Commentary

L'Oreal Gets Hands-On With Programmatic, Inks Deal With TubeMogul

L'Oreal USA this week announced that it has partnered with programmatic ad platform TubeMogul. The beauty brand will manage its U.S. video advertising campaigns using TubeMogul's platform. It's a direct deal between L'Oreal and TubeMogul, signaling another "win" for the in-house movement.

According to Advertising Age’s “Top 200 U.S. Advertisers” report, L’Oreal was the ninth-biggest spender in the U.S. in 2014, dishing out $2.2 billion.

Three weeks ago, after Index Exchange released its Q1 2015 data that showed that more brands are getting hands-on with ad tech, Index Exchange’s Lizzie Komar, director of research and analytics, said to Real-Time Daily that “while many posit this is due to more marketers buying programmatically in-house, we think it’s about the data.” She added: “Own the DSP contract, own the data.”

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That could be what L’Oreal is thinking here. By navigating around other partners and striking a deal directly with TubeMogul, L’Oreal gets a lot closer to the action.

According to a recent survey conducted by MediaSense in associated with ISBA and Ipsos Connect, the majority (54%) of brands expect to bring more ad tech-related functions in-house by 2020.

But what “in-house” looks like could shift. As Komar noted, it could be less about going in-house for the sake of following a trend and more about the ability to get closer to the data. There are other ways to do this.

Clorox, for example, works closely with its agency (AKQA) for programmatic buying. AKQA built out trading desk functionality specifically for brands like Clorox, and gave Clorox full transparency into the data and insights. If Komar’s theory is accurate -- e.g. that brands are more interested in data than actually managing the tech themselves -- then Clorox’s approach is simply another way to meet that end.

Lenovo is a brand that has taken a different approach. In recent months, Lenovo has simply given ultimatums to the media agencies it works with regarding which ad tech companies they must use on behalf of Lenovo.

Even TubeMogul -- which has boasted its self-service offering as a strength (a claim that is backed by earnings releases showing that self-service clients account for about 75% of the spend on its platform) -- sees the different flavors. Landing L’Oreal USA is a major direct-with-brand deal, but another one of TubeMogul’s large clients, Mondelez, still works hand-in-hand with its agency as well as TubeMogul -- not unlike the Clorox-AKQA dynamic.

There are many different ways in which brands are attempting to get closer to ad tech, and the L’Oreal-TubeMogul deal indicates that taking the tech in-house is still a trend worth watching.

2 comments about "L'Oreal Gets Hands-On With Programmatic, Inks Deal With TubeMogul".
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  1. Henry Blaufox from Dragon360, September 11, 2015 at 12:06 p.m.

    Perhaps the safest way for the tech side to safely handle direct brand relationships is to wait for the brands to approach them, with or without agencies in tow. For tech firms reliant on agency business, initiating direct sales calls on brand management could lead to most unpleasant consequences.

  2. jack Brown from BDAI, September 11, 2015 at 4:25 p.m.


    Having a direct relationship with the trading platform is a step in the right direction. But the core issue is the data layer and very few if any are addressing that adequately. Getting closer to your data starts with better market measurement. There are two ways to accomplish this: 1. Spend 500,000 to create an in house algorithmic market measurement division that will take a year or more to fine tune, 2. Partner with an experienced algorithmic market measurement company. By way of example check out The Buckley Group Inc. they offer affordable accurate customer centric real time and aggregated data including a demographic panel, all of which is owned by the brand.

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