Since many in advertising and marketing love to compare our industry to -- and strive to model our platforms after -- the financial business, let's explore the similarities of both in terms of customer service. In advertising, we typically refer to service levels as “Self” or “Managed” yet I submit that platforms from both industries cater to three different types of clients and there should exist three equally defined service levels: “Self-Service”, “Managed” and “Full-Service”. Here’s why.
What is Full-Service?
Traditionally, Full-Service solutions have been where the bulk of advertising budgets have been spent on TV. Just as hedge funds manage the wealthiest investor’s budgets, so too are the biggest advertising expenditures expertly managed by big advertising agencies. The extremely wealthy don’t gamble; they want sure things and forecastable returns and big firms like Merrill Lynch, Goldman Sachs and Morgan Stanley charge significant fees to handle their portfolios with little direction from their clients.
Full-Service Might Prefer Self-Service
In both the advertising and financial industries, Self-Service platforms are generally aimed at individuals who are very sophisticated on one end of the spectrum and novices on the other. The expert day trader can use a Self-Service like Interactive Broker with little to no need for support. They are fluent in buying protocols like stops and limit orders, futures and options and can draw and interpret stochastics. They invest their own funds and many have even built their own algorithms giving them buy and sell signals based on their own proprietary interpretation of data. Interactive Brokers Group has some of the lowest per trade fees on the market because little to no human support is needed.
As a comparison, agency trading desks and in-house buying units using DoubleClick or AppNexus to buy digital display pay only a small percentage technology fee for their usage. This is because traders are not only well-versed in RTB protocols, but because ad units are standardized, supply is abundant and campaigns are more performance oriented. In other words, it’s relatively easy to buy digital display through programmatic platforms if you know what you’re doing. Proprietary DMPs exists to provide buy signals and DSPs can draw telling price to volume curves. On the supply side, algorithms tell publishers when to sell and at what amount. For some aspects of media buying, using a self-service platform can make good financial sense if you don’t need any support or advice, like those at sophisticated trading desks.
Self-Service Might Prefer Full-Service
For smaller businesses or the individual marketer -- i.e. the novices -- who wish to promote a commercial, product demo, or branded content they may not have the resources to sign a Big Six holding company agency to handle their media buying. This also includes the hundreds of independent media agencies, creative and PR shops that are increasingly activating paid media campaigns. While they may be reasonably literate in buying protocols, they don’t have the time to watch every aspect of how their campaign is performing. Self-service platforms have provided a real democratization of programmatic for these types of customers. However, without regular direction, advice and support, the novice can become frustrated when performance doesn’t meet expectations. These types of buyers should look to more managed solutions.
The Need for Managed Service
Today’s investor is smarter and more empowered than ever, so is today’s media buyer. Those using Full-Service solutions may want to explore aspects of Self-Service without being completely on their own. Likewise, those aspiring traders that might not be able to afford Full-Service solutions may seek greater hand holding then a complete Self-Service platform.
As the needs for simplicity, greater transparency and performance grow, I think we need to build a new category of customers now more correctly defined as “Managed Service” to sit in the middle of the spectrum.
Managed Service gives the user access to every step of a media buy: from pre-planning to activation, reporting and reconciliation. With Managed Service, investment advice should be available before you make that buy. Inventory and pricing should be transparent and reporting systems are built to cut performance data a multitude of ways. Managed is just that; it’s under management, but users are afforded all aspects of Self-Service if they so choose to take control of the proverbial wheel or check in on progress and pull a report with an autopilot always at the ready.
In the future, I see many media buyers looking for a more middle ground solution in between Self-Service and Full-Service. Look for platforms that give you access to all the controls their internal traders have, but don’t be so rigid that you need to do everything yourself. The reality is 95% of day traders lose significant money. Don’t be one of them.