AOL to Host Second (Smaller) Programmatic Upfront

Event to Host 150 People, Far Smaller Than Last Year's 700

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AOL is bringing back its "programmatic upfront" for the second straight year. But this time, the company is betting that a smaller, more exclusive event will get the job done better than something on par with the 700-person bash it threw last year.

Only 150 people -- senior VPs and above -- will be invited to participate this year, a significant scaling down of the AOL's flagship ad-tech event. The event is scheduled to take place during Advertising Week later this month.

The point, according to AOL Platforms CEO Bob Lord, is to host a more intimate event where those in attendance will be able walk up to AOL executives for "juicer conversations" after the presentations.

"The event we're going after is to really invite an elite, exclusive bunch of current believers and future believers who are really the market makers, the big spenders around media right now," he said.

The notion of a programmatic upfront may seem a bit counterintuitive -- programmatic inventory is essentially unlimited so there's little incentive to spend money upfront to lock in the good stuff, as is common practice with TV -- but AOL pulled off a successful event last year, bringing in deals with seven marketers and agencies in the range of $10 million dollars each. The company's pitch highlighted its technology's ability to make smarter ad buying decisions over time, hence the ask for an upfront commitment.

When asked if the advertisers met their commitments, Mr. Lord said they exceeded them. Over the past year (Q2 2013 to Q2 2014), programmatic ad revenue at AOL grew from 4% of the company's total ad revenue to 34%. Total ad revenue grew 20% in that span, according to an AOL spokeswoman.

Beyond the pitch
For AOL, the programmatic upfront is more than simply a sales pitch to win advertiser dollars. Last year, the company used the upfront as a pep rally of sorts, trying to make those in the audience feel comfortable with the notion of buying and selling through automated channels.

This year, the company plans to hit those in the audience with a more sophisticated diet of content, touching on everything from attribution to data strategies to programmatic buying of linear TV inventory, the latter of which remains an inexact science. AOL's platform, for instance, is being used today to reserve linear TV inventory, but not traffic the ads.

Though AOL is going it alone for the second straight year, AOL Platforms CMO Allie Kline said other players have approached company to discuss getting involved in the programmatic upfront. "We have had that outreach, we have had that discussion," she said. "Our ideal is that this will become a marker in time in conjunction with advertising week every year where the industry reveals the future of marketing and advertising."

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