On its surface, a new relationship between BlueKai and Canadian ad startup Datacratic resembles many other data partnerships in the real-time bidding space.
BlueKai will use Datacratic to bring a new "look-a-like" modeling capability to its platform. The DMP's customers can augment already-live campaigns with more reach by comparing the attributes of converters to identify and target new prospects.
So far so good. But dig deeper and the story gets a little more complicated.
Turns out Montreal-based Datacratic is not positioned to do lookalikes. Rather it's a standalone predictive analytics platform. It has no data or media of its own -- it brokers neither -- but will leverage a stream of data from BlueKai and its ad customers to help identify conversion opportunities from the pool of available inventory.
Instead of a look-a-likes seller, Datacratic is more akin to an AppNexus, able to handle real-time decisioning for any purpose. That purpose could be bid management, optimization, or as in BlueKai's case, predictive modeling.
"We were really impressed with their ability to remove bias from their models, the way they cross-validate to output the best models," says Dina Hilal, BlueKai's chief product officer.
Datacratic CEO James Prudhomme tells AdExchanger, "If you think about where the BlueKai relationship can go next, it's about creating a real-time stream of data from their platform to ours, and the models are continuously updated on the fly."
The shift to ad optimization is a pivot for Datacratic. Before last week the company was called Recoset, and sought to make its mark as a recommendation engine. That space turned out to be too crowded, so it shifted to ad tech. It officially renamed itself last week, to position for the BlueKai announcement. "To my mind they have largely defined the category," Prudhomme says of BlueKai. "To be able to work with them and have their data flowing through our platform to apply our machine learning and optimization algorithms to it is pretty remarkable opportunity.
Datacratic has taken $2 million in funding to date and is on an annual revenue run rate of $2 million. Other customers include online shopping club Beyond The Rack and AdGear, a display ad offering from BLOOM Digital Platforms.
On pricing, the BlueKai relationship has Datacratic receiving a percentage of spend for every ad buy that leverages the new predictive modeling offering. That's unlike Datacratic's traditional model, which is based on licensing fees.
With no exclusive media or data of its own, does Datacratic worry about scary words like "commoditization" and "point solution"?
"We do get asked, why don't we have our own data or proprietary source of data?" says Prudhomme. "We see lots of companies are doing a great job of bringing their own sources of data. We see an opportunity to provide optimization and take that data to the next level."