Trouble is, for a long time now, auto dealerships didn’t engage social media in that game-changing light. They focused only on themselves, concentrating their outreach on promoting inventory and generating leads.

This quickly proved ineffective. Dealers lost the few Twitter followers and Facebook friends they had out of disinterest; and once lost, most had no idea how to re-engage their followers.

But a new view of social media is finally emerging among dealers, one that is much more in sync with the reality of why individuals invest themselves in social media in the first place.  They’ve come to understand that social media outlets are not places to troll for leads. Instead, they are places to cement existing relationships and create trust and goodwill.

Put another way, don’t use your social media accounts to look for new customers; leverage it as a way to get closer to those who have recently purchased from you.  These folks have already made an investment in your business.  They’re open to new reasons to come back— for service, for advice, perhaps even an additional vehicle.

Video Steps In

To do all that, you need your Facebook page or Twitter account to be a valuable place your customers come to again and again. And that means offering content that not only deals in their interest, but also is appropriate coming from a dealership.

If people want to be entertained, for example, there is no shortage of Web sites that offer an amusing picture or funny story.  What they want from you is information and support that is commensurate with the very expensive purchase they made at your establishment.

This is where video comes in. Video has the power to convey information faster than any other form of communication. It can introduce your staff, it can inform, it can disarm.  In as little as 30 seconds it can show that you put your customers first—which is what people want most.

So what kinds of videos should you make?  Here are some ideas taken from actual dealer presentations:

• “Unknown” features of your new car that you won’t find in your owner’s manual
• How your car differs from those made five years ago—or even last year
• A short history of the dealership, told by the owner or general manager
• All the free things your dealership offers customers, from clinics and car washes to email service reminders

Don’t feel your social media videos have to be polished or glitzy. People want content, not production values. Short videos (2 minutes or less) that are worth your customers’ time will far outperform expensive, professionally produced mini-documentaries.

What is important, however, is the involvement of your senior staff.  Your customers want to know that you value their social media time. Pushing your social media assignments onto junior employees will give the impression you don’t care.  Get your managers involved—and even encourage them to generate ideas and post entries themselves.

Advanced Applications

Viewed in the context of a social media strategy designed to inform, adding a video-based inventory application to your Facebook page now becomes appropriate. The more advanced vendors in the space include this option as an add-on to their inventory video services.

Along with video, be sure that your entire vehicle inventory is represented with vehicle information and lead generation tools. You can actually have your vehicle video inventory available as a tab of your Facebook page—this will ensure that your vehicle lineup is effectively merchandised when your followers are ready to shop for a new vehicle.

The bottom line is, if you can get your existing customers to follow you in social media by dealing in their interest, you’ll be more top of mind than through any other channel. Nothing—not email, newsletters, direct mail, even TV advertising—has the power to engage like social media. Bringing video into your social media toolkit will improve your power to connect with your customers, and bring more business long-term.

Apparently GDN Reserve was launched during the last quarter, though not to more fanfare like the recent introductions of Google’s Media Ads and various display targeting options. Vice President of Advertising Susan Wojcicki kind of casually mentioned the development during the first quarter earnings call last Thursday.

This premium inventory will be bundled across a “handful of content-specific verticals that consist of numerous publishers who are able to offer quality inventory at scale,” said an unknown Google spokesperson (one day there will be a tomb to the unknown spokesperson — a dark alley on Wall Street where a pleasant, generic and androgynous voice blabs out vague and inoffensive phrases) who gave AdExchanger’s John Ebbert about as little information about the offering as possible.

Advertisers will buy the guaranteed inventory through their GDN rep, though it’s not clear how this inventory fits in with the DoubleClick Ad Exchange. The spokesperson admits the initiative is aimed to please agencies and brands, and said the beta testing went well — then again who says, “The beta testing was awful, man — frickin’ awful”?

So who are the publishers in your neighborhood, Google? Some familiar Google pub partners include Seeking Alpha, Food Network.com, AskMen.com, Epicurious and Wired. The quality of pubs in the GDN has been questioned, so setting aside the classy inventory would seem a smart move to lure in the big ad dollars to its fledgling display program. In comScore’s latest data, Google served 35 billion impressions in the third quarter of 2010, compared to leader Facebook with 300 billion and runner-up Yahoo with 141 billion.

