it’s too early to conclude the winning approach, this is an issue that smart clients will monitor as the digital era marches on because it will affect not only agency performance, but also the basic economic structure of the agency-client relationship.

In-house ad tech
The in-house technology approach is probably best embodied by WPP, with its 2007 acquisition of ad network and technology firm 24/7 Real Media.  Since the acquisition, WPP has done a nice job of using these assets to grow an internal innovation engine known as MIG (Media Innovation Group).  In a recent interview, MIG’s Brian Lesser explained some of the reasons for their continued investment in proprietary ad technology:

• More holistic media strategy – can alleviate issues that result from a fragmented media buying approach and result in a more efficient media spend.
• Data-driven marketing – integration of client data throughout the agency’s decision-making process informs the marketing strategy and results in more valuable insights to guide the clients’ campaigns.
• Less data exposure – with in-house ad technology, proprietary data is pushed solely through an agency’s platform and is thus able to be leveraged exclusively by the agency.

Third party ad tech
Alternatively, Publicis and Omnicom have weighed in as favoring partnerships with external ad technology providers.  Curt Hecht of Publicis’ Vivaki business unit recently discussed with AdExchanger their partnership with Internet giant Google, which includes use of Google’s new “house DSP” Invite Media (acquired by Google last month).  And  Omnicom’s Randall Weisenburger explained to ClickZ that they have opted against building an in-house DSP because of the vast benefits technology partners can provide to clients:

• Greater access to innovation – when agencies partner with outside technology vendors, they can innovate more quickly and better align with client needs.
• Focus on core competence – agency resources can be focused on larger strategic considerations that are core to the agency.
• Less risk of agency bias in media buying decisions – advertisers can be confident that an agency’s recommended technology strategy will not be influenced by an in-house proprietary service.

Ultimately, these different approaches are still very new and only time will tell what truly makes the most sense for the agency and for its clients.  But just as advertisers want to know about an agency’s creative approach, it’s now best practice to dig into their technology roadmap.

- Mike Baker, CEO, DataXu

(**This piece was also posted on the MarketShare blog at Forbes.com: http://bit.ly/d0hEX3)

Today, we announced our Audience Optimization program that allows advertisers to easily integrate proprietary and 3rd party data into the DataXu system for advanced audience targeting, optimized campaign performance and sophisticated audience insights.

What makes DataXu’s Audience Optimization unique is actually the same thing that makes DataXu unique, our proprietary learning system.

Unlike other DSPs, DataXu is able to not only target specified audience segments, but actually learn the most effective combinations of creative and context within those segments and apply those learnings to extend the campaign beyond the originally defined audience segment.  This solves the scale problem that plagues pure play audience buying strategies.  DataXu’s real-time bidding system then uses a variable-pricing model to “bid down the curve” or value impressions relative to how closely they resemble the optimal performance patterns.

Here’s how it works in practice: a financial services company is looking to target 34-54 year old males with a high household income for a new “retirement product.”  Their media plan projects a target audience of 2 million consumers  online, but with the specific campaign parameters in play, they are able to reach only 250,000 unique impressions initially.

Using DataXu, the advertiser can then run an Audience Optimized flight across an additional 1.75 million uniques, all of which resemble the consumers that are converting on the offer.  The Audience Optimized flight is built from impression- level data and web site activity and predicts which combination of consumer, ad creative and context signals are most likely to result in a conversion – pattern matching from our learning system.  The media is valued and purchased, and creative selected, based on how closely the pattern resembles the target audience conversions.

For more about our new Audience Optimization capabilities, see the full press release here: http://www.dataxu.com/news/audience_optimization.php or contact us at sales@dataxu.com.

-Mike Baker, CEO, DataXu

Co-founder Bill Simmons said it best “Since our public launch just last September, our team has been working nonstop to continue innovating our platform and growing our company; this recognition from MITX, New England’s leading interactive business and digital media association, makes all the hard work more than worth it.”

The full press release is available here: http://www.dataxu.com/news/MITX_award_win.php

We’re absolutely ecstatic about this honor, as the picture below from http://www.facebook.com/MITX.ORG shows.

Sandro Catanzaro, VP of Products, and Bill Simmons, VP of Technology, show off their shiny new MITX award.

In his first book, “Liar’s Poker,” Lewis observed a cultural transformation changing the business of bond and securities trading at Salomon Brothers.  Why?  In his view, cheap computing power led a “rapid intellectualization” of the field.  So Vinny, the high school graduate from New Jersey with hair coming up from under his shirt, now had to run his bond trades next to a PhD from MIT who could use mathematical models to understand the option value of the security.  As a recent Ivy League graduate, Lewis was given the advice: don’t socialize with Vinny – he might hit you!

In “Moneyball,” Lewis chronicled this same “intellectualization” of the sports industry, as Billy Beane and the Oakland A’s relied on complex statistical techniques to scout and hire the most promising baseball players.  Rather than rely on dated but widely accepted measures of performance, like runs batted in and batting average, people like Beane used the new less obvious measures, like on-base percentage, to identify under-valued talent.

With apologies to Lewis, I offer below my thoughts on how he might one day tell the story of a similar cultural transformation of the advertising and media business:

1. Something the industry has been doing doesn’t make sense? Check

• As the consumer migration to digital media roars on, the business of providing and monetizing the media is more manual and inefficient than ever; basic things like counting, tracking, and improving the performance of advertising are staffed by small armies of low paid workers.

2.    Cheap computing power disrupting the traditional economic structure of the business? Check

• As advertisers look for “faces rather than places”, engaging audience is emerging as the focus rather than placing advertising is premium media contexts.   Google has shown the world that with the right data and algorithms you can conquer the media world.

3.    Math geeks are using advanced analytic techniques to better predict investment ROI? Check

• Predictive analytics, data models, and machine learning algorithms are starting to substantially improve the targeting of advertising and reduce waste.

4.    Tensions exist between the old guard and the new? Check

• There’s a growing stream of angry sounding “algorithms don’t matter” posts from traditional advertising types, although unlike Vinny I don’t think they like to hit people.

5.    The “new math” is creating new winners and losers? Check

• I recently spoke to a senior manager in a media agency who told me that his algorithm-powered “media trading desk” (which buys media through online ad exchanges) produced more profit in its first year of operation than the entire traditional media buying agency from which it was spun out.

The forces at work in the media business are indeed familiar, and most now agree that we are on the cusp of a transformation of the business itself.   I’m looking forward to perhaps one day reading Lewis’ account of it.  Meanwhile, let’s hope the leaders of this industry learn from the mistakes made by Wall Street.

- Mike Baker, CEO, DataXu

(**This piece was also posted on the MarketShare blog at Forbes.com – http://blogs.forbes.com/marketshare/2010/06/07/michael-lewis-and-the-cultural-transformation-of-the-media-business/ )