Epic Marketplace (www.epicmarketplace.com), one of the world’s leading integrated multichannel digital marketing solutions providers leveraging the social media, mobile, display, and video channels, announced today the completion of its migration to a comprehensive new cross-channel ad serving Platform. The new Platform provides for a seamless integration between all of Epic Marketplace’s distribution channels, and the ability to acquire inventory on either a real-time bidding (RTB) or direct basis, all with a universal frequency cap. An enhanced attribution analytics engine is a key component of the new Platform.

The new Platform represents a substantial transformation of the Epic Marketplace ad serving paradigm. Among the changes, the company has decommissioned its segment verification program, which was a component of its legacy ad server. The new Platform was architected and built with an enhanced suite of consumer privacy protections, positioning the company to further enhance its world-class status as a leader in digital marketing consumer protection best practices.

The new Epic Marketplace Platform is driven by a proprietary Optimization Engine (OE) that is built around advanced polynomial statistical analysis. The OE, as the “brain” of the new platform, is data-type agnostic and analyzes data input on a non-PII basis from multiple sources – e.g., social media data, cookie data, mobile data – and then renders targeting solutions applicable across all of Epic’s distribution channels. Among the critical targeting solution sets are strong core competencies in audience aggregation, keyword bidding and contextual analytics, the latter via a real time semantic contextual engine.

“This new Platform is a culmination of a vision we set forth several years ago,” said Don Mathis, President and CEO of Epic Marketplace. “With its launch, we are fully positioned for the next five years of growth in our sector – which will be all about the integrated campaign and the opportunity to provide our clients with cross-channel digital marketing solutions, not just a stand-alone display media buy or a social fan campaign, for example. With the new Platform, we can help clients achieve their marketing objectives across the critical digital traffic channels and throughout the marketing funnel.”
Epic Marketplace has strongly leveraged its deep partnership with LucidMedia in the development of certain components of the new Platform’s infrastructure. In particular, the new Platform utilizes key components of LucidMedia’s comprehensive demand-side, real-time bidding (RTB) management platform and its patented semantic contextual targeting engine as integral pieces of the infrastructure of the new Platform.

Through the new Platform, Epic Marketplace is confident that it will provide even greater value for its clients. The company’s enhanced capabilities will allow it to scale campaigns with a universal frequency cap and in a fully integrated approach across social, mobile, display and video, across its own network of premium inventory, and across major exchanges and supply-side platforms such as AdMeld, PubMatic and Rubicon.

“We’re very pleased that after such a long process, this important work for Epic Marketplace has been completed so effectively – and on-time,” said Mathis. “Our new Platform solidifies our market leadership position and allows us to leverage data and enhanced statistical targeting across all critical digital marketing channels. Moreover, the new Platform has been built with an enhanced suite of consumer privacy protections, further ensuring our compliance leadership position as well.”

For more information on Epic Marketplace, please log onto http://www.epicmarketplace.com.

Before I get into the scoring, let me first review a few of the major industry developments since my predictions:

• Consolidation. The Invite Media acquisition was sadly not followed by a string of other overpriced DSP deals. This disappointed a number of bankers and all the DSPs.
• Self-Service DSP. This became a hot commodity briefly. There was plenty of chatter about “trading” similar to a stock exchange environment. Many media planners of old surely cast themselves as the new “mad men” of media.

We all know now that this is just silly. Soon, everyone realized that a slim markup on media is viable only if you have massive scale. The real value is provided by driving outcomes – i.e., layering valuable optimization services on top of the platform.

Data Management Platforms (DMPs). Data drives performance right?  So the reasoning goes like this – if we could value data appropriately, then publishers can be compensated properly for the “true” value of their audience, instead of getting diluted in an ocean of inventory. And so DMPs became the next hot thing for while.  BlueKai and Exelate raised even more money.

Are they still hot? Did the revenues follow? Anyone care to comment on this?  The established data players like Axciom kicked a lot of tires and eventually picked partners or charted their own path.