For what seems like forever, Google has been talking about its dreams of display uniting the entire advertising ecosystem — both online and off — with Big G grinning at the top. Google attributed a 27% jump in ad revenue year over year during the first quarter ($8.58 billion) to improvements in its display and mobile ad endeavors. Interestingly, the company reported that revenue from owned and operated sites (which includes search properties and YouTube) grew by 32% while revenue from partner sites chugged away at 19%.

Designed to assist networks and exchanges adhere to the Interactive Advertising Bureau’s recently released Network and Exchange Quality Guidelines — which require those parties to vet their inventory in terms of maturity rating, non-standard and illegal at the beginning of and during each quarter — Adometry’s tool allows for networks and exchanges to ensure the quality of their inventory without draining core resources.

Adometry also aids clients in the paperwork process for IAB certification, while increasing transparency regarding ad placement and reports with tracking IDs that help locate problematic inventory.

Advertising.com Senior Vice President of Publisher Services David Jacobs, the overseer of publisher partnerships, glances over at his colleague Don Kennedy, senior vice president of network sales, and they share a grimace. Jamie Fellows, who heads production management and hails from the network side, even seems to join in on the sour looks although he’s phoning in from Baltimore.

It’s Monday afternoon in San Fransisco — ad:tech has just kicked off and industry pros have flooded the streets surrounding the Moscone Center North. I have a birds-eye view of the digital marketing traffic from the 31st floor of the W Hotel — the Aol/Advertising.com suite, where I’m chatting with the three Advertising.com veterans about the Ad Desk display portal, which in it beta release is focused on midsized agencies and advertisers.

We’ve all been up since 4 a.m. EST, opting out of the video, and there has been a tinge of grogginess to the proceedings until the mention of “self-service.”

Finally Kennedy breaks the silence: “Every time that term comes up internally, someone yells, ‘No! Can’t say self-service!’”

“This isn’t sending advertisers down a channel where they can never talk to anybody,” Jacobs chimes in. “Ad Desk is about enhancement and facilitating and scaling our current approach.”

The Advertising.com team views Ad Desk less as a standalone system than opening its vault of capabilities to advertisers, offering them the ability to directly manage campaigns while also giving access to advanced media planning and reporting tools. The ad network supports all of Aol’s owned properties in addition to a publisher network with 70 of comScore’s 100 largest publishers. Advertising.com’s had a total estimated reach of 184 million uniques in March, according to comScore.

As one of its chief goals this year is broadening its base of advertisers, Ad Desk shoots to please larger advertisers that want more access to reporting and make adjustments to buys on the fly while attracting mid-tier advertisers that are best able to get attention through self-service tools but find account representation handy.

“We don’t want to position it as set it and forget it,” Kennedy says.

Jacobs adds that they might have some clients that use it occasionally as well as those that stick to self service 99% of the time and never talk to anybody within Advertising.com. But hopefully advertisers will take advantage of the service as a true hybrid model.

Advertisers for years have said we’d love to have more access to the tools, and get some more transparency, and “we said, ‘hey, this all fits together.’” Kennedy says. Conceptually it was there, he claims, as previously Advertising.com had a less substantial tool used by a limited pool of advertisers.

Since they began rebuilding the system from scratch in December, Advertising.com has worked directly with advertisers to build an open platform centralized around display advertising. Development of the platform stretched across eight areas of Aol Advertising.

While its still able to monetize substantial swaths of inventory across publisher set, Advertising.com has switched from acquiring inventory on a bulk basis to being dynamic buyers of inventory. Ad Desk gives access to purchased inventory as well as RTB-enabled partners. In effect, the network is passing on its investment in RTB tools to improve advertiser ability to seek out a target audience.

“We’ve done the heavy lifting in a way,” Kennedy quips.

Aol has had a tumultuous six months to say the least after splitting off from Time Warner. Most recently sources reported that by the end of 2010 the company was selling or shutting down the Bebo social network, which Aol acquired in 2008 for $850 million.

The ad side of the equation has also seen some shake ups: Platform-A is gone and affiliate marketer Buy.at has been sold. However, rumors that the Advertising.com network would no longer have access to premium Aol spots were exaggerated at best. Aol has removed some ad placements, leaving fewer nonreserved impressions as well as fewer ad units in general. However, significant amount of premium content is still available to users of the Advertising.com network.

