MARK FLAHARTY: We are a full-service solution with a full-service creative team that will soup to nuts work with the client and any of their creative partners. We are creating themes for videos that are pulled together in real-time based on the behavior we see of that user. It’s something no other company has done: generate a video ad in real time via RTB. We have a full creative team.
We have a full business intelligence team, and account services team. That’s not to say in the future we couldn’t create a model much like Google’s for folks who never thought that video advertising was possible for them because they didn’t have the budgets for production or they were a direct marketer who didn’t believe in television because they thought they’d only get 20% composition of the audience.But when you can do 100% of the audience that they want to reach, not only are you able to bring performance and give a brain to video advertising through data, you’re able to open up video to marketers who never before thought it was possible or wanted it.
Do you have a video ad server?
We do. We are a full-service video platform providing personalized video marketing across the marketing lifecycle. We are, in some ways, very similar to what Criteo has done over the last five years. Criteo has taken display targeting to a greater degree of relevance and precision. We’re doing that with video. Six months ago, I would have told you that truly personalized one-to-one video marketing is like time travel. You might be able to mathematically prove it, but doing it is a whole different matter. The video production process is so complex and with video, you care more about what that video ad looks like in the end than any other form of advertising.
Are you a supply-side platform (SSP) or do you partner with the sell side?
We’re not a publisher at all. We’re buying inventory. Like Criteo in the display space, we act very much the same. Anybody who does RTB video, we are buying from. But we are making a distinction. We know how important the brand is and a quality environment is to our customers, so we are making an intentional effort to focus on the best of the best ad experiences, which will then lead to the best advertising and marketing experience for both the user and the client. As a result of that, we’re only buying user-initiated viewing, in-player, pre-roll inventory. We’re not buying in-banner, or anything that would be some questionable content or inventory to maximize performance and quality experience.
Will you ever go publisher direct?
Eventually we will absolutely pursue direct publisher relationships and we’ve had a number of them pursue us to say, “We’re looking at the exchange data [and] ad network data that we’re getting back and you’re spending a pretty decent amount of money with me. Would you like to have a direct relationship where you actually sit one level above the exchange?”
We just really hadn’t had somebody to facilitate those relationships and that somebody is now me, so I fully expect that when we talk in six, nine, 12 months, we will absolutely be evolving in that direction to give our clients greater access to more premium inventory that’s available in the exchange. And that we can get to them more effectively and efficiently…and also brand inventory that’s currently not available in the public RTB domain.
Speaking of premium publishers, why do you think Facebook bought LiveRail? Will we see more supply-side players snapped up?
Facebook knows it’s going to make a lot more money selling a video ad on the newsfeed than a display or text ad. I think there is a confluence of two trends. There is one trend of amalgamation or aggregation. What that means is: I have a certain core competency in display, but video is very rapidly migrating into the digital world both from a content consumption, usage standpoint …so I’d better understand video as well. And we see it again and again. It doesn’t pay to have a core competency in one medium. For the longest time, Google said “I can just do search” and I’ll buy YouTube. But ever since 2006, video was the fastest-growing part of Google for years and YouTube is a $6 billion asset and then mobile came.
The second trend, with regard to Facebook, is they’re saying, “Wait a minute, I can charge 8-10 times more for video inventory than I can display inventory?” If… the people who have funded that company are expecting me to grow at 40% a year, but my traffic is only growing 13% a year, well then they have to do something about it.
Are you saying video is the answer to standard ad net pricing pressures?
Ultimately, you have to get more out of what you have. How do I get more video content? How do I get more video advertising opportunities? The marketplace is hungry for them and they will buy high-quality video opportunities. And publishers are having no trouble selling that inventory and they’re able to make a lot more money. When you look at the confluence of people naturally aggregating so that they can be consistently relevant, as well as video being an opportunity to make a lot more money, that monetization and amalgamation is driving everything we’re seeing right now. Right now in the digital space, there’s just that natural attrition. Some of that attrition is through acquisition, some of that attrition is through folks going out of business, but right now, we’re seeing most of it through acquisition.
What does SundaySky mean by “customer lifecycle marketing” in video?
SmartVideo started with our telco relationships. We worked with them to help them use their first-party data to inform personalized video communication. Our start was more in the realm of CRM, customer service, helping connect clients to their customers using personalized video. But now, they have the ability to take all that information using the power of sight, sound and motion (to help with) prospecting and advertising. We can use the data we glean from the publishing world as we are doing campaigns on their behalf, to help them understand what your customer set is doing. And we have identified a large set of folks who are exhibiting the same behavior but who are not your customer and who have not interacted with you (you can prospect) using a degree of personalized video marketing.
How much ad spend do you manage?
As we are a private company, we do not share details with regard to revenue. But I can tell you that we have grown two to three times every year since we launched SmartVideo in 2011 and that we have a working relationship with over 100 of the largest brand marketers globally.