RTB Changed Supply Dynamics. Massive scale is now available via RTB on exchanges and supply side optimizers (SSP). These are new sales channels for publishers. These channels were and continue to induce bouts of teeth-gnashing and sackcloth-wearing for publishers as they try to figure out how to leverage them without diluting their value.

On the other hand, the traditional ad network has to deal with a new challenge to maintain their captive publisher base. As their publisher based flirted with SSPs and exchanges, networks saw no other option but to take a seat on the exchanges.  They built or partnered to acquire this ability to buy on exchanges. (Congratulations AppNexus – you read this trend well!)

Against that backdrop I thought it would be fun to revisit some of my predictions and throw some bouquets and brickbats at myself. I’ll score them on a scale of 1 to 5 where 1 = “Crack Pipe” and 5 = “Savant.” Just for fun, you may want to revisit your own predictions from last year and score them as well. I will have a glass of wine for all the savants. The crack addicts can join me for a pub crawl.

Prediction #1: Agencies won’t be able to absorb true self-service.

The Thesis: Running display campaigns requires a lot of expertise.  No self-serve DSP provides all of this expertise in a usable fashion for the typical media buyer. It will require human expertise to deliver the outcomes. Agencies do not have this talent and won’t be able to attract this talent.

How it played out: Almost all of the smaller agencies run campaigns with DSPs in “managed service” mode. The DSP typically gets a CPM rate.  Some of the larger holding companies have made significant investments in people to build up internal expertise.

They still use a third-party platform. They still profess independence from any one vendor. And they continue to use up business development cycles in “evaluations” of other DSPs. The media planning groups within these holding companies use the services of the “trading desks” services grudgingly, and continue to RFP externally.

The Score: 3.5. It is too early to call the trading desk experiment a success or a failure.  I would say my prediction is mixed for big agencies, and right on for small agencies!

Prediction #2: The DSP is the next ad network

The Thesis: Building on the predictions that (a) SaaS for agencies will not work out and (b) the change in supply-side dynamics due to exchanges will profoundly impact networks; true value will continue to be delivered by driving desired outcomes for customers. In other words, you make more money by running campaigns well.

This is what an ad network does. (I use the words “ad network” as a placeholder for a marketing services company that runs mainly display campaigns.) If DSPs have to  run campaigns to survive, and networks need the technology of DSP to continue to be relevant, then surely they are one and the same?

How it played out: Lets compare business models.

Demand-Side Platform

• Offers a “managed service” to run campaigns
• May offer a self service backed by managed service
• Pricing is typically CPM, CPC, or CPA
• Client base – agencies and direct advertisers
• Lots of noise about their awesome technology!

“Traditional” ad networks

• The run campaigns – i.e.  – offer a “managed service”
• They are trying to differentiate themselves by offering exclusive inventory
• They build or license technology to buy exchange inventory.
• Pricing is typically CPM, CPC or CPA
• Client base – agencies and direct advertisers

It walks like a duck and quacks like a duck.

So, it must be a duck right? Sort of, except that the duck with a DSP tattoo on its chest is a rocketship!
The common theme here is that both are in the business of delivering outcomes to their customers.  It is just that the inventory situation (supply side) has changed dramatically with exchanges and supply side optimizers.  The demand side has not changed all that much!

The Score – 4.5 Pretty much spot on.

What’s Next?

So what’s next for the evolving DSPs?  Emerging media is a likely wave to ride. Mobile, video, and social media perpetually sit somewhere on the slope of enlightenment. Social is probably the most exciting beach-head that DSPs are now wading into.

With DSP technology in-hand advertisers can quickly build a guaranteed fan base for new products, effectively engage and activate that audience, monetize it and then re-engage in a regular cycle. The DSP platforms with their massive reach and instant scale makes social media activation a solid bet.

Agree? Disagree? Have a visceral reaction? Let the fireworks begin.

You can get the full story from AdWeek.

