Believe it or not, the advertising industry operates similarly to a finely balanced ecosystem in nature.

Take for instance, the Amazon Rainforest. At 2.5 million square miles, it is the largest self-sustaining ecosystem on earth. To help keep this natural ecosystem vibrant and healthy, three elements work in harmony to keep it in balance: air, water and sun. These interdependent elements ignite photosynthesis for animals to eat, plants to grow, and oxygen and carbon dioxide to continue their delicate exchange.

Just as nature has created a dynamic, interdependent template to sustain life, the advertising ecosystem also needs to be in balance to sustain its livelihood.

The balance of consumers, marketers and media companies

In a balanced and sustainable advertising ecosystem, the three necessary elements are consumers, marketers and media companies.

Each of the three core constituents gets something in exchange for providing something of value to the other. And they each need to work together to maintain order. First, let’s define what each constituency receives:

• Consumers get free or reduced cost access to great content
• Marketers get brand growth
• Media companies get money to continue funding great content

But a well-balanced ecosystem produces valuable ancillary byproducts too, as a result of co-dependent relationships. The exchange of money and inventory between marketers and media companies not only creates access to free or affordable inventory for consumers, but it inherently creates marketplace innovation.

When money is exchanged, expectations rise. And the result of the perpetual engagement between buyer and seller pushes the relationship to drive innovation. Some of the byproducts of this innovation are: data-driven linear, greater privacy compliance and the push for more accurate measurement.

The value exchange between marketers and consumers creates product innovation and customer loyalty. As marketers advertise their products and gain deeper relationships with their customers, their profits increase and they can keep a constant flow of product innovation to fulfill unmet customer needs. Or, in some cases, unknown customer needs. For example, a customer realizing that a traditional mop wasn’t good enough at capturing all the dust and dirt on a kitchen floor until they tried the Swiffer Wet Jet. Another example of a win-win situation.

And finally, the relationship between media companies and consumers has generated greater value for the two sides, as well. In exchange for watching its content, the media company can create more content based on selling more ads at higher prices. And with greater revenue, media companies can create new ways to view that content.

The unwritten value exchange between media companies and consumers has accelerated the growth of OTT and this has in turn provided consumers with more choice, more pricing options and more opportunities to watch advertisements from marketers.

The role of media disruptors

While this intricate dance between media companies, marketers and consumers is akin to walking a tight rope hanging high above the canopy in the Amazon, the natural tension yields great results. The intersection between the three groups is what helps sustain the media ecosystem. It is this delicate interplay that has taken us from newspaper, to radio, to TV, to digital and to OTT.

But there are interlopers who have invaded the media ecosystem and are challenging the equilibrium in new ways. The emergence of Netflix and Amazon in recent years means the media ecosystem’s balance is being challenged (Not surprising that one of the companies to enter the business arena as an ecosystem disruptor chose the biggest ecosystem on earth as their namesake, is it?). 

The value exchange between marketers and consumers creates product innovation and customer loyalty.

When content is provided to consumers without ads, the marketer begins to get displaced. And while OTT is still relatively new, it is accelerating at a fast clip. If marketers remain excluded from this long-standing triad, unintended consequences can create a domino effect.

Marketers need to find new ways to engage and delight consumers, and this means more DTC brands and less money flowing through traditional media companies. As less money (potentially) flows through media companies, they have less to invest in free content, and consumers take the hit. It can become a vicious cycle.

But I am an optimist and always cheer for disruptors. Legacy models that don’t adapt die. And that is a long-learned lesson from the Amazon: adapt or die. In fact, the Galapagos Islands are the second largest natural ecosystem on earth, where Charles Darwin wrote his theory on the survival of the fittest, nicknamed “adapt or die.”

Making the pivot with technology

Advertising technology—embedded with privacy-compliant identity solutions that forecast consumer viewing and identify ways to maximize outcomes—can help the ecosystem adapt to the disruption. Just as air, water, and sun allow a natural ecosystem to adapt and thrive, the advertising industry must also adapt to thrive.

Innovation has been this industry’s energy source from the beginning, allowing us to pivot as the ecosystem evolves. And quite frankly, it’s time for a pivot. I believe we want to maintain a healthy advertising-supported ecosystem. It’s good business for consumers, marketers and media companies.

We must let the disruptors in and learn from them. The weak will get overrun, and the strong will make the system better. After all, Netflix just announced that it’s aiming to have advertising on its platform by the end of 2022. Everyone adapts. And that’s a good thing for all.

The post How to Achieve a Sustainable Advertising Ecosystem appeared first on Amobee.

Who knew that John Lennon was an ad-tech analyst as much as he was a musician?

Although these lyrics are more than 50 years old, my favorite Beatles eloquently stated what is happening in front of us all today. We’re in the midst of a multi-screen media revolution, moving away from practices developed for a marketplace with finite suppliers, fewer screens, and limited data.

For years, the media industry has clamored for “a new way” to operate and execute media in a fragmented, multi-screen, data-enabled market. But few marketers and agencies are walking the walk, or as John Lennon might say, they don’t know how to properly start a revolution.

