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How to Transform Your Traditional Sell-Side Ad Organization

Credit: Deloitte Digital

As the media landscape continues to evolve, so do advertiser and agency expectations. Media companies, especially those focused on video, are transforming existing ad-side capabilities and developing new ones to meet these changing requirements. However, the results are often mixed, and the journey can be long and resource-intensive. To hone these efforts and remain on the top of media buyers' plans, we've pinpointed several key areas that publishers need to focus on: improving the buying experience, sharpening audience targeting, providing better cross-channel campaign support and offering new advertising experiences.

Most media companies recognize these trends, but it is often unclear how to transform your organization in order to meet them. It requires changes across every aspect of the business—product, sales and channel strategy, audience data management, pricing and analytics, and the underlying technologies and supporting architecture. In many ways, you are being asked to build the new plane while still flying the current one—all while meeting quarterly revenue targets and margin goals. So the question is, how do you drive change in a way that meets buyer's needs and maintains your core business while providing a platform that enables innovation and growth?

To do this, media companies should consider focusing on the following areas as they work on their advertising transformation:

1. Reduce complexity by simplifying the product portfolio.
With the introduction of new advertising products and a shift to more audience-based buying, media companies should consider simplifying product portfolios. In some cases with clients, we have seen the number of products reduced by 60% to 70% and buyer sentiment improve dramatically—which in turn pleases sellers. These changes reduce buying friction and provide an opportunity to introduce new inventory through categories, which can reduce the number of spot and placement restrictions.

How much time would sales and traffic/ad ops teams save with a simplified set of products and ad placement business rules? How would that impact sell-through and make-goods? Could a simplified go-to-market approach provide an opportunity to explore new models such as sponsorships and native content?

2. Evolve the advertising sales operating model to better align with the media buyer.
As agencies continue to evolve their models, media companies follow—most notably by shifting from brand selling to a more vertically aligned approach. However, while many companies have embarked on this journey, many have also failed to complete it. Areas such as organizational alignment, sales performance, and compensation models and supporting processes are frequently overlooked. We often see that by fully executing a sales transformation, organizations reduce associated sales costs by up to 15% to 25%, depending on the organization's maturity.

We also see an underutilization of sales platforms and exchanges on inventory that may no longer require an account executive. Exposing too much or the wrong inventory in an open, or even a private, exchange can have a detrimental impact on revenue, but this underutilization may also lead to a higher cost of sale and missed opportunities.

Does your sales channel strategy and the supporting organization align with buyers in a way to reduce sales friction? Are sales teams incented to drive better results? Are you leveraging sales platforms in a way that focuses account executives and reduces total cost of sales?

3. Better manage audience data and tie demand generation efforts to key segments.
You need to understand the customer to more effectively segment and market advertising inventory, but audience identity management is challenging. According to a survey by AdAge and Neustar, only around 23% of respondents said they believe they are currently using their data management platform to its fullest capacity. In the majority of transformations, standardizing and better managing data is the first step in effectively deploying an audience data strategy. Only by applying governance, processes, policies and technologies in an organization focused on supporting that effort will the full benefits be realized.

But there can also be many quick wins along the way. For example, better aligning audience demand generation efforts with high-demand advertiser and agency segments within the context of your content genres can yield positive results. Too often these demand generation efforts focus on more short-term goals, such as acquisition, versus understanding audience lifetime value and how that can impact advertising sales.

Is your organization effectively utilizing your data management capabilities? How could you better align audience demand generation efforts with advertiser and agency segment requests?

4. Implement pricing analytics capabilities and policies to maintain value.
With the number of micro and macro factors that influence pricing, it is difficult to capture all data necessary to accurately forecast viewer and customer demand. Compound that with an almost unlimited number of product bundling options and a growing number of sales channels, and the pricing process quickly becomes complex. Continuing to leverage ad hoc analytics is no longer sufficient to manage a dynamically changing inventory portfolio across multiple platforms. Instead, organizations should continually evaluate inventory, products and pricing on a near real-time basis in order to identify and act on changes in the market.

What is your pricing and analytics strategy? How are you maximizing value throughout the booking curve? What policies are in place to reduce administrative overhead and accelerate the sales process?

5. Focus technology efforts and employ a flexible service-oriented architecture.
Meanwhile, there's a lot of pressure to do more with less. Management expectations require cutting operational resources while advertisers and agencies expect enhanced capabilities, e.g., cross-platform buying. No one vendor can provide the ad tech stack to support the advertising sales value chain from "pitch to pay." To be successful, it's critical to implement a technology architecture that enables you to maintain core legacy systems while supporting new point solutions.

How is your organization developing and managing application deployments? How are those services identified, prioritized, developed and maintained?

Advertising and media are changing, and publishers are feeling this in their own ways. By focusing on these areas, you can begin to transform your sell-side advertising model to better serve the market and keep you on the top of advertisers' buying lists.

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Deloitte refers to one or more of Deloitte Touche Tohmatsu Ltd., a U.K. private company limited by guarantee (“DTTL”); its network of member firms; and their related entities. DTTL and each of its member firms are legally separate and independent entities. DTTL (also referred to as “Deloitte Global”) does not provide services to clients. In the United States, Deloitte refers to one or more of the U.S. member firms of DTTL, their related entities that operate using the “Deloitte” name in the United States and their respective affiliates. Certain services may not be available to attest clients under the rules and regulations of public accounting. Please see www.deloitte.com/about to learn more about our global network of member firms.
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