As Aol has realigned its goals with the production of widely disseminated content, Advertising.com too has made linking content and advertising an essential piece of its strategy, Fellows said. At the heart of Advertising.com and Aol Advertising is AdLearn, which serves between 40 and 60 billion impressions per month and makes 10 billion transactional placement decisions daily through analyzing thousands of variables.

“If you look at the math behind it and the scale and complexity of what we’re already doing,” Kennedy says, “It is analogous to being able to monetize vast amounts of content moving forward.”

Ad Desk is only the first step in a dramatic re-imagining of Advertising.com. The team is looking forward to future improvements from the feedback garnered through the initial giving advertisers access to the network’s internal capabilities.

“Networks over the years — and especially us — have had a black box mentality; advertisers would claim we keep a lot of data in and the communication is one-sided,” Kennedy says. “The way we’ve looked at it over the last 12 months… is that we have so many great tools and technologies and access to so much data — so many insights that we can derive from the campaigns we run for our advertisers -– that we really need to be much more external with this.”

Most of what your local paper offers can be found in greater abundance (and at higher quality) elsewhere and, now that everyone is glued to their iPhone, rather than flipping newsprint on their commute, most of that content is only a click (or, more likely, a finger touch) away.

Jobs Section –> Monster.com
Real Estate Section –> MLS, Zillow
Business News –> WSJ.com
Weather Report –> Weather.com
Classified Sales –>Craigslist
Sports –> ESPN.com
Travel Section –>TripAdvisor.com
National News –> WSJ.com
Gossip –> PerezHilton.com

As the above demonstrates, the only area of superior content the local news website has left is local news, and even that has suffered as papers reduce reporting staff and rely more upon outside content providers to fill pages. Although local papers came to the online party rather late, they managed to quickly build reliable websites and leverage their most valuable content effectively.

Monetizing that content has fallen far short of revenue expectations for the most part. The AAAA’s recent report that ad agencies lose up to a third of their media cost servicing digital media buys (as opposed to only 2% with television) was eye opening, but probably nothing compared to what publishers feel.

Back when I was running sales for a Nielsen group, we were struggling with the fact that the same $100,000 once earned by selling a small schedule of print ads was now taking an enormous effort to create.

With print, you are simply selling space. The advertiser provided the content (a PDF) and you put it inside a magazine or newspaper, alongside compelling editorial. Publishers focused on producing the content they wanted and advertisers produced brand ads that appealed to a like audience.

Then, all of the sudden, advertisers started to lose interest in print advertising alone. Sure, maybe they still ran a small print schedule, but now they wanted some content to go along with it: maybe a “microsite” or a custom series of events, or perhaps an advertorial.

Then publishers found themselves allocating resources to writers, designers, and photographers—and acting like a small agency on behalf of their clients. Kind of cool, but the problem was that the advertiser had the same $100,000 to spend. They were all over you, and they wanted stuff like “ROI.” Publishers’ margins were compressed, resources (once dedicated mostly to producing their own content) were misallocated, and their employees were getting burnt out.

Let’s take this to 2007, and the emergence of social media. Now advertisers didn’t even need publishers to develop their content, because they could create their own blogs from scratch (Blogger) and start building online communities (Facebook). Enter Twitter and now every employee in the building has their own mini PR platform which could be leveraged for the company.

Talk about disruption. With thousands of really smart writers, photographers, and designers willing to work cheaply, from home — and with access to free, web-based tools equal or more powerful than any in-house software a publishing company could provide, now publishers were losing the only edge they had: the ability to produce content at scale.

The Googles of the world will always argue that they “need” content providers like The New York Times to continue to provide thought leadership, but web-based content marketplaces like Associated Content and others have only validated the concept that traditional publishers (no matter how big their websites are) are losing their power positions when it comes to content. (Except WSJ, which produces content so exceptional that people are willing to pay for it, but that’s for another article).

So, in this new reality, the publisher is left trying to protect his last tangible asset: his online advertising inventory. He can’t sell subscriptions, he can’t pay to have leadership in any other category besides local news, and now huge sites can geotarget ads to create larger audiences than he has. Spot quiz: who has more unique users in the Anchorage, Alaska DMA: Yahoo or the Anchorage Daily News? I don’t know either, but this is part of the problem.

