Does Your Agency Need Its Own Trading Desk? Campbell-Mithun Says Yes
Agency holding companies established trading desks to leverage their collective size and buying power.
But that hasn't stopped some small agencies from launching their own digital trading operations. Case in point: Interpublic's Campbell-Mithun has decided to build its own trading desk rather than buy separately through IPG Mediabrands' Cadreon.
The objective? To streamline the planning and buying process and allow deeper integration of data from Campbell-Mithun's retail and CPG clients, which is becoming more important in the digital ad buying process than data purchased from third parties.
"It's about an evolution from a lot of third-party data to really deep integration with first-party data," said Chris Wexler, director of media strategy and interactive for Compass Point Media, which is Campbell-Mithun's media buying and planning group. "This is the way media buying and selling is going. Offloading this capability long-term isn't the right strategy."
Dubbed OdinRTB (the name, from Norse Mythology, refers to a god of knowledge), the trading desk was built for custom data sets held by the Minneapolis agency's for retail and CPG clients, which include Best Western, Chipotle, Betty Crocker and General Mills.
It's an unusual move for an agency that's part of a holding company with its own, big trading desk. Campbell-Mithun is the first of the Interpublic shops outside of a big media agency network to launch its own branded trading operation. Sister creative agencies such as Deutsch and Mullen could tap Cadreon should they need programmatic buying -- but the agency now adds to a growing list of deflectors that also includes marketers.
But as marketers look to better leverage their own data about their customers, it may be a matter of time before other small agencies get into the game.
Casey McGovern, associate director, interactive media strategy at the firm, said it's not just about protecting client data. Bringing trading in-house will enable the firm streamline its relationships with publishers.
The agency is trying to avoid a scenario in which it might work with an online publisher on one plan and then bid on inventory on that same website through a separate trading desk such as IPG Mediabrand's Cadreon. In this scenario there's a danger in driving up rates by bidding on the same website twice, as well as creating separation between the planners and digital buyers, he said.
Additionally, with the in-house trading desk, he said that the agency has a more "holistic view of frequency and rates across publishers."
Still, Mr. Wexler emphasized that for now agency will continue to work with Cadreon on various initiatives. "For us it's about having a complimentary offering for everything Mediabrands can bring to the table."
OdinRTb is currently functioning with a small handful of executives, a technology investment and a score of partnerships with the usual ad-tech suspects, such as Turn, Dataxu, and DoubleClick, among others. Among Campbell-Mithun's clients that are already tapping OdinRTB are Land O'Lakes, KeyBank and GreatClips.
"The expertise we have of tying online activity to offline sales plays perfectly to our clients," said Mr. Wexler, referring to focus on retail and CPG trading. "For CPG brands, 99.5% of sales are offline."
Agency trading desks can be a profit center for agencies through fees. When asked if the agency is in it to boost margins, Mr,. Wexler said no. Still, he expects OdinRTB's contributions "to be relatively significant in our digital billings."