This "frees them up to focus on strategy instead of logistics and ad trafficking," he added. "Through our software, advertisers can capture over 40 metrics at the site level, including viewability. … TubeMogul isn’t a black box. Advertisers know exactly what's working, and this becomes their intellectual property."
Wilson was adamant that "our self-serve Platform Direct is not an ad network model," citing its BrandPoint product as a tool that enables advertisers to plan, measure and buy based on a digital GRP. The company was an originating founder of an open-source viewability standard and recently partnered exclusively with Integral Ad Science for third-party ad verification.
Among some of those advertisers are Lenovo and CPG company Mondelez International, which went "100% programmatic" with TubeMogul in the last quarter. While Joachim acknowledged that more brands are driving media technology decisions, "it doesn't mean they're taking the software in-house."
He acknowledged an agency is often involved (MediaVest in Mondelez's case) and said TubeMogul gets agencies up and running campaigns on their own after some training. "These models [agency, vendor, brand hybrid] have the least friction in the market," he said. "Agencies have growing programmatic expertise in house."
"We believe the company was early to get ahead of advertisers’ increased calls for transparency, and as Platform Direct becomes a larger mix of the business, gross margins should increase," noted Dan Salmon, equity research analyst at BMO Capital Markets, in a research brief. However, market competition could strain the services and platform take rate.
With TubeMogul's continued focus on international expansion, particularly Australia and China, software installs that allow for remote maintenance and product roll out are attractive to reduce overhead.
"It's much easier for us to set up shop in a new market than companies that are effectively ad networks and need to hire sales people, biz dev people to aggregate inventory while we can be up and running quickly," Wilson said. "Our last couple of client wins have been brands and agencies that are global in nature and they benefit from a software model."