Programmatic Direct Sales Pick Up Steam
So much of the confusion and concern over the hot topic of programmatic premium stems from equating real-time bidding and programmatic buying. Let's put it out there for what undoubtedly won't be the last time: the former is a subset of the latter. Still, that doesn't stop overactive imaginations from picturing programmatic premium as high-quality publishers gleefully slashing their direct sales teams and dumping their homepage inventory into ad exchanges.
Talk about an appropriate horror film scenario, if the business of digital advertising wasn't frightening enough. (Don't open that door – there's a vendor behind it!) But why would publishers ever surrender the somewhat steady revenue of direct sales to the diminishing CPMs they seem to get from selling remnant through RTB? They wouldn't – programmatic premium is a much more complicated beast that seeks to improve on the limitations of RTB.
As a future AdMonsters report will detail, there are several paths to this supposed mecca, with the auction-based model being only one form of real-time, programmatic buying – and in its current form not the most popular one. If two recent pieces of news are to be believed, the rising tide is with programmatic direct sales. Yesterday isocket announced an $8 million investment in its direct sales platform while last week AdSlot launched its Publisher platform in North America and Europe.
The process of selling and executing direct digital sales is infamous for laboriousness and inefficiency. Programmatic direct sales enablers like isocket and AdSlot aim not to eliminate sales teams, but make the process more fluid by automating the most menial aspects. Since publishers pick and choose which ads they accept, client relationships are still of the utmost importance – arguably they're an even higher priority.
Foundry Group led isocket's $8 million Series A round of funding, which coincided with the company's launch of BuyAds Pro, a buy side tool for end-to-end media buying at scale. The company claims this new "point-and-shoot" experience for media buyers can take care of in minutes ad buys that previously required days of manual labor and an average of $41,000 in overhead costs.
"I have said before that I think we’ll look back at 2012 as a key year where programmatic direct advertising really began to take hold thanks in no small part to the efforts of (CEO and Founder) John Ramey and the isocket team," said Seth Levine, Managing Director of Foundry Group and new isocket board member. "isocket has a unique and refreshing vision for how to drive real progress in the online ad industry. While a large amount of time, energy, and investment has gone into taking friction out remnant inventory, very little focus has been paid to applying modern technology to the premium side of the display ecosystem. Direct ad sales should be easier and more fluid – and as a result more profitable for both publishers and advertisers – than existing tools allow for."
isocket boasts a client base of more than 1,500 publishers, including big names like AOL (its first client was TechCrunch, pre-acquisition) Reuters and Gawker.
AdSlot hopes to bring the same success its had on the international front with publishers such as real-estate.com.au, carsales.com.au and SELoger.com to North America. The company is launching on these shores with sites such as WorthPoint and UInterview. AdSlot comes to you from the same minds behind trafficking wunderkind Hitwise, Adrian Giles and Andrew Barlow.
"We're excited to work with Adslot to scale our direct ad sales, reduce operational costs and make our premium inventory available to more advertisers," said Erik Meers, founder and CEO of UInterview. "Their technology was simple to set up and integrates seamlessly with our sales team's current processes."
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Gavin Dunaway is Editor, US for AdMonsters’ Content Team. Previously he served as Senior Editor for interactive advertising trade news depot Adotas.com, and before that he held reporting and editing roles for numerous industry-related publications. When not diligently producing news and feature articles related to ad ops, he enjoys playing guitar so loud that the walls shake.