Think BR: Why the ad tech sector must get better at speaking the language of marketers

At the end of 2012, we look back on a year in which real-time bidding (RTB) and the general understanding of its concepts and benefits really started to emerge from the shadows. The Financial Times estimates that the RTB industry is currently worth $4billion globally, but in many ways, it remains one of the advertising industry’s best kept secrets.

For those creating RTB platform technology, the shift in their target audience from the highly tech-savvy IT department to a broader cross-section of marketers has meant that a recalibration of language and sales approach is necessary to ensure a wider understanding of the benefits. And we still have a way to go in 2013 to build upon the process of shifting perceptions of RTB to reflect an accessible and recognisably useful tool at all levels of an advertiser’s organisation.

Real time bidding works in a manner loosely akin to the way stocks and shares are traded electronically on the international markets. Bolstering RTB’s worth in the world of advertising metrics is the use of - and understanding of - large amounts of data, transforming the way both agencies and marketers make decisions about target audiences and how they can more effectively spend digital media budgets.

The advertising industry luminary David Ogilvy once counselled that "if you’re trying to persuade people to do something, or buy something, it seems to me you should use their language, the language they use every day, the language they think."

Although brands are increasingly realising and reaping the benefits of real-time media buying as our sector of the industry moves into the marketing mainstream, the task in front of leading companies, including us at Turn, is to cut through the jargon and continue to make RTB a valuable proposition for any marketer, regardless of technical ability.

In a nutshell, brands can attain better efficiency of budget by using real time bidding tactics. Instead of assigning an arbitrary value to a number of impressions, each impression is evaluated based on a series of pre-defined criteria specific to each advertiser and the successful auction price is based on market demand. For example, a women’s fashion retailer looking to increase customer acquisition and drive effective awareness recently used Turn’s platform to double the campaign reach and improve eCPA performance by over 45%.

In just 10 milliseconds, Turn’s system notifies when an individual screen advertising impression is available via an auction "exchange". It then evaluates which brands the impression is relevant to, measuring against up to 2000 data variables and then calculates how much the impression (and the customer viewing that impression) is worth to that advertiser. Once a bid is successful, the software determines which creative ad is to be shown and returns the name of the advertiser, the URL creative and price the brand is willing to bid.

Every demand side platform is given 50 milliseconds to respond and the winning bid from any authorised platform serves the ad. With RTB technology powering a vast number of interactions in milliseconds, this type of trackable approach is fast-becoming a fundamentally important tool in the modern marketing armoury. Yet as a sector, the automated ad trading industry needs to get better at speaking the language of advertisers and to excite clients with how our technology can attract more customers to brands, rather than getting sidetracked by the technical granularity of media buying.

A dashboard such as Turn’s also offers a data management and analytics system that enables clients like insurers or car companies to identify common details among their best customer segments and then extend the reach of a campaign by bidding to show ads to people who resemble those high value customers. The machine learning process gets better at pinpointing ideal audiences over the course of the campaign, increasing efficiencies and ensuring "best fit" for a specific brand’s products.

One of the major strings to the ad tech industry’s bow when it comes to "talking the talk" is that an effective media planning platform is increasingly seen as essential because it demonstrates that the added revenue generated by using performance marketing techniques is indispensable.

Only when ad tech companies start talking in terms of how results affect bottom line sales, will brands fully embrace the possibilities that automated trading, combined with data management, can deliver.

Pierre Naggar, EU managing director, Turn