Real-Time With Sizmek's Caprio On Buy-Side Dynamics In RTB

Sizmek, an ad management platform, has made a number of moves in recent months to position itself for a programmatic future, including the launch of a team of RTB specialists to help buyers shift budgets.

Real-Time Daily caught up with Mike Caprio, GM of the new RTB team (called Sizmek Vantage), to talk about the company’s recent moves, including which players on the buy-side are using the Vantage group (and how they are using it). After all, the “buy-side” is comprised of brands, agencies, trading desks (both independent and agency-owned) and DSPs, all of which either buy in-house or via managed services. Caprio also touches on this fragmented market and how brands are taking more ownership.

Real-Time Daily: Sizmek has beefed up its media measurement and video offering in recent months with partnerships with Nielsen and comScore, the launch of a video verification tool, etc. Let’s start with media measurement -- had digital marketers been doing it all wrong? What has changed in the past six months to make “media measurement” such a hot topic?

Mike Caprio: I don’t think digital marketers have been doing it wrong at all. If traditional media buyers had the same data at their disposal they would undoubtedly leverage it. Also critical is video verification … which reduces the brand safety and visibility risk that can come with migrating dollars from TV to digital video. One of the reasons this is critical is that there is only a limited pool of quality video inventory available. And when you move to that next tier of inventory quality, things like player size and surrounding content can become questionable.

Either way, as more and more dollars are moving online, agencies, brands and publishers are looking for ways to easily compare apples and trucks. That’s a big reason that cross-media measurement has been, and will continue to be, a hot topic in our space.

RTD: Now on to video. Are you of the belief that digital video is the gate through which TV dollars will come online?

Caprio: The reality is that video is video and consumers do not distinguish between their screens any longer -- why should advertisers? If you compound this with the fact that television commands the largest pool of branding dollars and eGRPs have made the point of comparison fairly straightforward between television and digital video, it’s the biggest opportunity for a transformation in how budgets are allocated. But the reality is that the largest TV players, including Disney, Fox, Comcast, Viacom and CBS, are also huge digital publishers and have been repackaging and leveraging online all aspects of their inventory for some time. 

RTD: What role does programmatic play in that shift (from TV dollars to digital dollars)?

Caprio: Having bought and sold TV in the past, I try to define the digital landscape in a way that TV people and many brands can relate to. TV has been bought and sold as part of two primary markets for nearly two generations -- the upfront market and the scatter market.

The upfront market includes all the pomp and circumstance of pitching new pilots to agencies and their brands and securing dollar commitments up front for inventory throughout the broadcast year. The scatter market is for the remaining inventory and is bought and sold based on supply and demand.

I see programmatic for video -- and other mediums -- in the same way. I believe there will continue to be private market (i.e., upfront-type) deals, and then RTB open market (scatter) deals. You are starting to see these private marketplaces forming now with FreeWheel and others. But I think the biggest driver will be with dollars earmarked for the scatter TV markets that can be more efficiently targeted within online RTB.

Mobile is another key area that is poised to siphon dollars away from local TV and cable -- particularly with local automotive and retail. Geotargeting and audience retargeting in mobile is still not bulletproof, but sits on the horizon as a major disruptor to local TV. RTB provides a great opportunity to target and execute these campaigns with minimal waste.

RTD: The Sizmek Vantage group was created to help “agencies, brands and trading desks” with real-time bidding (RTB). Which one of those three has Vantage worked most closely with? Why do you think that is?

Caprio: Today, most of our Vantage business comes from our managed service trading desk, and our clients are mostly media agencies. (Other offers include consulting and data solutions.)

The separation between media agencies and trading desks has created a knowledge and execution gap, and agencies [sometimes] want to execute programmatic independent of their own holding company trading desk for any number of reasons.

In certain cases clients don’t want agencies to use their holding company trading desk and need to resolve that conflict of interest. In other cases, the holding company trading desk or direct deal with the DSP didn’t work as they hoped. 

RTD: Is there still a set “model” for the buy-side? Brands to Agencies to Trading Desks to DSPs is the LUMAscape version. What has happened to that model? Or is it still intact?

Caprio: There are still buyers and sellers; that much hasn’t changed. But everything else in between continues to evolve and quickly.

Brands are taking more ownership of data -- and as that continues they will begin to take more responsibility for direct audience communication and attribution.

The holding company trading desks continue to grow in size, but so does the controversy around their opaque models. Publishers are continuing to release more premium inventory but are looking for ways to preserve their differentiation and audience value. Agencies are looking for ways to ensure they retain their control in a programmatic world.

The good news is that with more and more data driven decision making -- alongside excellence in creative storytelling -- campaigns will become more effective, will be delivered more efficiently and better appreciated by consumers.

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