"We think of it like iTunes," he said. "Apple was so brilliant not just building iTunes as a standalone store for music or an iPod as a standalone music player. Steve Jobs put the two together, and although each in isolation would have been interesting, it wouldn't have been game-changing. By integrating the two, without necessarily forcing it, you get the stickiness from owning the device, plus the marketplace of labels and musicians selling music. That's what we're doing with Pathways and the Audience Path and Demand Path offerings."
Although the digital video advertising space has benefitted from a great deal of hype this past year – leading Tremor Video and YuMe to pursue IPOs within two months of each other, and AOL to purchase Adap.tv – differentiation of the players crowding the industry remains a problem.
Collaboration and flexibility: Making its SSP, DSP and platform more distinct also is a shot directed at marketplace operators like BrightRoll, which has focused its publisher relationships as the point of differentiation with buyers, and at the demand-side players like TubeMogul, which works closely with agency trading desks.
Adap.tv's strategy is to be all things to all buyers and all sellers. For example, continuing with the iTunes/iPod analogy, Grenager noted customers don't just have to use the marketplace store to access music on the device.
"Agencies began asking if they could use the tools on other inventory sources like DoubleClick Ad Exchange and with their direct-sales partners," Grenager said. "That's where we've been focused the last few years: developing these stand-alone tools for trading desks. Even though we have this marketplace that we're trying the build, the tool set is actually media-agnostic. Trading desks would not sign up with us if we were just a one-trick pony and all they could do was funnel money into the Adap.tv marketplace."
David Cohen, Universal McCann's global chief media officer, said, "The thing we like best about Adap.tv is that they're a very good collaborator,"
As part of a deal between Adap.tv and Interpublic media unit Magna Global, which serves as an umbrella for UM and its IPG siblings, the agency will integrate its Audience Measurement Platform into Adap.tv's dashboard.
"We've been working on adding AMP into Adap.tv's tech stack for the past few months and that is done," Cohen said. "Now we're working with them to secure linear TV inventory on their platform to serve ads into TV."
Adapting and evolving: Adap.tv began in 2007 and built the SSP and ad server – what is now being called Demand Path – through 2009. While it has signed on many of the large video publishers on comScore, most of the TV networks have tended to sign on with companies like FreeWheel.
But the feeling was that as "programmatic" options started to emerge for display, the idea of serving buyers and sellers in an exchange-based environment seemed like the best business decision a company could make. So next came the Adap.tv marketplace, which gave the company a reason to start having conversations with brands and agencies. With the publisher's inventory to get them interested, Adap.tv began to offer predictive analytics of prices and available inventory as well as data-management tools like the ability to segment audiences.
Those kinds of offerings made Adap.tv more competitive – and helped drive AOL's interest. Still, the business of programmatic video is in its infancy and there are a lot more problems to solve.
For example, the entire industry is still trying to figure out how to do brand advertising through programmatic in a way that is efficient, but also familiar to the old buying and selling models.
"Brand advertising has a problem when buyers and sellers are faced with the question of what exactly to measure," Grenager said. "Digital video buyers are becoming more sophisticated – because they have to. At first, everyone wanted to measure click-throughs, then it was completion rates and along the way, people decided, 'That's not right.' Now people want Nielsen in-target demographic audiences. That's great, since it will allow the digital spending to be comparable to TV. But it's not the end, it's the beginning."