The geeks in media agencies and media owners have had the last laugh. Jay Sears, Rubicon Project's senior vice president of marketplace development told AdNews they will soon be running the show.
Rubicon Project went public last month and posted its first quarterly results today. The firm posted a loss, and expects to Do the same for the full year. But it has some big customers including News Corp on its books. Despite ad tech firms piling into Australia and vendors vying to tie-up investor cash as the market becomes increasingly crowded, Sears isn't too worried.
He points out that Rubicon has been in Sydney since 2009. “It's crowded maybe in terms of other smaller start-ups. There is a lot of opportunity for leapfrogging, so it's a very exciting time. A lot of companies are investing and stepping up.”
The effect of automation within media is forcing both media owners and agencies to change their structures.
“We're seeing very interesting moves in media companies and agencies – organisational changes to take advantage [of programmatic]. Previously the people running that were the kids that had their lunch thrown at them [at school]. But geeks always have the last laugh. That organisational change is happening.”
With agency models under pressure, Sears said that holding company bosses have seen the numbers coming out of the trading desks and are working out how to apply automation to the rest of the business. “They are going on a diet plan. They are dealing with two or three thousand media owners globally. They want to make it two hundred.”
That has brought the automation people to “the top table” and has “transformed upfront trading agreements.”
Some agencies will “take a hub and spoke model leaving the strategy component within operations... but if something can be automated, that will happen in the hub. Others talk about the embedded model – putting automation specialists as close as they can to planning.” Either way, said Sears, “automation is moving from an afterthought to first thought.”
That creates a talent crunch, as the types of people both media agencies and owners need continues to change.
The skills crunch may ease over time, but for now, there has been a lot of recent churn within Australia's largest publishers.
But publishers have a big opportunity to make money from programmatic and are gearing themselves up to take advantage, said Sears, and programmatic direct - where publishers and brands or agencies can set up private deals and use technology to automate trades – is set to drive growth.
“Publishers will take a data management platform (DMP) and bundle unique media access and first party data and sell directly to advertisers. Direct buying and selling is a much bigger market … it makes sense to take sense to take advantage of it.”
Sears suggested that Australia is at the forefront of programmatic direct, rivaling markets such as the US, UK and France.
“So you will see more and more of that and the changes in holding company structures will only cause that to accelerate,” he said.
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