The Power of Agency-Tech Company Relationships: A MediaMath Case Study

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Recently, MediaMath, partnered with digital agency PMG to help a global beauty brand address struggles they were experiencing when trying to connect with customers, in real-time.

The brand wanted to deliver its ads to high-affinity audiences in ways that were optimized and personalized. By working together, PMG was able to construct audience profiles in a way that would allow them to target new and dynamic users. The company collected past data into a centralized platform to create current audience profiles built on the history of the customer’s actions. The result was improved ROAS and proof that marketers can improve the user experience of online advertising for greater efficiency for brands.

This represents the potential future of relationships between agencies and tech providers. Lead by CEO Joe Zawadzki (pictured top left), MediaMath believes that by customizing approaches and developing a strategy, a partnership leads to better results for all involved. Agencies must embrace ad technology to stay ahead of their competitors, and by partnering with ad tech providers on a strategic level they can make sure to meet the goals of the brands they are working with. Download the case study, A Triumvirate Approach to Helping a Global Beauty Brand Target New and Dynamic Users in Real-Time.

Adotas explored to subject in a Q&A with Chris Keenan, Director Product Management at MediaMath (pictured left).

Q: This PMG case study, mentions that marketers struggle to connect with customers “due to audience pools that are incomplete, inaccurate, and siloed from activation.” Why does this happen and why is it so commonplace?

A: Incomplete and inaccurate audiences that are siloed from activation are the primary drivers for marketers moving to platforms that have tightly integrated demand side and data management platforms.

We have found that when pushing audience segments from standalone DMPs to DSPs for activation, there is a 10-20% loss in reach due to the cookie sync required. This is particularly troubling when marketers have a granular, niche segmentation strategy. Losing any portion of your low-recency, high-frequency, high-value users results in lower campaign performance.

In addition, cookie-less identity resolution has become a “must-have” as mobile is exploding and the cookie is going away. Three years ago, you could reach 75% of a user with desktop cookies alone. Today, that number is less than 40%. For mobile, you will miss 80% of available RTB impressions without a cookie-less identifier.

A common complaint I hear from friends when I tell them I work in the online advertising industry is “Why am I followed around the internet with ads for a product I purchased days ago?” Another complaint I hear when speaking with marketers is that frequency caps set at the audience level are not respected. This happens when DMPs only update their segments in batch, as opposed to real-time. DMPs that evaluate segment membership in real-time will immediately remove the user who just converted or the user who just received their 8th impression. Not only does real-time segment evaluation drive performance, it also leads to a more positive user experience.

Q: Can you talk more about the pixel resolution/limitations of this client and why they prevented audience targeting?

A: Like many online retailers entering the holiday season, the client had entered a ‘code freeze’ period where they were not able to make any modifications to their existing or place new tags onsite. Code freezes are enforced as a precaution against changes having unintended, negative consequences during historically busy periods that could result in hundreds of thousands of dollars in lost revenue in a very short amount of time.

Fortunately, the client already had global footer and conversion tags placed. From these tags, we were able to ingest standard retail variables, such as Product SKU, Product Brand, Product Price, Search Phrase, Cart Value, and Order Value. These variables, in conjunction with Page URL, were used to develop a granular audience profiling strategy.

Q: How are sophisticated agencies and brands utilizing data to drive campaign performance?

A: Everyone has heard the phrase ‘the right message, to the right person, at the right time’ before, but how do marketers position themselves to deliver on that principle? I have been fortunate to speak with our clients around the globe and here are two common themes amongst the most sophisticated marketers:

• Eliminate latency
DMPs need to have an incredibly tight feedback loop with their DSP counterparts to remove latency between the two platforms. The propensity for users to convert is highest within a few hours, but if your DMP is only syncing your audiences to your DSP once every 8 hours, or worse, once a day, you are losing the opportunity to reach your audience during the most optimal time. Then, once those users have converted, you will still be wasting your media budget on those users until the next time your segments are re-synced.

By eliminating this latency, tightly integrated DMPs can reach the user with a message for complementary product offers instead of wasting the impression with a creative for the product they just purchased. It also allows for capabilities like accurate global frequency capping and sequential messaging.

• Act quickly and decisively
Today, many marketers are waiting for campaigns to run for at least a few days before looking at any analytics regarding the audiences they are targeting. By storing the raw event, impression and click level data, modern DMPs will be able to tell you how your newly created audiences would have performed against prior campaigns, without spending any media dollars against those audiences. If there is not enough 1st party data available, smart marketers generate similar performance reports to determine which 3rd party audiences will help them accomplish their reach goals in a performant manner. These tactics allows marketers to test their hypotheses without burning through their media budgets; further improving their ROAS.

Another benefit of working with a DMP that stores data at the raw event level allows marketers to define an audience segment that is fully populated and ready for activation immediately. The days of creating a segment, waiting for the audience to populate before activating it in a campaign are over. This is particularly valuable unplanned budget is made available and needs to be spent against while still meeting high performance goals. It also means that you can redefine your segment definition on-the-fly while your campaign is still in-flight with your latest learnings/needs (e.g. drive additional reach vs. improve performance) without having to start from scratch.

Q: Beyond Adaptive Segments, what other tech innovations would you recommend marketers and publishers use to accomplish their goals?

A: One innovation that has had implications for both marketers and publishers, and become a hot topic within the last year, is header bidding. For those not familiar, header bidding allows publishers to run a unified auction across their demand partners (e.g. direct sold vs. RTB) for each impression and the highest bid wins. Header bidding provides a level playing field opposed to the legacy, waterfall method where demand sources would be ranked in priority order and only get the opportunity to win the impression if the partners above them passed on that impression first. This means that the publisher’s ad server would serve the $5 CPM direct sold campaign even when there was an RTB partner willing to pay $15 CPM for that same impression.

Q: What does this mean for publishers and advertisers?

A: For publishers, the primary benefit is an increase in revenue due to the increased the “true value” of each impression being recognized. Publishers commonly report a 30%+ increase in revenue after implementing header bidding. This increase in publisher revenue translates into higher media costs for advertisers. However, advertisers now have access to premium, first look inventory allowing them to scale their campaigns in ways that would not be possible in the waterfall world. While media cost is certainly a metric that marketers should pay attention to, they should ultimately be focused on outcome oriented metrics such as CPA and ROAS. Header bidding has the potential to create a win-win for publishers and marketers alike and is an innovation that I’ll be closely.
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