“Data Driven Thinking” is written by members of the media community and containing fresh ideas on the digital revolution in media.
Today’s column is written by Cameron Hulett, who is Executive Head of Solution Strategy at Acceleration.
Everyone in the digital marketing industry thinks buy vs sell side. Vendors are either helping buyers reach better inventory at lower prices, or on the other hand, helping sellers monetize their inventory better. The obvious exceptions are exchanges, which sit precariously on the fence trying to be impartial.
The problem with this view of the world is that marketers are now also acting as publishers and vice versa. And this is happening in a big way! Think of AT&T who has one of the largest ad networks in the USA. Think of Amazon who has more content than anyone out there. Think of Time Warner Cable. Think of Apple. Samsung. You name it, most large players are now on both sides of the fence. This is because such companies realize the value of their audiences, who both read the company’s content AND buy its products.
Here lies the opportunity – to offer holistic solutions that cover BOTH buy and sell sides for a specific vertical. As an example, imagine a data platform designed for telecom businesses that enables them to leverage data for remarketing as well as sell data driven ad inventory. Imagine a broadcaster having a single customer view of all touch-points across buy and sell sides. Imagine an ad network that could leverage a marketing campaign to drive more ad revenue. Now that’s powerful!
To benefit from this opportunity, vendors need to rethink how they position and deliver their offerings. They shouldn’t be thinking sell vs buy side, they should be thinking media, broadcasting, travel, finance, entertainment, etc.
Each vertical has nuances and idiosyncrasies such as jargon and processes, but on top of that, vertical industries also have specific technology. Just hang out at a broadcaster and you quickly see that it is nothing like a traditional publisher.
To achieve verticalization, vendors need to make four key changes to their business: 1) hire sales people that deeply understand their client’s vertical; 2) reshape their service offerings to deliver vertical solutions that truly matter to the client; 3) deliver technology that fits and integrates into the client’s technology architecture; and 4) develop financial and management reports that show the progress of the vendor’s business by vertical. This avoids the client having to reshape its business to work with the vendor and allows the vendor to deliver and measure true value.
Some vendors have already identified this imperative. Look no further than Facebook, where Carolyn Everson is leading the verticalization charge (more here). Likewise, large vendors like Adobe are going vertical on their product offerings (Site Catalyst is integrating with AdLens; more here). Salesforce.com has been doing it for ages in the mature CRM, soon to be social, space. Criteo and Xaxis are seen as potential buyers of Right Media Exchange, even though this seems crazy from a short-term perspective. Verticalization is happening, like it or not.
Our market is maturing at last and is following the typical evolution curve. Verticalization will become the new norm and vendors who are not incorporating this into their strategy will quickly become dated. Lets see who manages to grasp the opportunity.
Follow Cameron Hulett (@cameronhulett) and AdExchanger (@adexchanger) on Twitter.