LucidMedia President and CEO Ajay Sravanapudi said, “After extensive testing on both sides, Epic has recognized that the depth and breadth of LucidMedia’s platform capabilities can significantly advance their ability to get maximum value for their clients. Epic has confirmed that our platform will not only complement but also enhance its existing platform. We have spent a decade building and fine-tuning our demand-side platform for scalable ad operations and we have been working closely with Epic to integrate our capabilities in a way that will give their clients the flexibility and access they need to succeed online.”

In this article, we‘re going to break down different types of targeting and tell a little bit of truth about each type.

Third party user data

There are an ever-profilerating number of companies in the marketplace collecting and segmenting user data. Some of the big names in this space are BlueKai, eXelate, AlmondNet, Bizo and TargusInfo. To use this data, an ad network or a DSP forms a partnership with one or more of these companies and then sells that data through their platform to their customers in the form of audience segments.

Recent hysteria to the contrary, none of this data contains information that makes any one user personally identifiable to the data provider, DSP, ad network or, further downstream, agency or advertiser/client. In fact, if it did, it really wouldn’t be of tremendous value. The main benefit of this kind of data is in the volume of users in any particular segment. If a segment doesn’t contain enough users, the network or DSP isn’t going to see enough impressions to achieve whatever back-end goals the agency or advertiser may have. One perfect user isn’t equal to one million sort of perfect users. The power of digital media is in its ability to scale to achieve reach. If you want one perfect user, send them a letter.

Retargeting

When a user visits a web page, cookies can be used to “tag” that browser. That tag allows an advertiser to them show ads on other sites for that advertiser’s products after that user has left the advertiser’s page. In combination with a big push in other marketing and advertising channels, it is possible to get a lot of browsers “tagged” in a short period of time.

This is not technically complicated and nearly any online advertising management platform can do it. Particularly if an advertiser has not implemented retargeting before, it can provide a tremendous boost to traffic and, ultimately, conversions. The trick is not to implement it clumsily, which is where a good agency or ad operations team will be an asset. Retargeting is one of those display advertising tactics that can come off as “creepy” to an individual user (for example, the pair of pants that followed one user around the internet for weeks, even after the person had made a purchase).  However, done correctly, retargeting is both effective and appreciated by users, who like seeing ads that are relevant to them better than ads that have nothing to do with their interests.

Targeting typically costs a little extra than just serving as many impressions as many places as possible for as little cost as possible, but it’s also more effective when implemented by a talented ad operations team or competent interactive agency. Have you used third party data? What do you think about recent conversations about restricting the use of targeting?

We sat down with them to discuss the future of both LucidMedia and the digital advertising landscape.

LucidMedia: What do you think is the biggest challenge facing the interactive advertising industry?

Natalie:  The fragmentation of audience across media has been challenging for agencies and their clients. Where once direct-from-publisher inventory was sufficient to achieve performance, web audiences have become increasingly diffuse, particularly with the advent of mobile and video advertising. It takes sophisticated technology to be able to reach the right users at the right time and at the right price.

Paul:  The privacy debate continues to be a hot issue for the digital advertising industry.  Media companies need to support our industry groups in their efforts to educate the public. LucidMedia was one of the first DSPs to offer a real-time network opt-out on our homepage.  We work closely with the industry groups like IAB, NAI and Privacy Choice to ensure we are employing the industry’s best practices when it comes to privacy.

LM:  What problem is LucidMedia solving today with its online advertising management platform?

Natalie:  In a competitive economic climate, advertisers are looking to improve efficiency. With universal frequency capping and a powerful optimization engine, the LucidMedia platform produces goal-driven results within budget.

Paul:  Brand safety is a major concern for brand advertisers. Agencies and advertisers come to us for protection that preemptively identifies unsafe impressions and ensures that ads appear only on pages with appropriate content.

LM: You’ve both been involved in start-ups for years. What is your number one tip for entrepreneurs in the technology sector?