When the starting point for most computers is search, local media misses the boat on what used to be their wheelhouse. Search for “Anchorage restaurants” on Google, and Fodors, Yahoo, and the local visitor’s bureau sites come up before ADN.com.

In response to this atmosphere of ever-increasing margin compression, competition, customer dilution, and constant need to understand and embrace new technologies, local publishers turned to the experts in online revenue monetization: networks, exchanges, and aggregators. Now (with networks and exchanges), as simple as placing a few ad tags throughout their pages, newspapers could monetize the 70% of inventory they couldn’t sell directly.

Establishing a daisy-chain of ad calls to backfill their unsold inventory was easy, and at least there was some visibility into revenue (amount of impressions available, divided by 1,000, times 65 cents). Despite the ease of use, the rates continue to be painfully cheap, and you never can really tell what the tolerance level of your audience is for an endless stream of teeth whitening, tanning, diet, or Acai berry offers will be.

Aggregators like Centro, LION New Media, Quadrant One, or Cox Cross Media offer a much better solution: real advertisers that need and respect real local inventory. These aggregators provide a great one-stop shop for advertisers and agencies that may not have the depth of knowledge (or personnel) to negotiate and service a multitude of small buys on dozens of local media sites.

As a result these aggregators earn the money they arbitrage by providing the expertise to buy local media at scale. Smarter companies like Centro are leveraging the in-house systems they have developed over the years to navigate this process and making it available to agencies directly (Transis).

However, when it comes to selling premium inventory, specialized sponsorships, or anything beyond standard inventory, the aggregators can’t really play in that space at scale; advertisers still need to partner with local media to make those deals happen.

Ultimately, I see local websites winning by being able to offer more than just inventory. For them, hustling uniques and impressions is a zero sum game. They will never compete against the networks and (with 65-cent CPMs on their remnant space) the networks and exchanges aren’t exactly their best allies.

What agencies need is for technology to help them scale the way they reach advertisers, in an open and transparent way—and systems that give them the ability to do more than place an ad tag on their pages and pray for a good campaign to hit the transom.

We feel the future for publishers is an open marketplace that enables good local media sites to package their premium inventory to advertisers who truly value the local audience: the regional ad agencies across the country who service the local hospitals, schools, banks, and businesses that need local content aimed at local customers.

Ultimately, publishers need systems that can give them placement level control over their inventory, total pricing and deal point control, and access to both agencies and direct advertisers in the same environment. There should be a place between getting a 75-cent Acai berry ad on your homepage and running a $50 CPM rich media expandable.

Publishers need to be able to negotiate both types of deals, and do them at scale, with total control. An open and transparent marketplace that enables publishers to market their entire inventory—not just remnant—is where the future is headed.

I nearly spat out my coffee when the words jumped from his lips — this was blasphemy considering my inbox’s constant barrage of news about real-time bidding and ad exchanges and revenue optimizers and the future of display being an instant, automated system.

Evolve — which is the exclusive seller for numerous affinity sites across the web. the owner of CraveOnline.com and others, and a purveyor of creative and video services — considers itself firmly on the publisher side. While Fitzgerald definitely sees a place for ad exchanges and RTB in the realm, the notion of the two ruling the display space seems a fantasy. Contextual advertising in which publishers and agencies working together to maximize campaigns will always be present, if not dominant.

“At the end of the day, buying a cookie on real-time bidding across eight media-buying platforms for the lowest possible CPM and really out of context… is not as effective as buying in context, on content sites with the right frequency around the creative,” he added.

However, a new report from DeSliva + Phillps Media Investment Bank challenges those notions and predicts a coming display ad marketplace that is primarily technology driven. Those that not only have the best tech but know how to use it effectively will prosper.

According to “Getting Real: Ad Exchanges, RTB and the Future of Online Advertising,” “A significant amount of ad trading will be automated, algorithmic trading, scanning across multiple exchanges and networks in search of optimal impression opportunities to meet campaigns goals and requirements.”

At this point in the game, many exchanges ain’t quite operating in real time. In practice there’s a 10 second delay, meaning that the buyer isn’t getting the total audience he or she paid for, possibly not any of it if that audience has moved on — attention spans in the Internet age are infamously microscopic.

But true RTB, where auctions are purchased and audiences accessed instantly while impressions can be bought one at a time instead of in bundles with varying values, is quickly being implemented.

