• by Joe Mandese  @mp_joemandese, November 7, 2008

Don Epperson (Havas Digital's keynote at OMMA)

Don Epperson, the chief executive of one of Madison Avenue's biggest digital marketing services organizations, Thursday detailed a plan that is transforming the way Havas plans, buys and manages online advertising inventory, making it far more dynamic and much more akin to the way Wall Street's financial markets trade equities, commodities and options. During a keynote at the OMMA Ad Nets conference in New York, Epperson, the global CEO of Havas Digital, outlined a new "virtual brand network" that allows the agency to plan, buy, manage and even reallocate online inventory based on how the value fluctuates for specific advertisers and their brands over time. In effect, he said, Havas was becoming an advertising network.

"We call this an open insertion order," Epperson said, sharing that, "The ad network or publisher won't know the actual brand that's going in here until after the transaction is made."

Havas' new virtual brand network, he acknowledged, further blurs the line between publishers, networks, and other "intermediaries" and data providers that have been racing to organize the ocean of inventory spawned by the explosion of online publishing over the past decade, and to find new ways of creating value for advertisers and publishers alike.

The key to Havas' system, he said, was that the agency and its system are at a unique position between marketers and suppliers that provides them with proprietary insights enabling them to identify the underlying value specific online inventory has for a particular brand, and to monitor how those values might fluctuate over time.

"We still have that special relationship with the client," he explained. "The client still shares with us, all that information about the long-term value of their [customers]."

By leveraging those unique customer insights and coupling them with performance data from publishers, networks and other third parties, Epperson said Havas Digital has been able to create a dynamic online ad trading system that is decoupling audiences from publishing content, and is making user profile and unique cookie data the primary currency, not the tangible inventory that a publisher serves.

"We're starting to think of our job at agencies almost as audience aggregators vs. media planners," Epperson explained.

The heart of Havas Digital's virtual brand network is its powerful Artemis system, a database management and reporting system that has already profiled more than a third of the world's online user population. That database, coupled with proprietary algorithms, has enabled Havas Digital to develop systems that draw on data from other third parties, including clients, publishers, and networks to understand which audiences command the most value at a particular time for specific advertising brands.

Epperson cited an example of two seemingly like-minded Havas clients, financial services brands Fidelity and Citizen Bank, and said that while they might both be chasing the same retirement planning prospect, the precise value of that user to each of those clients might vary over time. Havas Digital's virtual brand network enables the agency to automatically recognize when those valuations shift and seamlessly reallocate the audience from one client to the other.

Epperson implied that the system is still formative and that "we still have a lot to learn," but he ultimately envisioned it evolving into a "futures" marketplace akin to Wall Street's options marketplace or Madison Avenue's network upfront marketplace. Under that scenario, Havas Digital might make buys in January for online inventory that would run in June, and the allocation of that inventory would change as client and audience market conditions alter over time.