This edition of Real-Time Banter highlights a talk about mobile advertising solutions with Ian Johnson, Managing Director of Global Product for Cadreon. Ian was interviewed by Jennifer Lum, Chief Strategy Officer for Adelphic.
Jennifer: What is Cadreon?
Ian: IPG Mediabrands first established Cadreon as a trading desk in 2008 to deliver programmatic media buying. Since then, Cadreon is evolving from a trading desk to the technology engine for IPG Mediabrands with an objective to create custom automated solutions for client campaigns at scale. Product development and customized data stacks have become key investment priorities as we have made the transition.
What is your role at Cadreon?
I am the Global Product Lead. My team develops the platforms and solutions that deliver our programmatic campaigns. All the campaigns that we run, all the analytics and reporting, are using the solutions that my team creates either through partnerships with ad tech partners or by building our own technology in-house.
We’ve noticed that you’ve assembled a great group of product managers at Cadreon. What is it about Cadreon that’s attracting great product people – including you –from the tech world to the agency world?
Well, to be honest with you, we probably think of ourselves still as part of the tech world. We’re at the heart of trying to deliver ad tech for our colleagues in Cadreon to use. The reason that we are able to get such great talent is that not only do we build our own technology, with substantial investments in data analytics and a whole new front-end user experience that we’re going to make available not just to Cadreon, but to our agency partners and ultimately directly to clients as well. But we’re also working with the world’s leading ad tech companies, such as Adelphic, and that’s really exciting. We get to not only understand what the likes of Google and Facebook are doing, but also the most innovative startups you can imagine. That’s the kind of richness in our environment—it’s pretty cool.
Having ample resources and access to scalable budgets is extremely valuable. Can you describe Cadreon’s platform to us in greater detail and how and where partners are integrated?
The basic philosophy we have is that no partner can do everything, and no one can be the best at everything. Even if there are some partners that do things really, really well—especially here in the U.S.—they might not be best in a smaller market halfway around the globe. So, what we’re trying to deliver in our platform is really that plug-and-play framework that allows Cadreon programmatic specialists to work with multiple buying platforms, DMPs, data stack and attribution; have a consistent user experience; and drive the multiple platforms as if they were a single platform. So that’s what we’re trying to achieve. Where we started, as Adelphic knows, was historically focused on the back-end, so was all about integration of the reporting and syndication for data. However, where we’re going now is the front-end campaign IO integration piece and the user experience associated with that set-up and tagging piece.
“We’re working with the world’s leading ad tech companies, such as Adelphic – and that’s really exciting. We get to not only understand what the likes of Google and Facebook are doing, but also the most innovative startups you can imagine. That’s the kind of richness in our environment. It’s pretty cool.” – Ian Johnson, Cadreon
In your opinion, what is the state of audience-based buying today?
Inside the agency, it doesn’t seem to be a discussion anymore. You don’t have to talk about why audience buying makes sense, it’s a given at this point. The cross-screen challenge is getting a lot easier for us, particularly across the disparate platforms. We’ve had probabilistic cross-device solutions for a while, but now we’re adding deterministic solutions into the mix. Very recently through Facebook and Google, we’ve started to get attribution credit as we optimize across screens. Where the challenges are – the audience insights piece and the DMPs – are still very much web cookie centered so we’re counting on improvements on the DMP side so we can truly get that kind of cross-screen insight in our main analytics platform. Also, we’re doing a lot better in terms of being able to tie offline IDs and online IDs—particularly here in the States. We have this big data initiative called AMP—and that’s the key focus for us. TV is a significant part of the campaign budget, so you really need to understand how it influences your digital performance and we’re also trying to bring TV into the programmatic-like executions. I think audience-based buying is in a great place currently but has a long way to go for it to really deliver where we want it to be.
If you look at mobile and specifically mobile programmatic, what’s working well for Cadreon?
