Welcome to the Beginning of the End of the Fragmented Ad Tech World

Maybe the Mayans Were Right, About Ad Tech

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Some say that the ancient Mayan civilization predicted that the world will end in the year 2012. While most people dismiss this as nonsense, the Mayans might not have it completely wrong. 2012 may not mark the end of the world for everyone – but it will mark the end of the fragmentation of the ad tech world. With this in mind, I have put together my predictions for the coming year.

Investors will have their "Uh Oh" moment: This will be the year when investors wake up and realize the chaos they have created by indiscriminately pouring money into our sector. Between 2007 and 2010, venture firms have invested $4.7 billion in online-ad firms and it has created an environment that is filled with a convoluted maze of disparate offerings hurting the market they are serving. And beyond that , the funding has propped up small niches of the ad tech equation that cannot support the exits that the investors are hoping for. There will be some massive hangovers when people wake up after this party.

Innovation will continue, adding to the confusion: The industry will continue to become more complex and technology even more central. The adoption of real-time biddable media buying (RTB) by advertisers will spike dramatically in 2012, driven by sophisticated customization on both the buy and supply side. Data will become cheaper as supply rises. Buyers and platforms will focus more on algorithmic bidding and optimization. Media mix modeling for digital and offline will become more essential. Facebook and mobile will become mainstream and impossible to ignore as advertising channels. And dynamic creative will open new doors for marketers.

Marketers will "Just Say No" to chaos: Marketers and their agencies will come to grips with the time, money and energy wasted simply navigating the technology landscape and attempting to piece together insights from data from dozens of systems. As the market continues to try to do more with less, CMOs will turn away from the chaos that was not serving their best interests and look for a way to simplify.

A perfect storm will form: As the reality of the market becomes clearer to investors, as the technology landscape becomes un-navigable and as marketers stand up and demand solutions that create clarity from the chaos – a change will be inevitable.

Only the integrated will survive: 2012 will be the year the industry faces the great shakeup. The pace of consolidation will increase. Some companies will be bought. Others won't be so lucky. The ad tech providers who will meet the demand to streamline the process of managing, measuring, and optimizing online ad performance across all channels will survive and thrive in 2012. At the center of their solutions will be the combination of technology and expertise, combined into managed service.

This will be a year for the history books. It will not be easy for everyone, but in the end it will leave us with a simpler, more beneficial ad tech landscape – one that will help everyone (marketers, investors, solution providers) reach their goals.

The Mayans were on to something – but who knew they understood ad tech so well?

Will Margiloff is CEO of IgnitionOne, a unit of Dentsu.
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