This allows for cherry-picking impressions or establishing custom block bids and greatly increases buyer power as well as the ability to reach audiences they actually want. The early results, according to D+P, have been eye-opening, perhaps eye-popping.

At the same time, the “barbell effect” is becoming increasingly apparent, with players increasing polarizing to either the publisher or advertiser sides. We’ve got sellers vs. buyers, but hardly anyone in the middle.

Publishers more likely to keep their inventory under wraps for fear of being raped by data companies and DSPs. Blame ad networks — premium pubs (among others) are convinced that allowing ad networks to sell remnant premium inventory resulted in the great devaluing of CPMs for remnant and non-remnant inventory. (But wait, wait, wait — wasn’t offline advertising revenue also dropping like an anvil?)

As premium inventory CPMs crawl back up, pubs are understandably wary about placing their prized slots on those exchange thingies, which look a lot like networks. However, And as new inventory enters the market — including mobile and digital signage pubs may have to play with exchanges… but on pubs’ terms.

“Premium publishers will be more likely to offer their premium inventory on exchange platforms that make ironclad guarantees to protect their brand reputation and proprietary audience data,” according to D+P.

Supply-side platforms can provide guarantees for publishers’ hottest inventory; exchanges, DSPs, data companies and anyone else on the buyer side of town will have to do the same.

Where Oh Where Does Google Go?

Recently Eyeblaster released a report suggesting many conversions attributed to search were stimulated by display. Still, Eyeblaster’s report found that 72% of conversions came from the display channel.

D+P remark that RTB is the glue between display and search marketing, with advertisers guiding a user through search before awing them with a display ad. Through the implementation of RTB in the relaunched DoubleClick Ad Exchange, Google appears to set to make this promise a reality.

If the display ecosystem is polarizing between supply and demand sides and exchanges such as RightMedia — after dumping its non-premium exchange — are leaning toward buyers, ss there such thing as a neutral exchange? Possibly Google, D+P suggests, which likely dominate the non-premium inventory space. But in the long-term, D+P think its likely to move to the demand side.

However, agencies are suitably nervous about Google’s ambitions and question whether they should approach the giant as a collaborator or a competitor. Agency holding companies are building their own DSPs in the concern that, with the acquisition of a DSP, Google could try to bring its services directly to advertisers.

Google is integrating the dynamic display technologies of Teracent, which it acquired in January, into the DoubleClick Ad Exchange while the scope inherent in its AdMob purchase is so awing that the Federal Trade Commission is holding up the merger.

Google has been running a series of articles on its blog about the future of display, announcing that it is “working to provide an integrated solution that enables advertisers and agencies to plan, buy, create, serve and measure display ads across the web, in a single interface.”

Perhaps agencies should be biting their nails.

The Human Quotient

A supply-side platform executive mentioned to me that he couldn’t believe how large publisher sales teams were. As RTB and ad exchanges become more widely used, pubs would realize they could scrap most of their salespeople.

With the proliferation of RTB and the increased use of exchanges, D+P seem to think that algorithms and automation will rule the display space shortly, in some kind of system that makes me think of “The Matrix” or “Terminator.”

But I also keep pondering Fitzgerald’s comments. Advertising is an industry that revolves around connecting with people — something you can’t replace with algorithms. Sure, remnant inventory is on the path to complete automation, but the premium goods? I’m not buying it… yet.

Integrated into the BannerLink offering, customers can create a “brand-focused” sticker-esque ad on top of the
searchable product inventory or an animation that shares space. When a user rolls over the ad, the branded message disappears and the banner expands to display the listed inventory in a video slideshow. Clicking on pieces of inventory gives more details and images within the banner, which also offers sorting controls.

Along with this enhancement, Liquidus has introduced more BannerLink features such as interactive Google mapping technology, multi-seller BannerLinks, advanced product sort options and new ad template styles.

“In order to meet the demand of our advertiser clients, we needed to provide them means to deliver their brand message as well the breadth of their product offering,” said Chris Carlton, executive creative director and co-founder of Liquidus.

Liquidus reports that BannerLink interaction rates have averaged close to 20% since the product’s launch, significantly higher than the average interaction rate of 2.11% for other rich media ads.

