The Rise Of The Meta Ad Network

The exchange marketplace is creating the perfect eco-system for specialist traders. Technology and number crunching dominate the new automated media buying age. Among all the great companies building their businesses around the ad exchanges, it is the meta ad networks that are proving to be the most successful.
They are winning large DR budget from advertisers and brands, as their model is built around performance delivery. And they are attracting a lot of money from VCs: this week MediaMath, the New York-based ad trading firm, received funding of $12.5 million dollars from investors.
Meta ad networks are essentially exchange specialists, who buy opportunistically across the different platforms with their own platforms, algorithms and in-house trading expertise. They are data-driven and hire highly numerate people to unbundle the value from user data and ad impressions. This allows them to target the right audience for their client’s CPA campaign.
Meta ad networks do not buy inventory on a particular web site. They do not buy context. They buy audience. They don’t really care if a top-tier site like the FT has a particular demographic of business man, because that same audience can be purchased elsewhere at a fraction of the cost using the Ad Exchanges.
We Are All Meta Ad Networks Now
As exchanges continue to aggregate online ad inventory and publishers begin to trade with buyers, the Ad Networks will find that their traditional brokering role is under threat. Site rep firms will find it difficult to survive in the new automated world. The ad networks that do make it will resemble companies like MediaMath and X+1. They will be data-driven organisations and will buy most of their inventory across the exchanges on behalf of their clients.
Ad networks have the technology and the optimisation expertise to compete with the growing army of exchange specialists. Both now compete in Europe and in the US to get on the media plans for most digital agencies. The ad network model will need to be tweaked a little, but they will still have a lot to offer the advertiser and the publisher.
The Advertiser Taking More Control
What will get really interesting is when advertisers decide to bring their DR media buying in-house – and rumours abound that a few of the big media brands are seriously considering this course of action. You will then have a situation where agencies, meta ad networks and the remaining ad networks will battle it out for budget.
The advertisers that do decide to take their DR spend in-house will still require the help of media buying specialists. Advertisers will set up a media plan, asking all interested parties to pitch for budget. They will cease to pay agencies a fee based on media spend. Instead all fees from DR campaigns will be based on performance. The meta ad networks, built on technology and performance, will prosper in this new environment. Traditional agencies, built essentially to service massive media budgets on behalf of clients, will struggle.
I expect companies who do have big DR budget to be looking at introducing a strategy like this in the coming months. They’ll probably even hire some skilled media planners from the agencies to manage their budget. It would make sense. The lines are becoming ever more blurred in the online advertising space.