Today, publisher ad server and ad exchange OpenX announced the acquisition of publisher ad tech and services company LiftDNA. According to the release, "With the acquisition of LiftDNA, OpenX brings publishers a better way to optimize their ad revenue by unifying LiftDNA’s next generation SSP with OpenX's premium ad server and its ad exchange into one seamless platform. Since LiftDNA's solution is already integrated with OpenX's platform, LiftDNA by OpenX is available immediately." Read release.
OpenX CEO Tim Cadogan and LiftDNA CEO Vadim Telyatnikov discussed the transaction with AdExchanger.
AdExchanger: Looking at the service needs of the publisher and the ad server, are there aspects to this acquisition that speak to the importance of a service component in your business?
Tim Cadogan: Yes. One of the things that actually sparked a lot of the interaction between the two companies was the degree to which the LiftDNA team was working with the OpenX team to help solve customer's problems and drive their revenue. What the team has built is almost like an embedded ad ops or a revenue management function for their clients. So they're spending a lot of time with clients helping them think through and execute on how to make more money and how to tweak the way they're using the ad server. They put themselves in a unique situation because they're operating within the publisher's ad server and not a remote third party service.
And so very quickly the LiftDNA team has become a trusted confidant of the publishers who are using them. For us, importantly, it was a direction we wanted to go in. We're here to help the publishers make more money and that is a combination of giving them good technology, liquid marketplaces with a lot of options, whether they be traditional network demands or real-time demands, and service and assistance.
For us, that was one of the three or four most important things. It was these guys had built already a pretty strong competence in this area and that was something we felt we could benefit from. Vadim, it's close to your heart so you probably have a perspective on that, too.
Vadim Telyatnikov: When we speak to the publishers one of the things we talk about with them is how to view us. In a lot of cases, it's as an extension of their ad ops team. They'll call us with all sorts of questions. It might be around, "How can I traffic this campaign?" to "Why isn't my campaign delivering?" to "Which vendor should I choose?"
Due to how many companies are in the space, it's hard for publishers to know. Everybody pitches similar things, and it's hard for publishers to digest that and know which companies can add-in value and which ones can't. We can help them figure that out.
What do you think the biggest impact would be with acquiring LiftDNA in terms of a publisher's inventory? Will it be on the guaranteed side or non‑guaranteed?
Tim Cadogan: The main impact is going to initially be in non‑guaranteed. What we're now going to be able to do is bring a more comprehensive solution to non‑guaranteed, so that's the first port of call. LiftDNA has been delivering 50 to 150 percent revenue increases to publishers on top of their traditional SSP solutions with what his team has been doing. So, that's going to move the needle there first.
Now, a little down the road. One of the things we're excited about is now, that we've got full visibility into the total yield curve. We do hope to be able to start to move the needle on the guaranteed side as well by having and being able to leverage the pricing insight we have now to help the publisher make more money out of their guaranteed as well as their non‑guaranteed. But near term, the impact is going to be in non‑guaranteed
Vadim Telyatnikov: When we started that my thesis was that everything should be optimized against a single holistic yield curve where yield is yield and revenue is revenue. There's no reason to put them in two separate buckets. Even when I was at My Yearbook, we received campaigns from a direct salesperson which would monetize lower than what we could sell at remnant prices. It just didn't ever make any sense to me. The vision then is to have this in one platform, one yield curve where everything is being managed in one place to maximize revenue.
Tim Cadogan: That's why we originally put the ad server and the ad exchange together. The ad server had the premium guaranteed campaigns and unsold could flow through to the real-time demand of the exchange. This brings through other classes like ad networks, other SSPs and exchanges and that makes it all compete on one level playing field so you make the most amount of money. That's the heart of it really and what we can now actually fully deliver.
What was the catalyst for acquiring LiftDNA?
Tim Cadogan: LiftDNA was working within our ad server. For us, we've been scaling and doing a nice job for publishers, but we were not a 100-percent built solution and more and more, we saw how well the market was doing. We also saw that people wanted us to do more for them and in order to fulfill the vision that we had, we needed to be able to take care of all of someone's inventory. That meant we needed a yield management solution to be part and parcel of our platform. That progressive realization coupled with the practical reality of, "Hey. We're actually working with someone who does this who is exactly aligned with us and are essentially kindred spirits."
Those things came together as the push of, "Hey. We think we should do this." And the pull of, "We're actually working with someone who does it in exactly the way we think it should be done, in this breakthough way of doing it in the ad server which is exactly the way we think the world should work." That's what led us a couple of months ago to start to talk more seriously about, "Why don't we actually put this together?"
Vadim Telyatnikov: It was exciting. I remember sitting down with Tim and the first conversation we had, talking about the vision strategy. We almost felt like we were finishing each other's sentences. We had the same vision. We focus on the publishers. The same philosophy that this should be a unified platform inside of the ad server. The teams already knew each other and worked together so it was just a very, very natural fit.
Finally, what happens to the LiftDNA team? How will it be integrated?
Tim Cadogan: Vadim is going to continue to lead the LiftDNA business, and the whole team is joining OpenX.
We will be keeping and growing the office in Philadelphia while also further building out our presence in New York.
By John Ebbert