Today, remnant, or unsold, media has been pointedly addressed by real-time biddable exchanges and their partners in comparison to the direct-sold market. But, Shiny Ads founder and CEO Roy Pereira says that in the last six months his company has seen a “warming up” from publishers in regards to creating efficiencies in the direct sales processes and adding some programmatic automation in the display ad sales channel.
And that’s exactly where he hopes his company can step in as an increasingly crowded space of automated “direct” sellers – including isocket, Maxifier, AdSlot and others - look to mediate, if not replace, parts of direct sales with technology.
AdExchanger spoke to Pereira about his company and industry trends. Shiny ads has announced deals with PubMatic (release) and Internet Brands (release) for the company’s self-serve ad platform in the past few months.
AdExchanger: Why is programmatic “premium” or direct needed?
ROY PEREIRA: There continues to be inefficiencies in the “premium” buying processes - there are many steps involved in buying one ad campaign, and it’s also a non-real-time event. We’re all used to buying campaigns now in real-time; direct sales is definitely not real-time.
It’s not just the salesperson, it’s also the finance person that has to get involved and then the ad operations person. When we talk to our customers, they tell us at least 50% of the cost is associated with ad operations, and that’s just the actual buying of the campaign. There’s also creative collection, so you’re trying to get the creative from the advertiser at the 11th hour, and then obviously they are going to want to change that creative when the campaign is active.
So there are a bunch of steps involved here, and there hasn’t been any optimization of those steps to remove the inefficiencies, so the problem with the publishers is that they are finding that they are paying too much in terms of their cost to take these orders.
How do you define the “premium” inventory that will be a part of Shiny Ads system?
I think the lines really blur between “premium” and remnant. We need a better definition there. But when you look at how our large digital publisher customers use our tools, it’s actually to sell rate card inventory exactly like what their direct salespeople are doing. You don’t want your salespeople selling $10,000 or $20,000 campaigns all day, you want them to focus on higher-value sales, so those smaller sales are perfect for a programmatic self-serve solution.
And it doesn’t mean that the salesperson does not receive that compensation. There are huge teams of salespeople who have been used to selling some of the smaller ad buys, so they still need to be compensated somehow.
Where does data fit in with your platform – as in appending data?
Our ad server is the publisher’s ad server. We don’t have our own ad server, we don’t have an ad tag. We interface with the ad server of the publisher directly via the API of that ad server, and we support eight top publisher ad servers.
What that allows us to do is not burden the ad ops person by tieing in directly with the ad server and their functionality, so targeting, inventory forecasting, monitoring, all of that can be done in real-time. The reason I mention that is because whatever data they have that is plugging into their ad server, we can use on our platform and make that available either to the publisher to present as a product, or allow the advertiser to select whenever they are buying one of those products.
Can you talk the most popular use case for your platform?
There are two categories that this technology works well for. The publishers that have niche content, have a lot of good conversions – there are a lot of advertisers that want to buy on that site. The other side is publishers that have local content. That seems to work very well.
Why work with a sell-side platform (SSP) such as PubMatic - should we expect more relationships like that from Shiny Ads?
Pubmatic is an SSP, they have real-time bidding (RTB) technology. They also target a lot of the same type of customers that we do, which is the ComScore Top 1000 “premium” publishers, and so there’s a nice synergy there. They don’t have a self-serve solution, so their salespeople are selling this solution to their customers.
They do have private marketplaces and RTB, but we don’t find that it overlaps to what we’re doing with the “premium”, guaranteed, Class 1 inventory. Up until this year everyone kind of thought that private marketplaces was probably the “highest” thing that you could do in terms of programmatic, but again with our programmatic guaranteed technology, we can give their customers a level higher than that, which is the class 1 inventory.
How does pricing work for both parties involved - buy and sell side?
We’re obviously just a sell-side company. We are very publisher focused. In fact, the relationships that we’ve built with some of the DSPs are the first demand engagements that we’ve done. We only charge our publishers a percentage of the transactions that flow through our system. It really is based on volume so the higher the volume, the lower the transaction fee. There’s no monthly fees, no setup fees or anything like that. Simple is best.
From the buy-side perspective, you’re simply giving them access to your platform? No revenue model with the buy-side?
We’re not trying to double dip; we’re trying to generate more demand for our publishers through our DSP partners and so we did not feel like it was appropriate for us to charge both parties.
We’re not going out and generating demand. We’re not talking to advertisers to bring them in.
How do you differentiate from some of the other guaranteed programmatic platforms?
We’ve always also focused on the high-end publishers, the ComScore Top 1000, and they demand a different type of solution, so you’ll notice that our solution is completely white-labeled, and that gives the biggest control to the publisher; they get to control their brand, they get to also own the advertiser. We are not trying to build a marketplace. We’re trying to do technology just for the publisher.
Another point of differentiation is that we’ve plugged into ad server APIs and continue to add more add servers -- we support eight of them today. We also support every single piece of targeting available, because that’s very important to the publisher. They all target their sites differently and if you don’t target everything that they support, at some point an ad ops person is going to have to get involved in that transaction and you’ll increase your costs.
Also, we have different web interfaces for different users. We don’t believe that “one size fits all”; we were the first ones to come out with a direct sales interface. Our small advertiser interface is radically different than what we see with some of our competitors in terms of its ease of use, in terms of not using terminology like “CPM,” which you and I understand, but to a smaller advertiser, they probably don’t.
Do you think when publishers’ salespeople read this, they should worry about their jobs?
No, I don’t, and that’s the first thing that a lot of salespeople do think about with automation. They really shouldn’t because this actually makes not only their publisher more revenue, but it could also make them more revenue – they have more time to focus on bigger deals.
And they can still get compensated. There’s a completely transparent audit trail that happens with this that the publisher has access to, so the publisher can make compensation available to the direct salespeople. A good analogy is basically when the ATM machines were coming in and the bank tellers were worried, but when you look at it now, the ATM machines in the bank to take the standard transaction, while the more high-level interactions happen face-to-face with a bank teller - that’s what’s going to happen in the future with direct sales. It has to happen.
Where is Shiny Ads in terms of headcount today?
We’re eight full-time employees today. We are out raising a Series A financing round which will allow us to grow the company in terms of staff.
In the next year, year and a half, what are some milestones you’d like to accomplish?
In 2011, we had just the self-serve interface for smaller advertisers. The entire back-end was completely programmatic but, we weren’t really talking about programmatic “premium” because that was kind of a dirty word. This year we launched other products for agencies with a different, more powerful interface as well as a new product for DSPs and trading desks. For 2013, we are expecting is that the mix of revenue is going to change radically in terms or products. We do expect that the revenue from the DSP and trading desk product to exceed all other products combined, so we do have high expectations for that.