Google's David McMurtrie - The rise of unified ad-tech platforms drives transparency and efficiency
Tech firms in London have attracted more than $1bn of investment so far this year, 30 per cent higher than in 2013 and more than 10 times the amount raised in 2010. Across Europe, technology start-ups are also bringing new vitality to trade shows like DMexco and IBC, which set the pace of new trends in the digital technology industry.
It is reassuring to see that the number of smart start-up companies shows no signs of declining - they are driving growth and innovation in our industry, and there is no question they will continue to do so.
But leave aside what’s happening at the periphery of the business, and another trend is emerging; the rise of the unified technology platform. The rate of acquisition by the leading global digital players has increased exponentially in the last two years with each company competing to offer a holistic and future-proof technology solution.
I think that two main principles underlie this trend.
Firstly, the need to bring greater efficiency and transparency into the ecosystem. One of the perceived wisdoms on programmatic trading is that it delivers efficiency in itself but that is clearly not the case if there are multiple vendors involved on both the supply and demand side of the transaction.
That is why at Google our aim, through technology solutions combined with service, is to simplify this process as much as we can. To address these efficiency issues, publishers and advertisers need to leverage unified tools to connect their media, workflow, and data strategies.
This was highlighted in the recent study on Improving Engagement and Performance in Digital Display Advertising conducted by The Boston Consulting Group. Regardless of size, every publisher or advertiser can benefit from a unified technology platform that doesn’t differentiate between mobile or desktop, first-party or third-party data, direct sales or programmatic.
The same report unveiled that while digital channels play an increasingly influential and complex role along the entire consumer-purchasing journey, many advertisers and agencies have yet to take advantage of its full potential. Among the top reasons for this are inconsistent campaign execution, and fragmentation in campaign strategy and development. Unified tools help address this issue.
Secondly, managing the supply and demand chain within one ecosystem brings benefits of scale, but also addresses the wastage that exists within our business by delivering vastly improved yields for publishers and ROI for advertisers.
By allowing competition within the ecosystem, publisher yields can be optimised by up to 30 per cent and the increased visibility on audience analytics and attribution for buyers means that they can buy precisely the audience they want across channels at a price which the market sets.
Advertisers can improve digital campaign performance and engagement by 30-50 per cent by adopting this approach and our own evidence shows that buyers are still prepared to pay premium CPMs for valuable, difficult to reach audiences.
Looking forward, the trend towards increased unification is set to continue with every major digital company actively expanding their technology platform. The advantages that a unified technology platform delivers across the ecosystem means that we will continue to see very active acquisition strategies by all of the key players over the next 12 months.
David McMurtrie is head of UK Publishers at Google.