DAN LAGANI: Video, content marketing and programmatic have grown tremendously and are now the majority of business. Video is a solid double-digit business for us that has grown very significantly. We have video in any range of form factors, from branded content for individual advertisers like L'Oréal and Budweiser to video pre-roll.
Programmatic is a strong double-digit business, up significantly, and what we’ve done structurally to support that is have a meaningful, dedicated staff. We have a VP of programmatic sales [Sheri Ham], and a sales organization that has dedicated specialists as well as generalists in each office.
Talk about the private marketplaces Mode Media has set up.
SHERI HAM: We set out at the beginning of 2014 to build our programmatic business, and that started with a commitment of staff covering the trading desks and teams calling on agencies and brands directly.
With the additional technology resources, we’ve been able to build out a robust PMP [private marketplace] offering. It gives advertisers the opportunity to access premium inventory and first-party data. We have vertical packages that align with Mode’s key verticals, like food, parenting, health and wellness, entertainment, for example. We also have seasonal packages around major holidays and retail holidays that have a combination of contextual and first-party data engagement metrics.
LAGANI: One of the things that we didn’t have a year ago was the ability to buy a premium programmatic package that was contextually relevant around Black Friday. We have built throughout the year a range of calendar-driven, seasonally relevant, contextual ad packages.
Why do calendar-based private marketplaces, like the Black Friday one you mention?
LAGANI: It grows out of the historical strength of the business. The company was founded on idea that there were wonderful mid- and long-tail content creators hyperfocused on single topics. In each of those areas, there was an intense and almost singular focus that was reflective of what those content creators were interested in.
When you look at biggest advertisers were planning, there is seasonality to it, and no one more than retailers. We do business with some of the biggest retailers in country, whether it’s Macy’s or Target, and they have historically bought against that.
How are you working with brands that are buying with you programmatically and directly?
LAGANI: We have a specialist sales organization for programmatic run by Sheri. They’re dedicated to ensuring there is knowledge and opportunity to understand buying against offerings, from the premium direct connection, PMP, or whether it’s through an increasingly smaller market for open inventory.
Sheri’s team also works with the display general sales team. There are many times that the specialists and generalists are out on a sales call together. We are in almost no cases calling on people separately. We want to make it easy for someone to transact in most frictionless way possible. When it comes to larger accounts, we are joint selling. The client always knows they have a single point of contact they can rely on.
It is a very common thing for programmatic specialist and sales lead work together to build out the right level of response. With bigger businesses, it’s the same team on the client side. Even when it’s different teams, both parts are collectively working on the response that’s viewed as a single comprehensive response, and then that gets back to individual stakeholders at the agency and trading desk.
How is the programmatic sales team compensated?
LAGANI: The programmatic sales team is compensated on the programmatic business generated across the platform.
How many private marketplace deals do you have in place?
LAGANI: While we don’t specifically disclose the number of deals, over the past eight months we have significantly increased both the number and type of PMP deals to provide even more customization and flexibility for our advertisers.
How do the CPMs vary for direct deals, private marketplaces and on the open marketplace?
LAGANI: Our primary goal is to grow premium programmatic business, and a range of PMP offerings that provide standard media, rich media, contextual targeting and content-specific offerings, as well as direct guaranteed deals for clients.
This business has moved far beyond the lower CPM business. We’re very bullish that not only programmatic is a growth channel, but programmatic approached as a premium product. With a full range of offerings, it is also going to be a strong CPM product for us as well.
What are your thoughts on talk of banner blindness? How is that affecting your business?
LAGANI: Our focus is on the most relevant way to connect brands with consumers and content creators. We’re moving beyond being a standard seller of display media to many modes, things like native and video. We long ago moved from being a banner-only company.
Do PMPs all compete against each other?
LAGANI: Mode’s PMP product delivery is based on a complex set of rules that range from a brand’s content priority and affinities to yield optimization. With Adapt, our ad server, the conversation has moved well beyond price to ensuring that each client meets as many of their unique campaign targeting needs as possible.
What’s the difference between your ad server, Adapt, compared to other ad servers like DFP or OAS?
LAGANI: Adapt, our proprietary ad server, is a second-generation ad server and was built specifically to handle the complexity that comes with running the kind of highly targeted, large-scale campaigns that are part of Mode Media’s distributed content platform. One example of the sophistication of Adapt is our ability to implement programmatic native advertising across thousands of sites. This is something most servers cannot do.
There’s been intermittent talk of Mode Media having an IPO: The company filed IPO paperwork in early 2013 and raised over $200 million in the past decade. Where are you in that process?
LAGANI: That would be inappropriate for me to comment on.