Natalie:  Hire a team with complementary skills and the right attitude. It may be tempting to hire all super-stars, but that strategy is expensive and doesn’t guarantee the creation of a functional corporate culture.

Paul:  Focus on getting your product to market and getting revenue in the door when you’re first starting.  The more you have coming in, the better off you’ll be in the long-run.

LM:  Please discuss the recent partnerships LucidMedia has formed and what impact that has had on the business.

Natalie: Getting all the major data providers on-platform has been a huge step for LucidMedia. Our engineering team has been focused on these efforts for some time and now that’s up and running, the potential is enormous.

Paul:  On-platform video and mobile buying is the next frontier for display advertising.  It has been a real growth area for us and our partners, particularly [mobile advertising network] MobClix and [rich media pioneer] Oggi Finogi.

LM:  What is next in advertising business management? How do you see this evolving in the next two to three years?

Paul:  As the big exchanges and agency holding companies choose their partners, there will be another technical revolution. Right now everyone is focused on building out platforms, but soon the push will shift to integrating those solutions. That’s where a company like LucidMedia, with the combined expertise of eight technology-side experts, will excel.

Natalie:  I agree with Paul. White label solutions are becoming the norm. Platforms that exist with purchased technology, but that don’t have the back-end engineering support will experience difficulties when it comes to complex integrations.

LM:  What major trends do you see affecting LucidMedia the most recently?

Paul:  Agency trading desks have been adopting technology like crazy, trying to keep up with DSPs and all the data providers rolling out user interfaces. In some cases, it may be easier to acquire than to build.

Natalie:  There continues to be confusion surrounding RTB and what it means for online advertising.  Everyone bids in real-time now; it’s how the platform decides what to bid that’s the real differentiator.

Early last year the Federal Trade Commission (FTC) began issuing revised guidelines for behavioral advertising.  And the Direct Marketing Association (DMA) and the Interactive Advertising Bureau (IAB) recently launched a new program that calls for labeling online ads that their members serve based on the habits of online consumers.  You can check out AboutAds.info for more information on the new labeling guidelines.  Our Congress has even been exploring online privacy legislation that would set new boundaries for the collection of personal data by online advertisers.

Amidst all this change and heightened awareness, LucidMedia continues to take privacy seriously.  In fact, we were one of the very first demand-side platforms (DSP) to offer a real-time network opt-out on our homepage.  We are working with all of the leading privacy authorities to ensure we are employing the industry’s best practices when it comes to privacy.

When it comes to privacy, LucidMedia does not use any personally identifiable information (PII) and we do not work with partners who do employ PII.  We do not track or target specific or individual users online nor do we acquire data from providers who do track specific or individual users online.  We do not employ regenerating or FLASH tracking cookies.  Any cookie we do place is set to expire at no more than 90 days.  We use anonymous and general demographic data only, acquired through 3rd party providers or interpreted by our patented contextual engine, to improve the overall effectiveness of our campaigns.

You will find our corporate privacy policies available online at lucidmedia.com/legal.

The combined lift of using display advertising with search

There are a lot of reasons why these two mediums yield a synergistic effect. First, display has been proven as a strong way to drive brand awareness and recall and drive increased purchase intent. Display helps win users over who may still be sitting on the fence about converting after they search for after they are already interested in your brand. Display has also been shown to drive branded searches which is an early step in driving return as users pass through the sales funnel. Users usually visit your site by clicking on a display ad then they come back through search when they are ready to buy, sign up, download, register, or fill out your survey.

The same goes for video and mobile when it comes to cross-channel marketing online. Platforms that facilitate display combined with video and mobile drive an additional synergy as those very same users view a pre-roll ad on YouTube or catch an iPhone interstitial ad inside their favorite free app. This is one big reason that LucidMedia has worked so hard to unify display with mobile and video as well as leverage search data in our campaigns. Reach and frequency were always the original tenants of traditional marketing and they are translating perfectly to the digital realm.