I recently attended a panel discussion in New York on media fragmentation consisting of media agency execs including:
- Bant Breen (Interpublic - Initiative -President, Worldwide Digital Communications),
- John Donahue (Omnicom Media Group - Director of BI Analytics and Integration),
- Ed Montes (Havas Digital - Executive Vice President),
- Tim Hanlon (Publicis - Executive Vice President/Ventures for Denuo)
The discussion was kicked off of by Brian Pitz, Principle of Equity Research for Bank of America. Brian set the stage for a spirited discussion regarding the continuing fragmentation of online media along with research on the issues posed by this. The panel discussion touched upon many issues including fear placement around unknown user-generated content, agency lack of skill set to address this medium and lack of standards. However, what surprised me most was the unanimous consensus in opinion that there is more value further out on “The Tail” of the online publisher spectrum due to the targeted nature of the content. Yet the online media buying statistics conflict with this opinion (over 77% of online ad spending is still flowing to the top 10 sites).
When asked “why the contrast?” between their sentiment and the stats, the discussion revealed the level of uncertainty due to a lack of transparency into “The Tail”. Despite the 300+ ad networks that have emerged to address this very challenge, the value chain lacks the data to confidently invest the dollars. In addition, there was a rather cathartic moment when John Donahue professed that agencies should “Take Back Your Data From Those that Hold It Hostage”.
It is our belief that the opinions expressed by the panel serve as evidence of a shift towards a new era in media where evidential data will drive valuation across media rather than sampling-based ratings acting as the currency. No one will be immune from this:
- Agencies need it to confidentially invest their clients dollars and show demonstrable ROI of their services
- Ad networks need it to earn their constituencies’ share of marketing budgets
- Ad networks need it to defend the targeted value and the appropriateness of their collective content
- 3rd Party measurement firms (comScore, Nielsen Online, ValueClick) need it to maintain the value of their objective value
- Advertisers need it to support the logic budget allocation decisions
- BIG MEDIA needs it to defend their 77% stake
You might be thinking, “The need for data is no great epiphany”. However, I submit that the amount of data and the mere fact that all participants should have their own copy is a shift in thinking. Gone are the days where:
- The value chain is driven solely by 3rd Party’s and their audience samples
- Ad Servers/Ad Networks are the only keepers of the data
- Service Providers can offer data for a fee