It is time for the “talk” to stop and for the revolution to begin. Media buyers love facts, so here are a few facts that demonstrate how radically consumer viewing behavior has changed:

• Linear TV ratings down 40% against A18-49 in the past 5 years
• Linear TV ad spending relatively flat in past 5 years
• Average time spent with digital video is up +34% since 2019
• All TV growth is expected to come from Connected TV (CTV)

As consumer behavior changes, so too must the buyer’s approach to the marketplace. So rather than talk about process, it’s time for us to create a process that causes the right kind of revolution that we need.

Waste Not, Want Everything.

Before that first step in the journey takes place, we need to first assess the pain points that lie in front of us. After all, every revolution starts because something is wrong with the status quo, and someone decided that we’re not gonna take it anymore.

The result of significant consumer viewing change and not enough change on the buy side has resulted in excess waste: impressions wasted by targeting the wrong strategic target, or too much frequency against the same person or too much time wasted using outdated models, or inefficient workflows, or lost revenue opportunities. Waste is the enemy in our much needed revolution.   

So, at Amobee we have declared waste “the enemy” and we have created an optimization platform that eliminates waste, restores client value, AND grows ROAS in this fragmented, complex, multi-screen world.  No matter what sector you’re playing — from CPG to automotive to retail to travel — you can scream and sing about needing a revolution, but only action will yield results.

The Way to Less Waste

The first step to eliminating waste is to unify your audience across screens. Most planners spend significant time with their research teams and their clients digging through the vast amounts of data to identify their best prospect. They create and refine their strategic target as if it was the lyrics for the next great song to inspire a generation. They then use this masterpiece target to create their media plan. The amazing thing that happens next is that this strategic target is shared with buying teams, and too often those teams execute buys against old fashion age/sex demos. They throw away the master lyrics and pull out the tried and true song they know by heart. The proof is in the pudding. Less than 20% of the linear TV marketplace is transacted through data-enabled linear buys. CTV and digital video afford the opportunity to bring digital targeting mechanics to premium content, yet too few of the buys are executed against these strategic targets as well. So the first battle in our revolution needs to be to kill age/sex demos and start regularly transacting on strategic targets and high valued audiences across all screens. We can help you do this with ease. 

The next step is to ensure you are working as a unified team. In a revolution, teams need a coordinated strategy for success. A unified team can slay the enemy, a siloed team gets spliced into small brigades that fall to the enemy. This occurs in media when TV, digital and programmatic teams are not playing off of the same playbook. Waste is created across screens when the buy is not simultaneously optimized and executed so that media companies can be tested to secure the best inventory – or as a buyer, you move on to your next choice in your waterfall of options. Handoffs are great in football, but not for the work that Amobee does. It wastes time, money and resources, and is clearly not revolutionary; it multiplies waste before anything positive can even happen.  

In order for a revolution to create momentum — and to chip away at the amount of wasted resources — teams must be inclusive. We will not see the type of change we want unless planning, buying, and activation are done on a holistic basis using data and technology that operates across more than digital alone. When buyers use data-enabled targeting as a base for currency guarantees and optimizations, we start to see savings.

Next, as a revolutionary, you must think like the person you are trying to protect – the consumer. More now than ever, consumers move seamlessly between screens and content to optimize their personal viewing experience based on the best available screen at a moment in time. Marketers and agencies need to approach planning and buying with this same fluid mentality. 

If you are planning and buying in silos, you are playing with tools from the Revolutionary War era, not with tools built for the complexities of the 2020s. For true impact and change, you no longer can plan in silos or even plan sequentially, taking the results of one marketplace (linear TV, as an example) and using that to make better digital direct or programmatic decisions. 

Being linear-aware based on historical performance is the equivalent of being love-aware. It’s nice to know how past love affairs made you feel, but to love in the moment, you have to go all in with your head, heart, and spirit. Dance through the marketplace like the revolutionaries in 1968 during the Summer of Love.

Third, connect your data to technology with a powerful decisioning engine to forecast as opposed to “relying on the past.” The revolution I believe in forges technology AND data science, together, to optimize channels simultaneously, so each channel truly accounts for the others.

There is this myth that many teams defend that there is enough value in linear-aware planning, but that is not enough for the revolution we seek. Here’s the reality: linear-aware is NOT a revolution, nor is it good enough today. Linear-aware planning is only based on historical data and is not a good indication of future performance. You must plan based on forecasted delivery, not on historical delivery.

The media revolution must shift toward “optimized planning,” but that does not complete the journey. You need to tie your planning goals directly to your buying technology. And the only way to get there is to combine inventory supply AND buying modalities into one integrated technology platform to deliver a plan that maximizes reach against your strategic target. You must be able to make decisions that account for linear buys, direct digital buys AND programmatic buys simultaneously. This is the diet of a revolutionary.

So as you sit at your desk frustrated with the marketplace and solutions to overcome the chaos, think about how you can contribute to the Amobee revolution. We ALL play a role in eliminating waste, and together, we can look at how we all shape our clients’ futures.

Nothing would make me happier than to take the media industry forward to unify audiences across channels to optimize for better results, eliminating waste in the system and growing business for all.

Just as John Lennon said, “…you ask me for a contribution…we’re all doing what we can.”  

So here’s my question to all of you: how can each of us play a role in this revolution?  Drop me a line or share your thoughts for everyone to see.

The post You Say You Want A Revolution — So Let’s Do Something About It appeared first on Amobee.