We are pleased to welcome Doug Wintz as a monthly contributor to The Makegood. Doug is Founder and Principal of DMW MediaWorks, a consultancy specializing in digital ad operations and technology. Look for his column every third Wednesday on The Makegood.
Depending on your point of view, “Armageddon” could refer to 1) the day in which wicked people are consumed by fire leaving only the righteous to inherit the earth, 2) a time in which nature rebels against humans and takes back the planet or 3) a movie starring Bruce Willis and Liv Tyler.
Of course, if you are media centric, Armageddon could refer to the day in which programmatic buying takes over the media landscape leaving human beings to look for other means of employment. In the article “Here’s Looking At Your Future…” written some time ago, I engaged in some speculative fiction that depicted a media planner/buyer in the process of managing the entire multi-media budget of Ford Motor Company from a console in her home office. (See http://www.imediaconnection.com/content/6982.asp). That piece was set in the year 2020.
Don’t get me wrong, I’m old school and a firm believer in the value and integrity of content whose value is supported by the CPM metric. Publishers must maintain that value through a combination of creative selling, proper workflow and efficient ad operations. But old school or not, it’s hard to ignore the drumbeat of change.
Media Armageddon has been a frequent topic at various industry events these days with panels such as “Inventory in the Age of RTB”, “The Evolving Dynamics of Programmatic Buying/Selling” and “The Next Evolution of Programmatic Buying” – all occurring within the same week’s worth of conferences in New York. That’s a clear indication the end is near.
Or is it?
Clearly there is change. If programmatic buying – meaning buying and placement of ads through software instead of through an interaction between a human seller and buyer – accounts for a relatively small slice of a publisher’s media revenue today, when does that get flipped on its head and account for the majority of revenue? What happens to the media Establishment when that does occur? And, more importantly, what is standing in the way of that reversal of fortune?
From my POV what is standing in the way of a total shift to programmatic buying is the very same media Establishment that will be effected by the trend in automation. Today, every major publisher is armed to the teeth with legions of creative, professional and human sales teams supported by applications like Salesforce. And, there are well staffed ad operations departments with their own slew of applications that support the hand-crafted campaigns that are sold by the sales teams. The balance between automated buying and direct selling has been carefully regulated by publishers in order to avoid channel conflict, to continue to produce revenue and keep sales teams incented do what they do best – call on buyers and planners at ad agencies and close business.
Speaking of ad agencies – there are thousands of planners who provide value to advertising clients by evaluating media properties, negotiating with publishers, and directing the optimization of campaigns. Many agencies have already divested themselves of the job of creating physical ads and rely totally on media planning and buying as a service to clients. If automation takes over and the agency skill of planning and buying goes by the wayside – where’s the value to a client? How many planners will you need to manage the new automated process? My sense (rocket scientist that I am) is that the number is fewer than it is now.
However, until we reach a tipping point, the human factor will continue to moderate the pace of change and automation. Moving the programmatic buying needle for digital media will take longer than people expect – because of people. Unwinding the digital media establishment will take time. When that happens, sellers and buyers will have their jobs redefined for them.
Even so, in the future I think there will always be the need for the creative synergy that relies between a close alliance of marketing and quality content. Sponsorship of the NCAA will always be a hands-on affair. Today, more advanced sponsorships are often handled by “Client Solutions” groups within publishers. In the future, this may be the ONLY group that requires human interaction between marketers and media owners. And a similar, smaller group might exist to handle that same level of creativity on the agency side. Then we could have the scenario of 20% of a publisher’s media revenue is devoted to custom “Client Solutions”, while 80% is handled by programmatic selling/buying.
I used to think 2020 would be the year of Media Armageddon. But because we are human beings, have jobs we are invested in and working for media institutions that have existed for over 100 years – it might be a little further out. We’ll see. I won’t tell you my age, but according to current statistics on the life expectancy of the American male, I should still be alive and kicking in 2020. So mark your calendar, then hit me up and we’ll see how far the needle has swung and how the digital media landscape has been altered.
Doug Wintz is a contributor at The Makegood and Founder and Principal of DMW MediaWorks, a consultancy specializing in digital ad operations and technology.