"Google represents between 50%-90% of display volume (QPS) being purchased by DSPs, ad networks and agency trading desks on a RTB basis. Incremental QPS volume comes from the SSPs (Admeld, Pubmatic, Rubicon), Microsoft (new to the game via Appnexus), Contextweb, OpenX and a few others."
If your read the above and are thinking WTF?, you are not alone. You need to know though, 'cause change is coming to marketing in a big way. This change is being driven by data, analytics and performance captured by companies such as Annalect, MarketShare, Google and others.
Remember the old advertising quip, "50% of my advertising works, I just don't know which 50%"? Today there is, for the first time, a very real prospect that marketeers will know what 99% of their tactics are delivering, minutiltely and precisely. We are entering a new era of accountability which has profound implications for creativity, instinct, and imagination.
So what is going on? Three factors are converging:
1) Comprehensive Data Across Media
Already the sheer tonnage of data being generated via the digital, social and mobile channels provides marketeers a window into consumers interests and behaviors. Traditional media is also joining the digital data party, with tablet editions of magazines, wired TV set top-boxes, electronic outdoor billboards, digital radio and more all enriching the picture. Throw in actual retail sales, both on and offline, and the host of other data points clients are collecting, and a new end game is in sight - comprehensive, fused and organizable data spanning every waking moment of consumers lives.
2) Audience Tracking
As these streams of data are flowing in, more and more they are matched up to actual people. Yes, that sounds creepy, but for marketeers it is useful. Again, the end game of these improvements in matching media metrics with individuals is the better targeting and relevance of communications - think Tom Cruise in Minority Report.
3) Speed Speed, Speed
RTB, as quoted above, is for 'Real Time Bidding'. Today, Exchanges are completing the 7 or 8 steps necessary to serve a customized ad in under a quarter of a second! Why bother with what happened in post-campaign reports weeks or months after the fact, find out what is happening now! This is the promise of live advertising.
What does all this mean?
Medium term a huge amount of guess work is being removed from the advertising conversation. As an industry, agencies have benefited from the unknowns. We have been inefficient simply because it could never be proved what was working or what was not. In the debate between art and science, art could hold its own as the science was flawed. I see a day soon where the science has the proof needed to refute the intuition of art.
The Death of Creativity?
No, it is not the death of creativity. Models, statistics and past-performance can not predict for the game-changing ideas. However, it is getting closer. The sad truth is the majority of our work is not game-changing. It is incremental and more-of-the-same. In this new era coming, the brute processing power of data is going to offer a better solution than real people most of the time.
Winners and Losers
This sort of depends on how you view things. Media shops are going to lose a lot of media planners and buyers - a lot! In their place will be a smaller number of data-jocks and analytics gurus. So, smarter organizations, but I think much smaller in terms of actual people.
Creative agencies are going to lose more influence and control. A lot of creative is going to become modular, constituent parts that algorithms can meld together instantaneously. There will be less great work overall.
Clients are going to have more productive work. That will be a win for them. They may not have as much fun getting there, but the CFO will not care about that.
Advertising as an industry will win. It will be more credible, more scientific and better received in board rooms. It will probably also be a lot less fun though as well.