John Grudnowski is Founder, Managing Partner of Minneapolis-based FRWD, a digital media services, systems and talent development company.
Grudnowski discussed his agency's structure, client trends and exchange-based buying strategies with AdExchanger.com.
AdExchanger.com: How do you say your agency's name FRWD - is it "forward" or F-R-W-D?
JG: It's both actually. It's F-R-W-D. Essentially it's a bit of an inside joke because most agencies are an acronym, but we are essentially a de‑voweling of a word that we believe in. “Forward” is important to us because we were built and continue to live every day as what we think is a progressive, evolving agency. There are three sides of [being “Forward”]: we have a media services side which would typically be considered a media agency role. And then, we have a media systems component which is really built around speed and accuracy of data collection. Lastly, we have a talent services group which is focused on hiring, training, and placing digital talent into our client organizations.
With training - isn’t there a danger that the business is going to go away if you end up training and placing the client’s internal team?
The thinking is that that is going to happen either way to be perfectly honest. If you think about it, the scale is both on your side and against you. The scale of where digital is going requires varied skill sets. If you try to take on all of that, you become less effective. So really what we do is we think we overcome that by having that centralized perspective of ultimately knowing that what we do today will be replaced in the coming years. By having that concept of “letting go,” we enable a greater speed for our internal teams as well as our client teams.
Looking at your agency's three different units (services, systems and talent), are they all profitable? How does the revenue work there?
We've been profitable since month 2. We're in month 27 right now. We have 37 people. The services and systems business are really combined because they're reliant on each other. We learn more about systems through our services and vice versa. Talent is a separate organization that we have invested in over the last year and it has been profitable for the last three months.
Does your agency ever run into the client’s procurement officer? That's a big discussion in the holding companies and in their larger agencies today.
It varies by client. We have less of a process with procurement on the smaller agency side than you would on a holding company, less interaction. That doesn't mean we don't take our ability to produce value against the cost extremely to heart, but we don't necessarily see that same process.
We're very transparent on rates. Often‑times we're investing above and beyond to continue to be forward‑thinking, to continue to move as best as we can. I would welcome the conversation regarding margins with clients.
What are you seeing from the client side in terms of buying direct versus using exchanges and DSPs these days? Or is it more about custom opportunities?
We do both direct publisher buying as well as a significant of media buying through the exchange. We've essentially used every DSP, tested them, and familiarized ourselves with those technologies. What I see is a split between the brand focus and the DR focus. And I think the DR focus is the most obvious. It's really about the conversion events.
On the brand side it's a bit more tricky. It’s about testing and then scaling.
What about buying or integrating brand awareness campaigns into an exchange buying strategy?
We do that right now. The majority of brand campaigns we work on include buying off the exchange. We’ve seen solid engagement, and very solid reach opportunities through that form of media‑buying. Where we find opportunities to improve and things to continue to build off of is really two sides ‑ the accuracy validation of those data sets, and then the control on frequency against those audiences. As we're buying in real time, it's a little bit more difficult to control that side of the equation, versus buying directly through a very controlled publisher environment.
I think that as we scale those, we'll find greater acceptance of that form of media‑buying, and, to be perfectly honest, we already have.
But you're still using the direct publisher‑buying, to fill out the plan?
Yes. We have deep relationships with publishers, and many of our clients have had decade‑long relationships, so we continue to leverage those.
Are you using tools that provide you some degree of what you see as brand safety? Ad verification?
Every program we run has verification against it. It's really accomplishing two things. One is it's proving to be a more effective spend when we have verification in place, and it's also proving to be a simpler transition and education process with clients in this form of media when there's an enhanced level of verification and control against the exchange world.
What's performing well today in the exchange space? Any inventory pools “killing it?”
To be perfectly honest with you, that is not my everyday focus. I can say, though, that we have seen continued success through Right Media and through the owned‑and‑operated Yahoo properties.
Last question. Thinking about hiring an entry‑level media planner type... what are you looking for in terms of experience there?
What I look for most is a mathematics degree and a very strong head on their shoulders. A logical thinker. I'd prefer a zero‑year‑experience logical thinker versus three years experience at a larger agency taking notes.