This edition of Real-Time Banter highlights a talk about mobile programmatic advertising with Joe Prusz, Head of Mobile at Rubicon Project. Joe was interviewed by Jennifer Lum, Chief Strategy Officer for Adelphic.
Jennifer: What is Rubicon Project?
Joe: Rubicon Project is a global technology company leading the automation of advertising. Further, we’re the only independent marketplace to automate the entire advertising ecosystem across all inventory types, ad units and channels.
What is your role at Rubicon Project?
As Head of Mobile, I lead all activities for mobile from sales and accounts to product management, across both buyers and sellers. It’s busy, as it’s a very exciting time for us and the industry, and already mobile accounts for more than 20% of our revenue (up from zero three years ago).
How have Publishers’ view of programmatic changed over the past couple years?
Wow, how they have changed.
When it first started, programmatic advertising raised concerns that it might degrade yield and reduce control. And, in the beginning, those fears held back some of the more traditional publishers in the industry.
But, as the years went by and we proved that was not true, almost every major publisher started posting job listings for programmatic sales leads. The industry thereafter has propelled itself forward with programmatic leading the way, and that word is no longer synonymous with “unsold” or “remnant” inventory.
Today, leading publishers are using programmatic to help automate portions of their direct advertising channels.
What are the key differences in bidding on desktop inventory vs mobile inventory?
The first has to do with a lack of cookies in mobile, so the underlying infrastructure that helps bidders make intelligent bidding decisions doesn’t work.
As an exchange, we have to make sure that everyone is speaking the same language, which is more complex in mobile. The number of parameters in the bid packet on which to base a decision is dramatically greater in mobile, so — as an exchange — we have a lot more work to do to make sure we support our mobile DSPs effectively.
One thing that’s much more easily understood in desktop is the taxonomy of how accounts and sites are created. For example, with a publisher of ours like NBC, you have sites at the account level and you have properties broken out into the sites that we see online: NBC News, NBC Sports, and NBC Local, etc.
In mobile, you have different identifiers for apps that are all used differently. Some DSPs target off of app bundles, some target off of app identifiers or app store URLs, etc.
As an exchange, we have to make sure we support all of the different parameters that are targeted and that drive decisioning. However, some of these parameters must be used in parts of the OpenRTB spec. We made a decision to use app bundle as the main app identifier, whereas others have chosen app store URL. Regardless, all of the identifiers have to be understood in the exchange, so even something as simple as knowing how to identify an app can get complex.
On our side, the work that we have to do as a demand-side platform in bidding across multiple exchanges is to figure out how to decipher the way that each exchange has decided to structure and share data, sometimes coded in a proprietary manner, and then normalize that on our side so that we know that app bundle 123 from Rubicon Project equals app ABC on another exchange partner.
Yup, exactly. And when you go back just 18 months ago, we had 10 different versions of device IDs. And some were hashed while others were unhashed, so sometimes we would find that we were receiving a hashed ID and were rehashing it.
It was just a tremendous struggle until standards were created in the form of the Google ad ID and IDFA for iOS. Those two simple things solved a lot of problems in the industry. Even though these advertising IDs are privacy compliant, we still have some DSPs or publishers that require them to be hashed again. Those are all things that have made mobile more complex than anything we had to solve for in desktop.
Yes, the amount of fragmentation is quite challenging. How many DSPs are buying both desktop and mobile inventory on Rubicon Project’s platform?
What’s working well in mobile programmatic?
In addition to App Download advertisers (CPI) we’re seeing huge growth in brand advertisers and mobile video advertisers.
“The opportunity in Native is tremendously exciting for both buyers and sellers. We’ve all seen the stats on how native ads perform, and I call it a trifecta for the industry – a win, win, win.” – Joe Prusz, Rubicon Project
What are your biggest challenges?
This is mobile, so we have a lot of things we’re working to solve.
One of my biggest areas of focus is helping to grow Native Advertising in the real-time bidding (RTB) market, where our CTO Neal Richter co-authored the IAB spec for OpenRTB 2.3 for native ads.
