Brian Tomasette continues to have some nice posts on his blog. His most recent discusses how it is possible to wire together DFP to work like an ad network technology stack. In fact, he points out, Collective Media uses it this way. (or used it this way.)
Couple of thoughts:
- Love that Brian is willing to put it all out there like this. Maybe he doesn’t view it this way, but I view this as a pretty good knock on Collective Media (more on that in a second). When I was an AOL employee, I tried to be pretty restrained in bashing competitors (although I am sure some would disagree). It is very tough for Brian to be a sales guy at AOL and make fun of Collective. But telling the truth is, at some level, never wrong…. it is just not PC. And really interesting!
- Lot’s of ad networks are doing this. I mean a lot. If you and I started an ad network tomorrow, we would probably do this. If Brian started a network tomorrow, he would do this. Great optimization only comes if you have the liquidity to have things to optimize off of. So the focus of every small network is signing up publishers and advertisers. It is rarely the algorithm. The result is that people get just enough technology to get by. Essentially, you fix your technology costs as a percentage of revenue when you use this. It isn’t necessarily great tech, but it would take a few people a bit of time to do better. Most people say, “why bother?” One of the main reasons that DMX was shut down by Right Media, in my opinion, is that people were simply using it to run tiny ad networks and, given that most of the inventory was just more frequency from the same publishers and more CPA ads from the same advertisers, they were not adding a lot of value. This is the “not premium” that Yahoo was complaining about.
- The advent of exchanges has made this even more popular. Now we don’t need to front the inventory to run a tiny ad network and we barely need to optimize to go out and sell retargeting. All you need is an account on DoubleClick or Right Media’s exchange and you can start selling network services. But all this inventory is the same! Zero value has been added, it is just more sales people selling the same inventory. And CPA advertisers don’t particularly care, although as they allow varying frequencies of inventory to be inundated with tiny advertisers, they lower the eCPA for the big guys, potentially hamstringing campaigns. This is why the really big guys are a little careful about this stuff.
When a new network calls you, do some diligence. Take their tags. Look at ’em. Are they Right Media tags with a cname? Do a traceroute. Look at cookies they set. This isn’t hard and doesn’t take a lot of time.
There are tons of people starting ad networks. Generally, those people aren’t engineers, they are ad network sales people. Are they really building something unique or are they cherry picking inventory off of exchanges?
UPDATE: Let us be clear, I mis-characterize Brian as making fun of Collective in this post. All he actually does is state the fact that at one time they used a third party’s tech stack for optimization technology without rendering any opinion regarding the decision to do that. As Brian remarks in the comments, he respects Collective Media.