The mobile programmatic space has grown quite a bit over the past couple of years. If you go back a few years, the mobile DSPs compared to online DSPs were pretty basic so from a platform capability point of view, they’re really robust now. The inventory mix is really rich now as well, the development of private marketplaces for mobile has really come along compared to say, a year back. The cross-sandbox issue—the separation between mobile web and application—is a lot easier for us to manage now, so we can retarget mobile users in application based on their mobile web activity which is good. I was saying earlier that the cross-device, at least from a campaign execution point of view, is a lot better off and we’re now getting attribution credit for it which was a challenge previously. Those are things that I think are strong from a mobile programmatic point of view.
“The cross-sandbox issue—the separation between mobile web and application—is a lot easier for us to manage now, so we can retarget mobile users in application based on their mobile web activity which is good.”
You have mentioned a few challenges. Are there any other challenges that you would highlight in mobile programmatic?
I think the main thing is no matter how much folks say they understand the mobile differences, the reality is that they want it to just be like online, but as you know there are many nuances in mobile. Things like viewability measurements are challenging; we’re held to viewability standards both from percentage in-view as well as measurability rates and that’s kind of broken in mobile currently. Some of the anti-fraud solutions that we have in place don’t seem to be quite as effective in mobile so that can be challenging for us. Not so much a challenge, but a huge opportunity is optimization to footfall traffic. Everyone’s excited about doing it but the solutions so far have come up a little bit short. The measurement part is “Did the guy see a car ad and actually go to the dealer lot?” Reporting is getting better—it’s still not great—but what we really want to do is optimize media buying to what generates the foot traffic. The optimization piece is not working currently so we’re still working on getting that right.
Which regions are driving the most growth in programmatic buying at Cadreon?
Our markets grow as the market programmatic grows. We’re heavily driven by U.S., U.K. and Australia. So those are the markets that show the greatest mobile growth. There are a few European markets that seem to be very interested in mobile like Netherlands, Germany and France but it’s basically U.S., U.K. and Australia that are the lead markets.
IPG has taken an aggressive stance in driving programmatic adoption across the company. In 12 months, what percentage of IPG’s spend will be programmatic and in 36 months, what do you expect that percentage to be?
This can be a misleading number because of how you define programmatic and how it then feeds into the automation goal. For Cadreon it tends to get a little distorted because a 100% of what we do is pretty much considered programmatic but overall it’s currently looking at about 30%. Digital is currently growing quickly programmatic and in the next three years it’s going to be well north of 60%. The other thing is that on TV we’ve got a solution that’s programmatic-like and we call it advanced TV and currently it’s a small fraction of the TV spend. Less than 1% of TV spend is going through this particular platform but in the next three years I expect this to be let’s say 5% of TV. That’s a healthy number from a spend point of view and will make TV a large component of Cadreon’s income.
That’s significant spend. That’s impressive and exciting. Our two final questions are personal, fun facts for people to learn about. The first is – what was your first mobile phone?
I should declare that I started my career in mobile, designing cellular networks around the world. I was involved in the roll out of TACS, the first generation mobile system in the UK. As we were building the 1G cellular network, we used a mobile phone system that was called System 4. The mobile was made by a company called Pye– Pye was a part of Philips. You basically screwed it in the trunk of your car and it was absolutely enormous. The first portable I had after the launch of the TACS network, was I think they called it a Motorola DynaTAC, which was basically like a big walkie-talkie. Then, I helped launch the GSM network in the U.K. and it was a Motorola StarTAC that I had.
Very cool. You really have been involved since the beginning of mobile.
That’s right, I helped design the specs for GSM and I was the CTO for Vodafone when we rolled out 3G in Portugal. I remember my first 3G phone was an Ericsson phone; it was my first phone with a QWERTY keypad.
Final question, what is your favorite mobile app?
So the one that’s my absolute favorite – probably because of the amount of UX design we do – is a stock app called StockTouch. It’s very tactile and it’s got a wonderful dashboard that gives you instant feedback in terms of how your stock is going. I like people to be thinking about UX—I love that app. However, the one I use the most often is 2048. I’m completely addicted to that game, I have to say.
Ian, thank you very much for walking us through your answers to these questions, sharing your insights and thoughts with us.