Keith Pieper is Founder & CEO of Pretarget, a technology company focused on keyword search for display advertising.
AdExchanger.com: You helped found IPG Mediabrands' agency trading desk Cadreon. Can you talk a little about how and why Cadreon began?
KP: In 2006, I was managing a team that serviced dozens of independent advertisers within one of our clients at UM San Francisco. Since these clients came from diverse parts of the company and often had performance goals, they did not always share in the benefits of consolidated media buying. With my technology background, I saw the opportunity to bring some efficiency to the fragmentation by pulling three distinct performance programs into one media optimization effort – affiliate programs, retargeting and CPC – thereby implementing a data driven, technology based solution. This was an initiative called Quantum, and was the precursor to what eventually became Cadreon.
How is Pretarget inspired by your Cadreon days?
I've always been a data junkie - going back to my product days at MatchLogic with "behavioral targeting 1.0". Couple that with my affiliate program and search management experience, Cadreon became a launchpad for me in some ways. It provided exposure to lots of new and established technologies and companies, enabling me to gain a wide perspective. But I always felt there was a magic intersection between search and display. And it's only within the past few years that it became practical to enable data based buying in display. Everyone knows that search works and keywords are king - we now have data and inventory liquidity to make keyword based display buying (at scale) a reality.
It may be early-stage at Pretaget, but what problem do you envision Pretarget solving?
Most targeting today is provided in generic or standardize segments and taxonomies. As a media planner, I was always frustrated with being forced to place a square peg in a round hole. In addition, as a display buyer I always knew that search works. Buyers also know that keywords are king for search and contextual - many advertisers invest heavily in keyword lists which they consider strategic assets. But paid search campaigns miss over 50 percent of clicks for a given keyword - organic clicks that go to a competitor or publisher. We are squarely focused on letting display buyers tap the targeting power of keywords with the impact of display - picking up in search where PPC campaigns leave off.
Who do you see in the competitive set? And, target market?
Our competitive set is anyone vying for part of an IO, and this is largely ad networks today. But while networks have lots of inventory, they don't have scalable search keyword targeting like one might assume. Naturally, we also compete with search retargeting firms like Magnetic, Simplifi and Chango. But our focus is squarely on the display buyer rather than search agencies and retargeting. We also spend considerable time vying to secure data - good sources aren't selling their data outright and those that do are very selective and restrictive with whom they sell to and how its used.
What is the go-to-market strategy in terms of formats or digital channels Pretarget will you address?
Today we are all about search for display. We enable banner buyers to target users who have searched their desired keyword terms (but not yet visited their site). Think of it as search expansion, not retargeting - these are new prospects a given paid search campaign may have reached, but never clicked.
Generally speaking, what's your view on all the hubbub around demand-side platforms and trading desks?
I think there is plenty of confusion over who is what and plenty of companies word-smithing their sales pitch to sound like more than they are. I've always viewed demand side platforms as that - technology platforms for the buyer. Aside from a few home-grown DSPs, many DSPs are merely ad networks who have removed their inventory layer and changed out a logo. This isn't necessarily a bad thing, since many of these platforms have years of R&D behind them and are well proven. The challenges for these DSPs are two-fold: operational focus and how that translates to the customer; and assumptions baked into the platform that may not apply to DSP customers (algorithmically favoring margin rather than goal, for example). Trading desks are the ones that use DSPs to trade inventory and data.
What's your view on how online consumer privacy is being addressed today in digital advertising? What isn't being addressed and should be?
I think there is a fundamental oversight with today's privacy debate: cookie based opt-outs are a fallacy. Unless a user has a login, there is no persistence to ensure that a user's preferences are permanent and maintained over time. For example, if a user opts-out of an ad network, deletes their cookies, and then is seen again by that ad network, the user becomes opted in without even knowing. There are numerous mechanisms and ways to achieve greater persistence than browser cookies (Flash, HTML5, etc), but these have largely been abused and given a bad reputation by a few bad apples. Better solutions are needed.
How will any agency trading desk need to evolve in order to be successful?
Agency trading desks are on the right path towards data driven, audience buying as a complement to deeply engaged, traditional digital media buying. The challenge agencies face is two-fold: getting the entire organization on board with the notion of an audience buy and when it makes sense to include it as part of a media plan; and integrating technology effectively to integrate data and media better than the open market alternative. Audience buying and the potential it brings turns media planning and buying on its head in many ways and requires significant education for adoption. For example, the notion of waste within a media buy has been accepted as standard practice. With audience buying, it is possible to reach only your audience, without any waste. And that may mean you only need 10 percent of your initial budget to reach the audience effectively. That is a real tough concept for many people to grasp. Secondly, agencies typically do not have strong technology DNA. To do audience buying and management right, trading desks need to infuse tech DNA or risk greater competition from ad networks that continue to flourish.
Will IPG be involved in Pretarget? Will you need investment?
Through MediaBrands' Velociter program, IPG is a strategic partner. The relationship brings unique Pretarget opportunities to IPG media agencies and advertisers.
Beyond tactical, startup milestones, what are some of the milestones you would like to have accomplished a year from now?
After search and site retargeting, we want to be the third default line item on every major media plan.
Follow Pretarget (@pretarget) and AdExchanger.com (@AdExchanger) on Twitter.