Brian O’Kelley at IAB: How the AdTech Renaissance Will Happen (Part 2 of 2)

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This is Part 2 of a two-part recap of Brian O’Kelley’s speech on the AdTech Renaissance. You can check out Part 1 here!

 

In Part 1, we covered what O’Kelley believes the adtech renaissance will look like. He predicted:

  • Fairer, more efficient transactions between buyers and sellers
  • Native ads that resonate with consumers on a human level
  • More personalized ads for every user, driven by machine learning

 

O’Kelley is predicting that this bright future will benefit everyone — publishers, advertisers, and of course, readers. But how do we actually make the adtech renaissance happen?

The key is a better marketplace

 

According to O’Kelley, the key to the adtech renaissance is a more robust, liquid marketplace. Buyers and sellers need to be able to make fair, mutually beneficial transactions knowing that both sides will uphold their end of the deal. Companies like eBay and Airbnb have created such marketplaces in their respective industries, but we don’t yet have one in advertising.

Four things need to happen for us to create that marketplace:

  1. Reduce friction. Buyers and sellers need to be able to make deals as seamlessly as possible. But that becomes difficult when advertisers don’t know whether or not they’re buying viewable inventory. After all, people need to know what they’re getting for deals to go smoothly. So why aren’t we transacting solely on viewable inventory? We have the technology to make this happen. We just need to push for it to become the industry standard. It helps both sides – while publishers may lose the ability to sell some non-viewable inventory, the value of their viewable inventory will skyrocket.
  2. Connect buyers and sellers. Adtech also needs to create a more direct path between the buyers and sellers best suited to one another. One way to do that is to enable publishers – particularly niche ones – to set up deals and private marketplaces with the advertisers who make the most sense for them.
  3. Better pricing. Right now, between all the different intermediaries, total take rates can be 30-50% per impression. That’s way too high – technology is supposed to make services cheaper by eliminating middlemen, right? O’Kelley believes were going to see that soon in adtech, and that take rates will drop to 10% total across all providers.
  4. Bring back the trust. Trust is the key to an open marketplace. And to establish trust, all the market players need to act fairly. This means discouraging bad practices like allowing certain networks last-look bidding privileges or setting unfair price floors as a publisher.

 

O’Kelley believes these changes can improve the Internet for publishers, advertisers, and users alike. And while they’re big changes, he doesn’t believe they’re out of reach. In most cases, it’s a matter of buyers and sellers simply demanding more out of the companies they partner with.

 

Want to learn how AppNexus has already moved the marketplace in the right direction? Click here to download our white paper.


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