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Last Week In Adops #02
a weekly email mocking the bullshit that is the adtech industry. sent out every friday so you have something to do while drinking that first beer/coffee (I don’t judge).
Amazon Surges In The Crowded DSP Space
Amazon is now the most used DSP by marketers according to a recent industry survey. This is noteworthy because just two years ago they weren’t even on the list… now they’re bigger than Google. Amazon also edged out AppNexus as the DSP marketers most preferred to use. They did this apparently by making big inroads with any marketer who sells on amazon (I know, this is advanced stuff, try to keep up).
Ad Giants Hear Amazon-Sized Footsteps
A pretty good write up on Amazons moves in the ad space and what it could mean for the $200b digital ads ecosystem.
I know a lot of smart people are very bullish on Amazon in the ad space but honestly, I can’t tell if this is the next AWS for them or if they’re content standing pat. Morgan Stanley estimates they’ll do $5b in ad revenue in 2018 and up to $7b in 2020. Which would give them 4% market share, or half of Youtube. So that’s not nothing… but it’s no where near Facebook or Google. Prime video aside they’re not a media company and they don’t rely on ad revenue to keep the lights on. Their foray into S2S is interesting but it could also just be a way to give them more access to demand. I could see them being a threat to agencies of CPGs but the agency business is high touch, not very amazon-esque. So who does have the most vulnerable margins in this industry that fits Amazon’s M.O.? I’m guessing it’s 3p ad servers, trade desks, and verification/measurement vendors… in that order. Technical, low margin, and lacking in major tech advancements (I’m sure plenty of people want to argue with me on that last part).
Important But Not Relevant
Neither of these things have much to do with adtech but I’d be remiss if I didn’t mention them in my advertising newsletter. The big news is around 56 advertisers (as of this writing) pulling their ads from the Bill O’Reilly show, and Pepsi pulling their Kendall Jenner ad after they became the last people to realize it’s tone-deafness. I think Axios hits the nail on the head here pointing out how brands are becoming the new media enforcers. No it’s not groundbreaking or brand new but it does show the power brands have if they act together and demand something. Honestly I hope we see more of this, even if it does eventually make my job harder.
Google Removes Its ‘Last-Look’ Auction Advantage
Google announces that it has changed how AdX competes within EBDA. Prior to this change the partners in EBDA would submit their bids and AdX would wait until it saw everyone’s bids to decide if they wanted to outbid the highest bidder (it’s called having last look). Now AdX will apparently submit it’s bid just like any of the other partners removing their last look advantage. So that part is clear.
Ryan’s take: Obviously this week’s BFD. So this took me a while to understand and thanks to the person who I promised I wouldn’t quote (nice people rock, smart and nice people doubly so). So essentially this means that EBDA + AdX will have a mini-competition with each other for the rights to compete via EDA with your other DFP lines. What’s most interesting about this move to me (beyond the fact that google is playing fair) is that strategically this means pubs will still want to keep as many of their HB partners on the client side as they can in order to keep pressure on AdX and their EBDA lines. Honestly I have no idea what this does to publishers yield but I don’t love the fact that in EBDA everyone is submitting their clearing price instead of 1P and 2P and then holding the auction at the end. But… baby steps.
A ‘valuation built on a house of cards’
A former employee (the former head of growth at facebook for what it’s worth) is alleging that Snap lied about it’s user metrics ahead of it’s IPO.
Normally I wouldn’t give much credence to this sort of thing but something about the details here don’t paint the normal jilted ex-employee narrative. The guy was poached from Facebook and fired 3 weeks later. Think of any job you’ve had. What would it take for you to get fired in week 3? As of right now I’m still assuming it’s false, but keep a close eye on this one.
Google Training Ad Placement Computers to Be Offended
Google is trying to write code using machine learning and other technical gobbledygook to use context and other things to better filter out bad content from good content on Youtube.
Ok so obviously Google is going to put out some sort of think piece about the great technical work they’re investing in improving content filtering. Blah blah. That’s not the interesting part of this article. To me its buried all the way in the 13th paragraph. That’s where Keith Weed, CMO of Unilever, explains why they didn’t pull their ads from YT. In part because it was a relatively small problem (not many ads shown on not many videos when you view their buying as a whole) but also and I’m guessing mainly because he realized this gave him leverage to demand Google allow third party verification tags. Just two days later Google announced a deal with comScore to provide brands with third party brand safety verification for their YouTube buys. That Weed guy is pretty smart if you ask me.
Snap just launched an attack on a key source of Facebook’s ad revenue
Snap is targeting app install buyers in it’s latest move. Using machine learning (becoming my least favorite word in our industry) they’re allowing app install buyers to target, wait for it, people they think will install the apps. They’re also opening targeting to all advertisers so they can target users that’ve interacted with their ads/filters/stickers in the past.
The last part just seems like common sense and I’m not sure how much that’s going to move the needle. The first part feels like really a smart move. If my memory serves me correct it was app install buyers that really started to pump money into Facebook’s ads ecosystem. It allows Snap to learn about more advanced ad targeting and techniques but limiting the investment required by only going after a small (but lucrative) portion of the online ad market.
Brands Need To Fire Adtech
Doc Searls wrote a bunch of stuff about how bad adtech is and amazingly it got a bit of traction. What’s even more amazing to me is how blithely he discusses adtech’s sins without ever having actually worked in or with it. I took the time to read his lengthy linkedin and the about section of his blog (so you don’t have to) and the best I can guess is he stopped working in advertising in 1998.
If you want a hate read, this is it. Notice how intensely rose-colored his “advertising” glasses are vs. the Hexxus that is adtech mucking up our saintly internet. I don’t have the time or the amount of jameson handy necessary to issue a full takedown but I think this 2015 Rick Webb article from a brand marketers point of view (worth noting Rick has actually worked in/around adtech) is a bit closer to the truth of what brands think of adtech and the faults of our ecosystem.
The Web Looks Like Shit
Purple background. White type. Weird squiggles.
Adexchanger blocked me on twitter. Really? I mean… really?!? I wasn’t even mean to them. Ask Operative what mean feels like. And those guys were GREAT sports about it, I think they tried to give me some swag just for showing up.
Shameless Self Promotion
Happens In Adops Podcast Ep 04 // Andrew Casale (Index) & MSG
This week the tables get turned on me as Andrew Casale and Matthew Scott Goldstein start interviewing me. We also get a bit macro and talk about industry trends, why consolidation is a very likely result of said trends, and we analyze some stocks for you. Plus I grill Andrew about his drink choice.
This Week’s Gif I Can’t Think Of A Caption
My blog is in dire need of more Adam West
Thanks for reading and have a great week! Or don’t. I’m not the boss of you.