In a world not so far away, the Internet was born. During its toddler years, it gave us connectivity, knowledge, and accessibility (among other things). Then came the teenage years and with it, annoyance – pop-up ads, malware, clickbait – and an odd rebellion – ad blocking, VPNs, incognito modes.
The Internet – or rather the World Wide Web – is now 27-years-old and it seems to be quite the millennial – at least as far as brands are concerned. It is entitled and arrogant, serving us ads we don’t want to see; it’s selfish, following us around regardless of how we feel; and it wants recognition, because it thinks it deserves at least that much (preferably in the form of bigger budgets) for all the data it provides.
As HR managers and organizations have grown tried to adapt to the behavior traits of millennials, so have agencies grown tried to adapt to the unique traits of the Internet and all its users. But, just as HR needed an expert to guide them into better understanding the twisted minds of millennials, so did brands and agencies in order to understand the constantly evolving Internet.
Adtech is to advertising what Simon Sinek is to HR and management.
No wonder then that everyone is trying to acquire it.
We spoke to four experts to find out what’s going on:
Dirk Henke, managing director – emerging markets, Criteo
Puja Pannum, managing director, Blis MENA
Steven Sidawi, associate digital director, J3 MENA
Nader Bitar, senior director, MMP
What really is adtech?
Adtech is an umbrella term for a set of technologies designed to help advertisers target key audiences, deliver messages and measure digital advertising performance. That said, planning has become a crucial part of adtech’s value.
Adtech vendors provide technology solutions which support the management and execution of paid media activities. This is the type of marketing that requires a company to pay to play. For example, social ads like promoted ads on Facebook, Search Engine Marketing (SEM) and display ads belong to the field of ad tech; but you can also put Demand Side Platforms (DSPs) and Ad Servers under the umbrella of ad tech.
I like to boil it down into technology that can efficiently help you reach the right audience at the right time with the right message. Adtech [is a set of] tools that can really help you run your campaigns more effectively. It can provide ways to connect buyers and sellers of media in an automated way, reach the desired audience or even deliver insights that would normally be difficult to capture.”
Adtech, or advertising technology, refers to the use of machine learning, algorithms, analytics and digital tools to accurately direct advertising to individuals and specific target audiences. [Basically], it is the robotic way of advertising. Mistakes are minimal with full transparency for the industry. Adtech, for me, is the present and the future – either you are in or out.
How is adtech different from martech?
Fundamentally, adtech and martech help reach different objectives. [Although] advertising is typically about building brand awareness and acquiring new customers in the digital domain, it’s a more transactional undertaking. Marketing is more specifically about the automation of broader marketing tactics, including closing off the purchase loop for measurement and attribution purposes. There are, of course, areas of overlap between the two and the companies that deliver them.
In comparison to adtech vendors, martech vendors are targeted toward workflow automation and campaign management. These solutions streamline the administration and execution of activities with owned media (company websites, email or social pages) and earned media (social media conversations or PR).
It is important to keep in mind that similar to adtech, martech vendors rely on a data and operations infrastructure, which is the foundation of the technology landscape and supports all marketing activities for paid, owned and earned media.
Both have different functions in targeting and strategy but, to truly understand the differences, let’s put it in the context of three key pillars:
|Audience||Reaches the audience based on behavior, interest and actions||Reaches the exact user based on emails, profiles, CRM data, etc.|
|Data||Reaches the audiences using third-party channels such as social media, DMPs, smartphones, etc.||Reaches users based on data collected through owned channels such as portals, websites, webinars, offline registration forms, etc.|
While both, adtech and martech, are different, they need to work together. So, let me use the term ‘MAdTech’ for now, wherein you automate the entire data collection process and segments, and match, target, and segment data more efficiently by blending CRM data with DMPs thereby creating a rich and holistic data offering for marketers.
Martech are technologies that help you communicate with consumers or prospects that have already had some sort of interaction with your brand. Typically these are associated with the brand’s owned channels, which are usually managed in-house by clients.
READ MORE: The difference between adtech and martech and making sense of all the jargon by Hussein Dajani, general manager – digital marketing, AMI region (Africa, Middle East, and India), Nissan Motor Corporation
What are the challenges when it comes to adtech?
One of the key challenges in the MENA market at the moment is the reluctance to further adopt mobile as the primary marketing tool. Despite the fact that smartphones are hugely popular in MENA, marketers still display a preference to more traditional forms of advertising. Over time, we expect to see a rebalancing toward mobile as it’s given the priority it deserves.
From a client and agency perspective, there are concerns from advertisers over brand safety. There are three key components to brand safety: (1) seeing ads alongside appropriate content, (2) viewability and (3) making sure they are seen by real people. The responsibility for this lies on all sides, but primarily with vendors and agencies to allay the concerns of the brand. To achieve this, transparency is crucial, as it helps brands understand where their ads are being served. Transparency itself is another crucial challenge, as brands need to understand how their budget is being spent and what their investment is getting them.
