Q&A: Millennial Media on challenges of getting programmatic right

With millions of active users around the world, advertisers have been forced to adapt to the rising wave of mobile and reach out to consumers through unconventional means.Driving this transformation even further is programmatic buying, allowing marketers to act based on consumer insights provided through data and in real time. However, in spite of the groundbreaking developments technology has brought about, many marketers remain uncertain about the usage of programmatic advertising.Marketing spoke to Robert Woolfrey, managing director - Asia Pacific and Stephen Jenkins, ‎vice president, global marketing & communications of Millennial Media to know more about the issues of understanding the technology, transparency, and the role of media agencies.[More on this topic will be discussed at Marketing magazine’s Performance Marketing conference on 8 September in Singapore.]Marketing: You work closely with media agencies, and you’ve said their importance is not declining. What are the changes they are trying to bring about in the past few years? Woolfrey: There’s an overarching industry discussion there, and then there’s the mobile piece. Nowadays, agencies take mobile more seriously. I think they see it as a new opportunity to build a set of expertise to show value to their clients.In my opinion, media agencies are looking to consistently find ways to show value to their clients, and creative is the one place I can see them start to think about a little more, especially around mobile. In the past, with a lot of mobile companies we’ve basically had to supply creative resources in order to get the media dollars to come into mobile, because they didn’t know how to do it. The creative agencies were also not as interested as they are now, and what we’re starting to see are some of the agencies talking about doing their own creative, so that they can run that creative across multiple earners.So we’re seeing them consider things like data, or how they can build their own DMP so that they’re getting more insights to show value to their clients. I would say that integrating with their data and insights is a big trend, and all of these companies are now building impressive strategies around that.Marketing: We know that mobile is challenging for clients, but what is their biggest concern and how are they getting their head around it?Woolfrey: They’re just learning; it’s not the “why mobile?” now, it’s the “how mobile?” It gets very confusing for clients, because there are so many vendors that go and pitch to them. If a client wants to do location and video, they have to go to different places to get them done.There are a lot of questions clients start asking themselves. “Where do I build my app? Do I need an app? Should I just do a site? If I build an app, how do I continue to get usage on that app? Before I have engagement, do I want to spend this much? How do I distribute it?” Using mobile becomes something that a lot of people can get overwhelmed with, unless they’re really serious about investing in mobile and truly believe in the value of it. However, there are brands out there that have clearly carved out massive investments on how their mobile strategy is going to evolve, be it in terms of e-commerce or marketing. I think we’ve seen a major shift, companies and the way they’re working have evolved.Marketing: Transparency has probably been the single biggest concern for brands, especially with programmatic, but has that changed when you talk to clients now?Woolfrey: I would say that viewability is now a topic that we’re seeing in markets like Singapore and Australia. It depends on which market you’re in to determine where that resonates. Transparency has always been there as a limiting factor for clients; if they don’t know where their ads are going, they’re never going to open to more opportunities. Also, we have to consider brand safety. Brand safety is something we’ve always stood behind at Millennial Media.Nevertheless, viewability is clearly an issue and clients are definitely not going away on the transparency side with respect to the exchange. We actually operate fairly transparently in the exchange, unlike networks that carry a lot of ‘magic’ within and come out with a result. With our exchange, if you’re using an operator with your own DSP, clients are creating those results themselves. They’ve got access to a lot of information in there because the transparency level with Millennial in our exchange pretty high. Unless the publisher doesn’t want to be named for various reasons ­– they might have their own direct sales team or that kind of thing – they won’t be blind in the exchange. Nevertheless, the inventory is pretty transparent in the exchange, and because it comes directly from our SDK we know it’s accurate.Jenkins: Also, I think that is something that’s going to change over time, because if a publisher doesn’t want to be named, it’s at their discretion, and because they’re concerned about channel conflict. Like Rob said, they could have a direct sales team or a company like ours representing them. However, that will change, because if they’re not transparent in the exchange, they’re not going to get the revenue. And not only that, with the technology now they can manage all of that channel conflict. They can set minimum price floors and the type of advertisers they want to accept into their inventory, so I don’t think transparency is going to be an issue for much longer.Marketing: We are increasingly seeing consolidation in the programmatic space which many predict will continue going forward. What is driving this?Jenkins: That's true. We at Millennial Media have been on a bit of an acquiring spree ourselves and see the market further consolidating. Agencies don’t want 70-80 partners or vendors supplying to them, because it’s just a nightmare to deal with. They’re always going to buy on Facebook for a social presence, and they’re always going to buy on Google for search, for example. Where we [at Millennial Media] think we sit is as that third, independent player. We need to be that large player that’s going to sit in on conversations as the mobile specialist, because companies don’t want a lot of people on the plan. I think that’s what’s going to happen over time, and it appears to be our natural evolution.Woolfrey: When I’m talking to agencies now, the discussion has changed. The mobile dollars are getting significant, and they’re looking for their value. In years past – and I’m only speaking for APAC –mobile dollars weren’t necessarily significant enough to be seen on the trading desks. They weren’t significant enough to be seen at the CEO’s level, whereas now they are. CEOs will now be looking into mobile and realising they have over 15-20 partners, and they’ll be trying to consolidate. By spreading themselves too thin, they’re not able to get the learning from the data, and they’ll struggle to see where the dollars actually are. Companies will now be saying, “We want to consolidate down to X amount of mobile partners; we want to work and focus on building those relationships on a scale of learning between them.”Performance marketing will be discussed at Marketing magazine’s inaugural Performance Marketing conference on 8 September in Singapore.To register, please click here or contact Bernadine Reyla at bernadiner@marketing-interactive.com or call +65 6423 0329, +65 9830 4454If you would like to learn more about sponsorship opportunities, contact Soren Beaulieu at sorenb@marketing-interactive.com or call +65 6423 0329