PROG I/O: Reddit’s Recipe For Success – Know When To Build, Partner Or Kill

jaynepimentelThe top trending post about ad tech on the Ad Ops subreddit page asks the pertinent question: “Is it safe to assume 95%-plus of ad tech companies are full of shit?”

The responses aren't pretty.

“This is the sentiment that our industry has – this post got a 93% upvote,” Jayne Pimentel, Reddit’s revenue and ad operations lead (and the self-described “Queen of Cannabis”), said Wednesday at AdExchanger’s Programmatic I/O show in New York City. “We think of partners as full of shit. We think they’re not delivering anything for us. We rip them out, we put a new one in.”

And that just adds to the swirling complexity of the ad tech landscape, where most publishers are stuck in that uncomfortable limbo that exists between their legacy tech and the shinier new objects they more recently brought on board.

Legacy tech isn’t built to deal with stuff like native and mobile, and new tech isn’t being properly integrated into existing systems, all of which is bad for revenue and a phenomenal time suck. Using multiple systems that aren’t in alignment also makes it difficult to isolate problems.

The result is tech debt – or what happens when “you decided to implement easy, quick, short-term code instead of really bringing together the optimal solution and taking the time to integrate something that will stand the test of time,” Pimentel said.

And while publishers are chasing their tails trying to make it all work, brands are getting sidelined.

Ask any brand what it’s looking for and the answer will probably be: We want an ad served in the US to a human in a brand-safe and measurable environment.

“That sounds simple, right? Just deliver an ad to a human,” Pimentel said. “But we all know how complex our industry has gotten and how complex our ad stacks have gotten that a simple request is almost impossible to deliver on.”

The complexities are so great that key people within a publisher’s own organization don’t even understand how it all works.

“If your salesperson can’t understand how to troubleshoot their own campaigns or the ad ops team or practitioners are out of the office, is your system really built for the modern age?” Pimentel asked.

Most publishers face these issues, and Reddit was no exception.

“These are all the same challenges that Reddit has had,” Pimentel said. “We knew that we couldn’t go from a 1x revenue business to a 2x revenue business if we were using legacy technologies that we weren’t maintaining, if we had transparency issues, if we had high headcounts and if we weren’t close to our engineers.”

The solution for Reddit was threefold: Know when to build it, known when to partner and know when to kill.

“We knew we didn’t want to be an ad tech company – that’s not our business – but we also knew we didn’t want … our employees to do tedious, manual work we knew technology could alleviate,” said Pimentel, pointing to two products Reddit recently built internally, a self-serve platform and a reporting platform that includes campaign spend data and is used primarily by Reddit’s ad ops and self-serve teams.

Its new approach saves time, keeps the headcount lean, ups efficiency – Pimentel said her team manages 2.3 billion impressions per person each month, compared to around 33 million per head for most of the comScore top 100 publishers – and it puts Reddit’s revenue generation in its own hands rather than a third-party system.

But you can’t build it all yourself. Reddit, for example, partners with a supply-side platform for private marketplaces and with Moat on viewability.

“You’ll never be an expert at everything,” Pimentel said. “You can try, but it’s kind of a waste of time and energy. … It’s [about] being an expert in your own domain and letting others be experts in theirs.”

The hardest part, really, is identifying partners and integrating them, said Pimentel, who noted that all partner integrations on Reddit are server-to-server.

“We want to make sure our technology acts as smart pipes instead of dumb pipes,” she said. “We don’t allow any third-party code on our site. … Our engineers take the time to integrate every partner.”

But that’s not enough to streamline the stack – some stuff needs to go out the window. And getting rid of the chaff can often be the most difficult. Killing an initiative in which you’ve invested a lot of time can be frustrating, but it’s worth it in the long run.

“You might say, … ‘I don’t want to kill something I’ve been working on for more than two years,’” Pimentel said. But if it’s something that’s been “weighing on your mind, that’s been fogging up your creative juices, your energies for so long,” killing it means you’d “actually be spending more time on revenue-generating activities.”

 

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