The State of Digital Advertising Today [Garrett Gan - Thalamus]
Last month (December 2015), Website Magazine profiled Thalamus, a Web-based service that provides data about the online advertising and publisher market.
WM asked Thalamus founder Garrett Gan a few questions about what he thinks of the state of the market today, the present challenges and available opportunities.
+ As you see it, what is the state of the digital advertising landscape? Strong, weak, static?
Strong. Unless there is some major crash in the market (due to rising Fed interest rates, and as a corollary, a contraction in the economy) then digital advertising will only continue to grow. Even if there is a bump in the economy, this could mean more dollars flowing toward the more trackable and measurable mediums of digital and mobile advertising.
Digital and mobile advertising will only increase in the coming years as behaviors continue to shift from content consumption on analog channels (print, magazine, even TV) to desktop and mobile devices.
+ What specific challenges and opportunities exist for advertisers and publishers in today’s market?
There are many challenges that advertisers face in digital advertising. Firstly, it's fragmentation of the marketplace. There is such a glut of vendors, with ever-changing capabilities, contacts, reach numbers and ad units, that it is virtually impossible to keep up.
Secondly, there is still the hurdle of attribution and knowing how to properly credit advertising vendors for their impact on an eventual user conversion, or lower-funnel KPI. There are a few companies like C3 Metrics and Convertro (owned by AOL/Verizon) trying to solve for this but unless there is a company with true optics into the entire user journey from all website visits to eventual search with product purchase intent, attribution modeling will still be an educated guess, at best.
Thirdly for challenges, Ad Block usage will continue to rise and publishers will be forced to adopt native advertising practices with sponsored posts or promoted content on their websites. This way, ad blockers will only be able to block low-quality banner ads that probably wouldn't have added any significant value to the user's experience anyway.
The opportunities that arise from these challenges are that increased fragmentation forces ad vendors to specialize, and to focus on a core competency in order to survive, therefore providing more unique value to the advertiser (however they may have more points of contact with increased vendors to work with). Also, native ad units will enable publishers to re-establish a harmonious balance of value exchange with their audience, as they will be compelled to serve only high-value, high-impact ads that are not as disruptive to the user experience.
+ What should advertisers look for in an ad partner?
I think a key thing that is often overlooked is the competency of your account manager. Having a good account manager/campaign optimization manager is crucial when trying to maximize the efficiency and conversion output of a campaign.
With a good AM, a client can be more at ease knowing that they have an experienced advocate ensuring that their campaign is running smoothly (pacing for impressions, conversions and ad spend) and being optimized to reach their target goal.
Another key thing to look for in an ad partner is a specialization in your category, geography or a specific type of execution you are looking to run. With the sheer multitude of vendors out there now, ad companies are starting to specialize. In the future, there will be 3-5 go-to vendors that will be top of mind for each category/execution type (e.g. Gourmet Ads for Food Advertising, Drawbridge for Cross-Device Targeting)
+ What makes for an appealing publisher? User Traffic? Content Quality? A Combination? The most appealing thing about working with the publisher directly is the ability to serve high-impact creative units within a known context. User traffic is definitely of importance, and the distribution of traffic sources are a must-ask for your media sales representative (whether users come from direct/search/social channels, or were bought through content recommendation platforms like Taboola and Outbrain).
Content quality I'd say is at the top of the list as the brand affinity (even if not measurable) one gains from running on a premium, well-designed or high-quality content site is exponentially more valuable than reaching people at scale on many low-quality content sites.
+ How does an offering like Thalamus provide advertisers and publishers support?
Thalamus helps advertisers make sense of the confusing and byzantine ad landscape. It allows advertisers, including brand advertisers and agency media planners, to source, evaluate and connect with all the relevant advertising partners matched to their search and filter selections.
Publishers are able to input all their advertising information for free, and receive free inbound inquiries from potential advertisers.