Why Everyone From Publishers to Sports Leagues Wants to Be an Ad-Tech Company

It's No Longer Enough to Be a Leader in Content

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It's no longer enough to be a leader in content.

Perhaps to please investors but certainly for competitive advantage, media companies are increasingly positioning themselves as advertising-technology firms and putting significant money behind the assertion.

Notably, some of the most successful digital-native publishers are now launching their own ad exchanges or demand-side platforms. The tools are designed to help advertisers buy space in a programatic and cost-effective manner across many related sites -- and at scale.

Politico is the latest to enter the fray.

At an event next month in Washington, the media company will unveil Politico DSP. The platform, according to Peter Cherukuri, senior VP-business development, is designed to give marketers a single data-driven platform to buy premium inventory on sites that reach opinion leaders and policy influencers both inside and outside of Washington.

Cherukuri believes this is an underserved niche that's not being met by the incumbent DSPs. A list of the network's publishers was not available at press time.

Politico is by no means alone.

Last month BuzzFeed said it had formed a network that includes eight sites, such as The Hairpin, Thought Catalog and Dealbreaker. These and other publishers that will soon join the network will all resyndicate BuzzFeed's sponsored posts. This is the first programatic test of its kind for so-called native ads and will help bolster BuzzFeed's significant prowess in data and analytics as well.

BuzzFeed and Politico are being joined by digitally-savvy traditional players. Major League Baseball this month launched a platform with BlueKai that lets advertisers identify affluent audiences based on a range of demographic, behavioral and purchasing attributes and target them across all of its digital properties. It hasn't extended this effort more broadly, but the companies did say they plan to create private exchanges.

While it's easy to chalk all of this up as an extension of what media owners have done for years, there appears to be a deeper meaning. Publishers are collectively observing a growing body of anecdotal evidence that underscores the three corporate strategies all successful digital businesses follow.

First, they continually disrupt themselves in an effort to avoid being disrupted by technology and/or competitors. Consider LinkedIn. It's rapidly disrupting itself by becoming a source for creating and marketing professional content even as it continues to build off its core job listings and lead-gen businesses.

Second, these enterprises recognize that the internet does not reward monoliths; it loves ecosystems. Five of the most powerful digital companies today -- Google, Apple, Amazon, Twitter and Facebook -- are all large multifaceted and powerful platforms that create value for others.

Finally, these leaders know that convergence is a constant. Publishers, as mentioned previously in this space, are rapidly becoming agencies. Meanwhile brands are becoming media companies. And social networks like Facebook are significant ad-tech players.

The lesson: The internet is not black and white. It's a sea of gray.

Politico, BuzzFeed and Major League Baseball are embracing these three truisms. However, they're not technology companies at heart, so it will be fun to watch whether they can successfully compete in an environment where there are others with deeper tech talent and experience.

That said, they are wise to move in this direction, and perhaps marketers would be wise to consider modeling the same approach.

Steve Rubel is exec VP-global strategy and insights, Edelman. steverubel@gmail.com.
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