Industry Preview 2016: The Clock Is Ticking For Trading Desk Decentralization

IP-Trading-DesksAs programmatic commands a greater share of marketing budgets, trading desk knowledge will expand throughout organizations.

Accuen expects its trading desk to decentralize when programmatic reaches 70% to 80% of media budgets industrywide, according to Megan Pagliuca, who became the CEO of Accuen after leaving Merkle late last year. That will happen in the next five years, when the industry completes a ten-year evolution toward planning and buying with technology.

During a discussion Wednesday at AdExchanger’s Industry Preview conference, Pagliuca joined Merkle’s Mac Delaney, Cadreon’s Arun Kumar and AdExchanger’s Zach Rodgers to explore the challenges of connecting clients with ad technologies, especially trading desks.

Publicis decentralized VivaKi, its trading desk, in February 2015, but that was a mistake, said Delaney, the head of programmatic at Merkle who left VivaKi last year.

“VivaKi decentralizing was 90% political,” Delaney said.

The group saw an exodus of talent in the wake of that decision. Delaney said decentralization was a mistake because it happened too early and agency finance groups didn’t know how to account for trading desk employees, leaving that area understaffed.

Cadreon global President Arum Kumar does not foresee IPG decentralizing its trading desk. “Break up the trading desk? Absolutely not. You make it more accessible to the rest of the group.”

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At Cadreon, he focuses on bringing planning and buying closer together. If programmatic reveals one audience target is working and another isn’t, that intelligence can be used to influence the plan.

That’s similar to what Pagliuca is doing at Accuen. She said Wednesday she’s halfway through laying out programmatic planning best practices. The company also co-locates teams, which will set the stage for further integration into the main agency, Omnicom.

She highlighted a key new client win, CPG powerhouse P&G.  Omnicom Media Group’s focus on data and analytics played a role in the win. A couple of years ago, Pagliuca said, data wasn’t a core competency of agencies. Now, it has to be.

At Merkle, being known as a data agency has given it a leg up as the world shifts to programmatic, Delaney said. Its data focus means “it’s different people joining those meetings because Merkle is here and it’s a data company,” he said, and both client and agency understand data.

If the rise of programmatic means expanding automation and data throughout the agency, Merkle’s head start is evidenced by where it’s spending its clients’ budgets. Programmatic accounted for 80% of Merkle’s media spend when she left last year, Pagliuca said, a magic number she expects other larger agencies, including Accuen, will reach within the next five years.

 

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