The Rubicon Project channels the revolutionary spirit with its new manifesto “Principles of a REVVolution — The Ad Server Is Dead,” which previews Rubicon’s new publisher-centric digital advertising technology and data platform. This platform will enable publishers to monetize content and data at every tier of inventory across all digital mediums with no geographic limitations.

“Working with companies whose real goal is to access more inventory on behalf of their own advertisers isn’t in the best interest of, and may even be dangerous for, publishers,” said Frank Addante, CEO and founder of Rubicon. “Revising… legacy technology, upgrading it, and tacking on bells and whistles isn’t enough: publishers need technology designed specifically to meet their needs.”

In addition, Rubicon’s updated platform will offer automated demand access, self-serve ad sales, a centralized data platform and pricing and intelligence controls. Yield and channel management are available as well as brand, ad quality and malware protection. All features will apply across the digital media spectrum, including web, mobile, video and email.

The demand-side bourgeoisie was too busy eroding the value of publisher inventory to comment.

Assistance could be anything from a tweet, a homepage feature, or an email. One thing is sure: They are using online advertising less for “assisting” in their online user session and more for seeking out what they need.

And how are they finding what they need? Queue in customizable homepages and Facebook news feeds where users are choosing what they want to see, how much, and when. Online users are optimizing their own experiences.

And why shouldn’t marketers do the same thing?

When I go online, I am bombarded by ads for diets and insurance — neither of which has any relevance to me or my online preferences. I often wonder: What is the objective of that particular ad, and what’s the intended call to action? I am not in the market for the latest diet fad (which is most likely a result of seasonality and demo targeting to females 25-54) or insurance (which is apparently a result of buying impression volume).

Could these impressions be better served to someone who is in the market for one of these products or services? Of course, and marketers have the ability to do so.

According to eMarketer, digital spending is one of the only media predicted to experience healthy growth in 2010. One of the reasons is attributed to the data and analytics with proven success metrics. In the world today where the digital ecosystem has endless amounts of data and analytics, why not use this information to better target a message and increase performance?

Analytical insights allow us to target users further along in the purchase funnel with defined timeliness and messaging addressing their needs. It allows advertisers to recognize a consumer’s awareness, consideration, or hesitation for a brand or that of a competitor’s.

There are so many ways that we can learn from user’s actions and use those insights to target the right consumer. Targeting narrows the distribution of impressions to better serve the right message at the right time to the right person.

However, the age-old rule still applies when targeting: You need to recognize who you are targeting, the context in which you’re targeting; when will they see the message; and how you want the message communicated.

If you decide to use targeting, consider leveraging additional tools and options such as dynamic creative and attribution modeling. These allow the key who, what, where, when and how’s to increase relevancy and insight. Advanced targeting techniques such as creative, keyword and site retargeting make the experience more customized and optimized based on users’ behavior or needs.

With my upcoming fun-in-the-sun vacation planned, when I shop online at a well-known sporting goods retailer, they should recognize my search on their site for swimsuits and my history of abandoning my shopping cart with sunglasses prior to giving any personal information.

By leveraging site retargeting and dynamic creative, analytics would allow me to receive a banner in one of my upcoming user sessions featuring the sunglasses I abandoned with summer or beach imagery and an incentive offer for purchasing, such as a discount.

Now if you had a choice of seeing an ad for something you could immediately act upon — free shipping, a coupon, or a special invitation from a Web site you were recently considering a purchase on or another mass targeted ad that has nothing to do with you, what would you choose?

The traditional ad network model achieved many things but has yet to deliver on the promise of truly cost-effective scale. The rules of engagement changed when downward-spiraling CPM prices forced publishers grudgingly onto the emerging exchanges to improve their yield and backfill diminishing ad revenues. The networks had to follow their publishers and a new aggregated sourcing model emerged.

Real-time bidding is the hot feature this year and a staple of the effective DSP. Now the combined capabilities of RTB-enabled DSPs built on the exchange model are replacing traditional ad networks with a new buy-side network paradigm that is more nimble, more economical and more in touch with advertiser goals.

Control is subsequently moving closer to the advertiser, intermediation is being reduced and prices are arriving at a true market-driven equilibrium. Not only do advertisers have more control over targeting, performance and safety, but buying has become more centralized and access to inventory become more streamlined.