The opportunity in Native is tremendously exciting for both buyers and sellers. We’ve all seen the stats on how native ads perform, and I call it a trifecta for the industry—a win, win, win.
First for the advertiser, higher CTRs, better performance than ads of a similar size, and therefore (second) better CPMs for the publisher or mobile app developer. Third — and most exciting — it’s a win for the consumer. It’s a much better ad experience, and — if we’re thinking about mobile and this really small real estate space — its a way to make sure that the app experience is as good as it can be, that the content and the advertising is well integrated.
I think we all understand how exciting an opportunity Native is, so the question is how do we drive dollars into it?
In our industry, we often see the ad networks tackle a new opportunity first. That works for the buyers because they’re off-loading that burden onto a third party as the new market evolves, and as the standards evolve. That’s a lot easier than taking every new opportunity in-house.
But as the market grows and — frankly, as we automate the processes around it — the interest and the excitement grows with all parties. For example, the creative aspect is going to be a challenge for many DSPs; they will struggle with how to actually support and host the many different native ad units. But for us, it isn’t really that complicated. So we’re going to work closely with DSPs to help them buy native supply at scale.
As an industry most people—whether you’re on the buy side or you’re on the supply side—are excited about the potential for native given that it’s the first format that really makes sense for mobile. Of course, we want things to happen immediately but we need to remember this is a work in progress and the work needs to start on the supply side, which Rubicon Project is helping to lead with publishers, to make inventory available for monetization.
In order for brands to reach consumers through these new and great ad units, and over time and as more and more inventory becomes available from a diverse set of publishers that helps us as a buy-side platform build the case for brands and marketers to invest in this scalable new format.
We’re really optimistic and excited for the potential of native.
Exactly, and I think that’s a point that you and Emily Del Greco (Adelphic VP of Sales) have made in the past year.
We have seen innovative apps in jump forward to push Native ad units, such as Pinterest, Polyvore, Tinder and more. But the brands are waiting for very premium content providers and media brands to jump in.
That’s great news for us, as Rubicon Project is home to the comScore 500. Sixty out of the top comScore 100 publishers are on the platform which will allow us to help them embrace Native which will — in turn — help bring brand dollars into the industry.
What percentage of Rubicon Project’s transaction volume will be on mobile inventory in 2015?
As a public company I can’t disclose that, but I can tell you that mobile is now over 20% of our company’s managed revenue. We’re expected to deliver over $200M in mobile MR in 2015.
In 2016, what do you expect the split between open exchange, private marketplace and automated guaranteed to be through Rubicon’s platform?
That’s too hard for me to predict in 2016! But I can tell you that mobile private marketplaces (automated direct orders — both guaranteed and non-guaranteed) are growing dramatically for us, and for the industry. It’s really exciting to watch the industry evolve!
Open auction is still hugely important in the mix, but direct orders more closely mimic how the majority of buyers deploy their budgets today.
What was your first mobile phone?
I’m pretty sure I convinced my mom I’d be safer if I had a Motorola StarTac in my pocket. Not to brag, but I think I was one the first kids in my high school to have a mobile phone. So, in retrospect, my career in Mobile was born at an early age.
A whole lot safer and a little bit cooler. My first mobile phone was also a StarTac and I loved it.
Somewhat related, my mom started taking fortran and cobol programming classes in Indiana at a technical institute back in the 80s and she would always come home with the latest gadgets. She came home one day with the first Panasonic mobile phone that was like a pack where you can like strap it on your back or put it on the minivan, and it was awesome.
That is very cool. That probably predated the Zack Morris phone.
This actually came out after that I think. We should get a date on this. The Zack Morris came out super, super early. [Editor’s Note: Zack Morris used the Motorola DynaTAC, which received approval from the U.S. FCC in September of 1983. Joe’s mom brought home the Panasonic Racal Vodafone, which came out approximately 1985.]
Last but not least – what is your favorite mobile app?
I can’t pick just one. So here it goes – Social Media: Instagram (I have a young family and most of my friends do too, so keeping up on everyone through pictures without having to read rants is key); Utility: Uber (how did we ever travel before?) ; Music: toss-up between Spotify and Pandora (I leverage both for different reasons).