The only thing that is constant in our business is change. Whether you’ve worked for a start up, or an established publisher, chances are you’ve been at one end of a merger or acquisition. If you’re lucky, the powers that be will have conducted a complete due diligence which would include the impact of this business strategy on the operations end of the business. Too frequently, however, the operational issues are only considered a sidebar and tucked away under the category “we’ll figure that out later”. Of course, this leaves it all up to operations to figure out. Here’s what you need to plan for and manage as all the operational “stuff” hits the fan as a result of merger and acquisitions activity.
Multiple ad servers
There are a couple of potential scenarios as far as ad servers are concerned. If you’re lucky, you will be combining forces with a new company that uses the same branded ad server that you do. Even then, there is work to be done. You still have two instances of an ad server, and to maximize trafficking and reporting efficiency for both the advertisers and your own publishing business, you’ll need to pick one ad server, and set up the site structure to reflect the addition of the new business unit. Before rushing to simply replicate site names from one ad server to another, ask the question “how will we be selling these combined sites moving forward?” The answer might lead you to revise how sites are named, or at least settle on a common naming convention to make trafficking and reporting easier.
The other scenario that may occur is having 2 distinctly different ad servers as a result of the merger of two companies. This means having traffickers with knowledge of dual systems, two different flavors of advertising reports, billing and reconciliation that need to come out of two systems. This is not efficient in the least. So what to do? Take a good look at your new inventory of content and ad units. Is video going to play a key role moving forward? Will performance based campaigns predominate? Will this open up a network strategy for your company? Look at the future needs of your operations group. If you don’t have a contract management system, will you need one in the near future? Do you have a video platform and if so, which ad server does it integrate best with? The answers to all these questions would help inform which ad server may be the best fit in the long term future of your combined companies.
Contract Management
Hopefully, a merger will mean more that just two companies clinging to a life preserver – but instead mean that there will be increased volume of sales activities and contracts. If you are currently using a contract management system, you’ll need to create a project plan to set it up to reflect the new content and ad units. If you don’t already have a contract management system, you’ll need to review the vendors, and pick on that is the best fit for the common ad serving platform you’ve decided on.
What type of contract management system is best for your new mega company? In general, if there is a consistent history of successful integrations between two different applications (like video platform with ad server, reporting suite with ad server, yield management with ad server, etc.) then the door is open to choose from a number of independent contract management companies. However, if there is NO history of successful, well-supported integrations, you are better off sticking with a contract management that comes from the same company that supplies your ad server. You will need to keep it simple, because in this case you have scant resources to fall back on to manage a successful integration.
Campaign Migration
At some point, assuming you combine ad servers, you will need to create a campaign migration plan to move ad campaigns from one ad server to another. This requires project management to insure that this task is accomplished with the right timing, and an acute attention to quality assurance (QA). Is it a good idea to migrate all campaigns in mid December? Probably not. You’re getting to the end of Q4 and any disruption of campaign delivery puts your budget at risk. Additionally, mid-month migrations mean that you’ll need to have 2 sets of reports from each ad server in order to perform month end billing. The solution is to migrate on the 1st of a month – during a quarter when some disruption of campaign management is an acceptable risk, and when you have time to recover should you fall short on delivery.
Of course, the solution to making sure you don’t miss delivery goals is to have a good QA plan in place. Have all line items been transferred from one server to another? Do they reflect the most recent contract revisions? (And may God help you if you don’t have adequate records of contracts.) Are all ads which have been re-booked pacing to contract delivery? Are they registering clicks and ending up on the right destination URLs? These are all crucial elements of QA during migration.
Reports
If you’re fortunate, you work in one of the 2 or 3 internet publishers who have mastered the skill of taking raw data from various applications (ad server, contract management, video platform, site analytics, etc.) and importing it into a reporting suite that supplies an intuitive dashboard for management reporting. For the rest of us, we’re all too familiar with the fire drills that occur when we need to create ad hoc reports on yield management, ad performance by content type, etc. Now imagine trying to cobble together the same from two different companies using different ad servers and reporting systems.
If you going to be in the midst of a merger, why not take the opportunity to re-architect your current reporting system, making it unified and constantly updated with contract and delivery information. This may range from simply aggregating this information from the single ad server you decided on, to pulling delivery / contract data from the API and creating custom reports.
Financial Systems
Last but not least, the financial systems that process billing and create invoices. The merger of two companies creates several decision points. Which legacy financial system should be used? How does the billing file as created by the ad server need to be configured to fit the financial system? Are there new ad units, packages or models that finance needs to be informed of and take into consideration? Are there new applications they will need to be trained on? All of these considerations need to be addressed ASAP – because the combined company’s ability to show increased revenue will depend on it.
You Can Ignore It, But It Won’t Go Away.
The operational issues associated with mergers and acquisitions can be ignored, but they won’t go away. And like any other problem in life, whether it’s medical, marital or political, the longer the issues go unresolved the worse the situation gets. So one of my wishes for 2010 as our financial climate continues to improve, is that for those of use in the midst of change have the charter to manage it in the interests of greater operational efficiencies.
Doug Wintz is principal and founder of DMW MediaWorks www.dmwmediaworks.com and has been working in interactive businesses for 20 years, ranging from Prodigy, to AT&T, Softbank, Uproar and Lycos. In 2004, he started DMW MediaWorks, a consulting company focused on digital media, operations and technology. Recent clients have ranged from traditional media brands such as Turner Broadcasting, A&E, NY Times, MTV, Philadelphia Inquirer and Universal Music, to digital brands like Comscore, Jumpstart, Kosmix, Eons and Local Matters. Doug is a frequent contributor on topics related to ad operations for IMediaConnection, and teaches several seminars for AdMonsters.