Media Agency Execs on Trading Desks: We're Dealing With Fewer Sellers
Media agencies are generally dealing directly with fewer media sellers, as they increasingly try to use programmatic buying to procure premium inventory, according to an Advertising Week panel on the evolution of the practice. The discussion was moderated by Rubicon Project senior VP Jay Sears and revealed that the shift to include more premium inventory in programmatic deals can create wrinkles in the buying process.
"Programmatic is critical," said Michael Brunick, senior VP-programmatic at IPG's Magna Global. "We are starting to spend more money with fewer bigger and better partners. That gives us leverage."
That doesn't mean their clients' ads are showing up on fewer sites, however. "Ads will show up in more places. We need to use programmatic and technology to do that," he said.
Often holding company trading desks and the individual agencies within the holding company are buying media from the same vendor, though through different means. One challenge is how to manage that overlap.
"We don't want to have two conversations," said Paul Dolan, senior VP-global business development of WPP's Xaxis. "We have one proprietary data platform that covers the entire digital media plan. We decide which parts are integrated sponsorship and which can be more audience-based."
Added Havas Chief Media Officer Adam Kasper: "We have a direct relationship between the trading desk and agency. Publishers are creating a relationship with our teams. Those needs are communicated to our trading group who's setting up those direct deals."
So, asked Mr. Sears, are agencies competing with ad networks? Messrs. Brunick, Kasper and Kurt Unkel, president of products and solutions for Publicis' Vivaki, all said they were in competition, while Mr. Dolan disagreed. Josh Jacobs, president of Omnicom's Accuen, split the difference: "Kind of," he said.
Another hot topic of the hour-long panel was AOL's programmatic upfront held for the first time this year. Mr. Jacobs said AOL deserved a "shoutout" for putting it "on the map." That said, when asked whether there should be a upfront that only focused on programmatic deals or if programmatic should be part of the discussion during the traditional upfront season, most agreed on the latter.
Mr. Sears also asked the panelists to estimate how much of each media dollar today goes toward automated or programmatic, and to predict what that amount will look like in 2015. Their answers:
- IPG's Mr. Brunick: Today it's five cents on the dollar; in 2015 it'll be 50%.
- WPP's Mr. Dolan: Today it's less than five cents on the dollar; in 2015 it'll be seven-to-ten cents of every dollar (though he half-joked that half the total media dollars flowing through WPP is $45 billion and it would be difficult to automate such a large amount in two years).
- Omnicom's Mr. Jacobs: About 15% today and in two years digital spending will be more than 50%.
- Havas' Mr. Kasper: About 4% to 5% of total spending today; in two years that will look more like 15%. Publicis' Kurt Unkel: On average 20% today; in two years more like 40% to 50%.
To wrap up the discussion, Mr. Sears had some fun with word association. Panelists responded in this order: IPG's Mr. Brunick, WPP's Mr. Dolan, Omnicom's Mr. Jacobs, Havas' Mr. Kasper, Publicis' Mr. Unkel, Rubicon's Mr. Sears (moderator and participant).
Word/Phrase: Maurice Levy
Association: Legacy, co-chief innovator, no comment, brilliance, visionary, taller than Sir Martin
Word/Phrase: John Wren
Association: The winner, co-chief innovator, number one, icon, legal told me not to say anything, taller than Sir Martin
Word/Phrase: 24-year-old media buyer
Association: Evolving, quants, training, entitled, potential, mathlete
Association: Vertically integrated, publisher, tech stack, full spectrum, partner, diabolical
Word/Phrase: Year of mobile
Association: 2011, next year, always, right now, next decade, always on