It is no secret that LucidMedia has one of the most robust contextual targeting engines in the marketplace, but what we have achieved in the DSP space over the last year has not been widely publicized. Late in 2008 we began engaging all of the large aggregators to codevelop RTB solutions. Next we developed an advanced, proprietary ad server to give us one of the most nimble systems available for trafficking campaigns.

We also built a unified inventory management system that could dispense with the complexity of hard-wiring campaigns to inventory sources. We included an automated optimization engine that can evaluate thousands of campaign facets in real-time, project performance trends, and govern campaign targeting based on advertiser goals.

In January 2009 we deployed the platform internally, effectively making it the industry’s first production RTB-enabled demand-side platform. Named ADvisor DSP™, LucidMedia has since executed hundreds of successful campaigns on the platform and is currently processing up to 45 billion impressions each month. This pioneering experience makes us uniquely qualified to access the necessary features of a successful RTB-enabled DSP initiative.

There are certain universal features that agencies need for any successful DSP initiative. All buy-side platforms must offer multisource RTB integration and scale, an advanced ad server, page-level contextual analysis for targeting and brand-safe filtering, audience profiling for retargeting, universal frequency capping, detailed performance roll-up reporting with discrepancy management and reconciliation, flexible and intelligent bidding strategies, the ability to leverage third-party targeting data and a managed service deployment approach.

Advanced Ad Server: A good DSP starts with an advanced ad server. Core ad serving capabilities like frequency capping, day parting and targeting are minimum requirements. The savvy agency should also look for full-featured holistic campaign management features like cross-aggregator universal frequency capping, pre- and post- impression auditing, preemptive brand-safe filtering, page-level impression verification and hyper-segmented targeting based on content, demographics, behaviors, site, location, and time of day. Discrepancy management and reconciliation are also critical aspects of the built-in ad server.

Integrated RTB: Properly integrated real-time bidding is not standardized or modularized. There is still a great deal of heavy lifting development needed to bring on each inventory source, scale and balance the volume, and bid effectively. A good DSP needs to have these problems already solved.

Intelligent Bidding: Smart bidding strategies are also critical to an agency’s bottom line. The DSP model promises that agencies can claim a larger slice of the ad spend dollar, moving it further and further away from the networks. But without intelligent and flexible bidding, that slice can be lost. Look for detailed graphing of bid price and win ratios and the tools to quickly adjust bidding per source. Look for RTB solutions efficient enough to drive bid costs below the $0.001 threshold.

Retargeting: Another aspect of the successful DSP is the ability to roll up audience and link users to performance for retargeting purposes. Reaching the right audience with the right message at the right time is a core tenet of advertising and although this applies to all mediums, display always reaches its users through a proxy device.

The right platform goes beyond simply rolling up interpolated audience facets and instead segments users into actionable profiles using third party data based on their propensity toward a desired action.

Managed Services: The concept of an agency-side buying and management platform relies heavily on managed services at the inception of any in-house DSP program. The current transitional period is favoring the managed service approach to demand-side platforms as agencies step into the traditional ad network role. Managed services allow the transition and knowledge transfer to happen in the most effective manner.

Optimization: Automated optimization is a differentiator for the demand-side platforms. Historically optimization was the mystical secret sauce of the more technical ad networks but it has become a required attribute of the full-featured DSP. Look for optimization that can juggle thousands of campaign targeting facets, project outcomes, and model performance scenarios prior to launch.

Inventory Sources: Sources and scalability are key factors for every agency to consider. The right platform needs to plug into all the large repositories as well as the more niche aggregators plus the all supply-side optimizers. This kind unprecedented impression potential, scale and broad reach are requirements for large direct response campaigns, major corporate branding promotions and scaled niche segments of very specific demographic traits.

These are the major features — as well as ad network staples like brand-safe filtering, transparent reporting down to the page level and flexible targeting to content, demographics, and behaviors — that an agency should look for when selecting a DSP.

The right demand-side platform allows agencies to easily audit the networks and exchanges on their media plans, efficiently acquire page-level contextually and demographically targeted inventory, ensure brand safety across all sources and most importantly enforce a universal frequency cap. The new breed of DSP with integrated RTB gives agencies pre-impression filtering, post-impression auditing, and allows agencies to cherry-pick the most effective impressions in real time and then feed their campaigns with an optimization engine that automatically maximizes return on spend.