Tim Nichols: You’ve said that you’ve found companies use on average of 5-7 tech products in their stack. Why do you think that is the case?
James Curran: Over the past few years, ad technology providers have exploded. Some of it isn’t new technology, but rather products that ad networks have built and used over the years to help them run their business more efficiently. Such as cookie data, ad verification, even CRM tools. Over time, everyone found they could make use of these same tools, not just ad networks. So companies popped up to offer these things specifically. If you are a media company, it just makes sense to work with a provider who does that one thing really well rather than build it. Before you know it, you have 5-7 pieces in your tech stack. We’ve even seen companies with 10-15 pieces.
TN: How are they choosing these providers?
JC: Some pieces can be added fairly quickly, so the stack gets built in no time. Other parts are a long and arduous process, with RFIs, pricing negotiations, as well as the implementation and training that comes along with adding a new provider. This is because tech buyers want to pick the right partner for their business and plug it in with care so that the most value can be extracted from it.
TN: Is there really added value?
JC: We believe so. There is value in every one of these technologies if used properly. It is the reason why ad networks flourished with high margins, great targeting and scale. None of that would be possible without technology behind it. They have had data platforms, optimization algorithms and semantic processing all along, now it is just available to everyone, so it’s an arms race.
TN: How do companies keep up with it? Is there fatigue?
JC:If you aren’t keeping up with it, you are wondering why your fill rates are low if you are a publisher, or winning bids to hit that audience become harder if you are a marketer. Those who innovate with new technology get an edge.
There is a point to where it is hard to keep up though, inefficient even. Just dealing with another integration or partner can be tiresome; even though it is clear there is better ROI on the other side. That’s where STAQ helps, by aggregating reporting from their entire stack or making a connection so the pieces of the puzzle work more fluidly, making each piece more valuable to the user and making more sense of all the available data and associated analytics.
TN: Thanks James!
Article was original published by Tim Nichols on September 12th, 2012 at ClickZ.