Today, as part of its Universal Audience Platform (UAP), NBC Universal announced the launch of its private exchange for digital, display media.
From the release: "Powered by technology from Admeld, the UAP’s private exchange enables NBC Universal to monetize their ad inventory in a controlled, Real Time Bidding (RTB) environment." Read the release.
Peter Naylor is EVP, Digital Media Sales at NBC Universal. He discussed today's announcement.
AdExchanger.com: What was the tipping point for creating a private exchange strategy?
PN: In January 2009 we launched our first campaign with Vivaki AOD in the first version of the DoubleClick ad exchange. At that point we saw a need for a specialized sales and support team to work with emerging programmatic buying teams. In February 2010 we were given the green light to invest in building the UAP team. We did this not only to evolve with our agency partners but also to take back control of our inventory from the ad networks who were selling against our media brands.
With your Universal Audience Platform (UAP), and looking at the opportunity ahead, are you being proactive or is their significant opportunity today in audience buying for NBCU?
We're capturing demand today and positioning ourselves for the future. Some agencies have clearly invested in people and technology that will help lower the cost of buying digital media. That's a serious pain point for agencies right now. Buying digital is considerably more expensive than buying TV. So we're seeing agencies move more budget into buying audiences at scale through efficient means, in terms of process and technology. These agencies are spending incremental media dollars with us today as a direct result of our private exchange. And by incremental I mean the spending is complimentary (rather than cannibalistic) to the premium programs that drive our business. Establishing programmatic buying relationships with our agency partners is an important step in helping them efficiently scale their businesses in the face of growing digital budgets.
How - or in what ways - is this announcement going to affect your guaranteed strategy?
It doesn't affect our guaranteed strategy at all. Our guaranteed display and video businesses remain best in class and revenues continue to outpace industry growth. Our great content drives results for brand marketers through social, mobile, video and cross-platform sponsorships. That's our core digital strategy. What we're doing with our private exchange is unlocking the considerable value in our non-guaranteed display inventory.
Can you share your expectation in terms of revenues or percentages as it relates to revenue lift you expect with AdMeld's private exchange? Perhaps some sample price floors?
From a starting point in May, the private exchange will scale to a multi-million dollar business through the remainder of the year. Relative to the CPMs we've historically received from third-party ad networks, our private exchange inventory is experiencing 400-500% lift.
Beyond the private exchange, what is your strategy with unsold non-guaranteed media? Any changes here?
The UAP is actually a two-pronged strategy for unlocking display value - exchange and direct. We operate the private exchange for the benefit of agency teams that want to employ RTB. We also have a team that leverages audience targeting at scale in our premium environments through non-RTB. So, for example, if a beverage brand wants to reach men 18-34 at scale through in-banner video, we can use our first and third-party data to deliver that campaign through our primary ad server. This product, sold directly to brand planning teams, competes head on with other "premium" ad network offerings. But our direct product is distinguished in two ways. First, we have unique and valuable data sets to improve ad targeting. These are behavioral data points we collect on our users that are unavailable through third-party data companies. Secondly, we have authentically premium inventory. Lots of ad networks are out there talking about "brand safe" inventory. They tend to define "brand safe" in terms of what it is not - it is not adult content, gambling, etc. We can go much further than "brand safe" and actually deliver premium content.
Finally, why should a marketer care about this announcement?
Marketers care about our private exchange because it provides an opportunity for us to deepen our relationships. We've been working directly with brands and their agencies for many years on the TV front. More recently we've brought valuable digital marketing programs to them as well. But a material slice of our inventory was brought to marketers through ad networks. We're pushing those intermediaries aside to make it easier for marketers to find their audiences in our premium environments.
By John Ebbert