User habits are rapidly changing with smartphones being the core facilitator. These habits can be activities ranging from looking up news, checking social media, shopping online, offline and across devices. Changing habits mean changing expectations, and today’s shoppers expect nothing less than an outstanding user experience across all devices and channels, including offline. Retailers and brands must deliver seamless and relevant shopping experiences across all devices and channels, which is a huge challenge that requires new strategies. In this respect, giants like Amazon and Alibaba have a head start on how to organize and apply data at scale to understand the shopper, reach them, and inspire them to buy. The vast majority of commerce companies can’t cope with this.
One big challenge we face is education. People – be it in agencies, client-side or the market as a whole – have difficulties understanding the sole purpose of adtech and its simplicity in the advertising world. They do understand the efficiency behind it, but the market is too traditional today to shift its whole strategy around ‘MAdTech’.
Challenges in the market:
- Cultural nuances: Strangely enough cultural nuances have even caused adtech challenges – device sharing; the need to browse anonymously and even declared data can cause targeting and tracking to go a bit haywire at times.
- Not a priority: MENA is sometimes overlooked by the tech giants as not being a priority market, so the roll out in tech advancements typically occurs in other markets first.
- Publishers: Some hesitation to integrate with agency adtech to drive an agenda or premiumization or to diminish transparency imposes limits to scale and confidence. However, this particular point can be tied back to misaligned interests as publishers want to drive the maximization of yield, while agencies that have invested in adtech want to let tech pre-validate inventory, while also letting “the market” set a fair price.
Challenges from clients:
- Integration: Although, breaking down the silos between martech and adtech can yield immense benefits for organizations, it’s always a challenge to integrate buy-ins and data structured in a way that is easily ingestible by adtech.
- The drive for efficiency: In today’s advertising world, the main theme that is emerging is ‘more for less’ and with that dynamic occurring, investing in the right adtech, which aligns with market sentiment, is becoming more and more important.
Challenges with third-party companies:
- Bundling: Sometimes, really interesting adtech is tied to certain inventory and you are compelled to buy that inventory to avail the use of the adtech. Most of the time this limits scalability.
- Siloing: Sometimes, providers purposefully limit each other’s access to inventory, so adtech that is supposed to connect buyers and sellers is excluded out of certain pockets of desirable inventory.
What’s the future of adtech and what new technologies can we look forward to?
Within the location sphere, we’ve seen a big shift in 2017 toward cost-per-visit (CPV) metrics. From a geolocation perspective, it’ll be really interesting to see how location services may start to converge with other techs such as AI and the IoT. As technologies such as AI, AR/VR and IoT develop over time, solutions that we haven’t even begun to imagine yet will emerge.
Data plays a pivotal role in the future of adtech, retail and the whole industry as online and offline are merging faster than most would’ve imagined. The vast majority of retailers are at a significant disadvantage to the global retail giants when it comes to data – both, in terms of volume and their ability to make it accessible and actionable to drive sales. Hence, it will be essential in the future to have access to online and offline data, the ability to match them across devices and channels, analytic capabilities to turn them into valuable insights and machine learning technology to execute on them.
The biggest need might be coping with the blurring of online and offline commerce. Adtech, so far, is purely focused on online, while retailers traditionally run siloed approaches of their online and offline activities. To meet the expectations of today’s omnishoppers, retailers must break up these silos and look for solutions that help them address their online audiences offline and vice versa.
Adtech companies will become smarter and more efficient. The media market needs more efficiency, transparency and control. Adtech companies are providing all three and they will become more user-friendly. We can look forward to smarter ad servers, more effective SSPs, smarter DSPs, and new currencies of advertising, which exist in the US and Europe. Ideally, I want the market to look at “other” options out there, considering we are dominated by the big tech companies and that’s it. We are in a dark tunnel, but there is light at the end of it. I advise all parties to look at the industry and innovations available, which will help leverage their business much more than the big tech companies.
Agencies need to become centers of excellence, which successfully drive the integration of adtech and martech, along with the layering of various other technologies such as artificial intelligence and predictive ROAS engines that ladder up to the overarching sentiment of driving efficiency. This boils down to delivering better art, better science and better outcomes. [With this in mind], we can look forward to:
- The crux of data and technology: Integrated predictive ROAS modeling coupled with Artificial Intelligence is going to be a really exciting space, which will really transform the way clients and agencies work. It will take the guesswork out of deciding which product they should support, audience they should buy against and messaging they should relay.
- Further buying consolidation: Programmatic Everything (TV, Outdoor, etc.). More media channels will eventually join the market-making fold, which will help scale automation, efficiency and ROAS.
- More transparency and validation: More transparency as more publishers join the push for quality and more validation as tech players decide to jump in the market. More tech players offering on-target reach is one that I am particularly excited about.
All in all, the adtech and martech space is much-needed and is only going to grow. But, as it currently stands, there remains a fair amount of confusion and lack of transparency and as ex-Carat boss Martin Cass said at Advertising Week New York, “Where there’s confusion, there’s opportunities to make money.”