AdExchanger: What problem do you solve?
JIM DAILY: Teads is focused on supply. We’re an SSP. Our targets are the comScore global top 500 sites – the top premium inventory. On the Teads side, we integrate our technology and become the ad server for our ad formats, which we call outstream formats. We also manage the pre-roll for these different sites as well, so we’re a tech stack for publishers that allows them to make a lot of incremental revenue through new video ad units, and maximize the revenue they’re already bringing in through in-stream.
What’s Ebuzzing and how does its technology fit in with the company’s overall direction?
Ebuzzing was really focused on demand. We’ve grown very fast and we merged with Teads because we had very similar methodologies and philosophies. We’re going to be rolling out a few interesting tools in the next 6-8 months that allow for a lot of control from the publisher side and for the demand side, but we are really building out the private marketplace component because we think that’s what the future will hold for a more automated buy.
In an interview with Beet.tv, you said the company will be 30% programmatic in three years. What does this mean as it relates to private marketplaces?
Demand for the private marketplace setup has increased significantly and it’s happened over the last three months. When people were thinking about programmatic, they were thinking about data-based exchange buys and now people are really getting into the private marketplace. And we’re seeing this domestically.
Interestingly enough in Europe, where ad networks don’t exist with nearly the breadth they do here, the private marketplace concept isn’t very new. But it would typically be driven by publishers and large publishing groups getting together and saying, “Let’s make all of our inventory available on one platform,” so people could buy a few sites in one place. And stateside, I think everyone likes it a lot more because you have more control and the concept is more elegant.
What’s your revenue breakdown at present? Self-serve vs. managed, programmatic, etc.
We have a self-serve platform and it still represents a very small portion of our total business, somewhere around 5-8% but that’s just a gross estimation. That platform is focused more on small and mid-size businesses. When we talk about automated from a programmatic standpoint, it’s a very different target market and we’ve made a lot of capital investment in terms of building out the technology over the last 18 months. We’re seeing money shifting that way, and it’s probably the same cut as that self-serve percentage, that 8% to 10% of total revenue. That’s what I would anticipate for this year. The rest, that 85%, is still managed services.
What is an inRead video unit?
We wanted to take a lot of the phenomenal things you get from Tier-1 players – really high quality inventory – and combine it with some of the good things from a YouTube type platform (guaranteed views on a completed basis) and ad networks (scale). To have high quality, scale with skippable ad formats in contextually relevant environments – we actually had to create new ad formats. They live outside of the video content stream. These units are viewable by design.
inRead was designed to break through the boundaries of pre-roll. How would you illustrate the video ecosystem today since pre-roll commands such a sizable part of it?
You have a few different options for how you can buy as an agency. You can go directly to tier 1 video publishers and that’s all pre-roll – the full-episode players, professionally produced video content like ABC, NBC, FOX, Hulu, ESPN and you want to be associated with their great video content. The drawback is it’s very expensive and the scale is relatively limited because the fact of the matter is, these guys cannot produce enough video content. They sell out on a regular basis. They have no problem selling video inventory. Then, you can go to the YouTube’s of the world with killer scale, good targeting, guaranteed views... and they’re developing a lot of strong content with their influencers, but the majority of it is still user generated content. For some brands, it’s a little sticky, and I love TrueView, but it really depends on what you want to buy. Then you go to ad networks and ad exchanges, which have fantastic scale, great targeting and the tech they overlay is superior to most platforms out there, but there’s not going be a lot of tier 1 inventory, because if these guys are selling it out on their own, there’s not going to be much left for anyone else.
How do you serve publishers?
If we’re working with the likes of The Economist and News Corp. and Reuters, they like in-read formats because if you have a publisher focused on video and they’ve done a lot of video production throughout the history of their company, they’re sold out of pre-roll and they want to monetize their site further with video because of the high CPMs. They love the in-read format because it’s a simple integration, flip a switch and you’re making a lot more money. As an SSP, we also allow some of our partners to white label the products, so Forbes is an example. We’re the ad server for their ad stream products.
What are publishers challenged with?
Publishers struggle when integrating new technology or ad formats with the editorial stuff. The editors should have ownership of how the page looks and if you introduce immersive formats, they tend to push back on that. But the editorial staff loves in-read because it’s clean, it doesn’t mess with the way their page looks, and it’s the path of least resistance to more video revenue, and allows these guys to go programmatic.
And the advertisers?
Our advertisers like it because the inventory is significantly better than what they’d get on any other video platform, and arguably, it solves the biggest issue, which is viewability, in one breath because our viewability standards are if you’re running a 30-second spot, it has to be watched by the person on their screen for 30 seconds without skipping it, so brands love that, the contextual aspect and that they’re significantly increasing their video reach.
Can you give an example of how a brand would utilize your formats?
Let’s make believe you’re in-market for a car and you’re reading an article about the different vehicle type guides. What you will see is our contextually relevant in-read ad unit for Cadillac pop up right within the editorial content. You’ll notice if 50% of the unit isn’t physically displayed on the page, it stops playing. There’s a skip button and it’s only charged to the client based on a completed view. On this page, it [was an article page for the] publisher and very relevant for this advertiser, but you couldn’t buy video on this page before. It didn’t exist. If your user is scrolling an article, scrolls to the bottom, clicks on a link or types in another URL, the brand never pays because the user never decided to sit and watch the whole ad, and if I’m not active and skip, it just disappears and skips right back to the editorial content.
Do you consider what you’re doing “native video” advertising?
When we came out with these units, we toyed with the idea of calling them native units. Sharethrough did a phenomenal job of coining that phrase, but I think the complications with native units in general, is there is usually editorial copy associated with that link somebody clicks, which opens up a video, which is what you’re paying for. When you are trying to distribute editorial copy, that needs to be relevant to the article you’re reading on a page programmatically, unless you have a technology that can read exactly what’s being discussed on the page itself, it’s impossible. You can’t do it yet.
What about native programmatic?
For native, it’s very early in the programmatic stage, but I think what you’ll end up seeing is a lot of ads that are not very relevant to the content that’s being displayed on the page. It’s very difficult to execute native ads on a programmatic standpoint as it stands today. With our ads… it’s just like how you would be buying in-stream through programmatic, except as we’re breaking these out into different content areas for our clients, they’re buying in-market auto content or sports or lifestyle, so the video unit that pops up is going to be relevant to that content environment.
What’s next, people and product-wise?
We’re 400 people now, we’re very big in Europe and a third of our company is developers. We continue to invest in our engineering talent, which is why as we went programmatic, we were integrated with three of the largest DSPs from inception. … The continuous rollout of mobile for in-read and in-mobile products, is really big for us. Then also, building out further the private marketplace agreements for our clients and trading desk partners.