What on Oath: Global adtech platform chief reveals market plans following AOL-Yahoo merger
- 13 September, 2017 07:00
An open and integrated platform approach, verified first-party audience data and content investment lie at the heart of Oath’s plans to shake up the adtech platform space, its global product technology chief claims.
Oath president of adtech platforms, Tim Mahlman, caught up with CMO during a recent visit to Sydney to reveal the group’s modus operandi, what it’s really going to take to bring AOL and Yahoo! together, and how the combined entity plans to carve a deeper etched position for itself against next-generation platform goliaths, Facebook and Google.
Oath is the umbrella brand Verizon has created to sit across its wide cluster of 50 brands in the media, Internet portal and ad technology space. The official launch of Oath at Cannes in June followed completion of Verizon’s US$4.5 billion acquisition of Yahoo!. Other well-known brands in the portfolio are HuffPost, TechCrunch, Brightroll, Flurry, Tumblr and Engadget.
Verizon acquired AOL in 2015 for US$4.4 billion. Combined, Oath represents more than 1 billion people globally and is headed up by former AOL CEO, Tim Armstrong.
In his worldwide role, Mahlman oversees the technology Oath licences for advertising agencies and brands, along with products such as its supply-side platform for publishers, acquired attribution modelling tool, Convertro, and programmatic linear TV product, One:TV. He joined AOL after the ISP acquired his startup, Vidible.
Mahlman boasts of more than 20 years in the online advertising space globally with a resume that also includes Klout, Livefyre, elicit, Collective Media and BlueLithium. Earlier in his career, he worked as VP of network sales at Yahoo!, taking charge of the company’s $500 million performance display advertising division.
The first thing Mahlman stressed was Oath’s plans to respect its 50-plus brands.
“The Yahoo! brand, especially in Australia, is going nowhere,” he told CMO. For one, the group is still committed to its joint venture with Seven West Media on Yahoo7 but will look to enhance the product mix further. “The AOL brands, from a platform perspective, are also not going anywhere in the near term.
“The thinking behind ‘Oath’ was looking at the values that drive this business. It’s the idea of saying we’re making a commitment and promise to still invest in brands people love. There is such great loyalty behind those brands, we don’t want to slow that down. We want to invest in them even more and make them stronger.”
Yet it’s clear there’s an intention to leverage different components across brands to create a better offering for all. As an example, Mahlman pointed to a deal struck between Yahoo and HuffPost teams that now sees HuffPost content on Yahoo’s homepage.
“Just three weeks after launch, it’s created this massive lift in engagement for both the homepage as well as viewership within HuffPost,” he said. “That’s an example of two companies that have never worked with each other now that by being under the umbrella, equally benefit.”
Single adtech stack
Consolidation is also the objective on the adtech front. The company has built a roadmap to pool technologies offered by AOL, Yahoo and their subsidiaries into one single adtech stack.
“The industry has looked at AOL and Yahoo as two competing companies. Yet if you look at both companies from a platform standpoint, there was only about 5 per cent overlap with clients with certain products,” Mahlman said.
“We’re going to take the best of what both advertisers and publishers loved and build it into a centralised technology. In some cases, we’d looked at the world very differently. By coming together, it’s an opportunity to be that much stronger.”
It’s all about data
It’s not an easy task, however. The adtech space is awash with small and large-scale players and an incongruous mix of technologies and feature-sets, making navigation a minefield for vendor and marketer alike.
For Mahlman, Oath’s major differentiation point is data. From a first-party standpoint, he claimed the group has a scale and breadth of people-based insight very few can match globally. Yahoo’s approach, for instance, had been built off leveraging first-party data, piled into a centralised data lake that formed the basis of open source big data framework, Hadoop.
A resulting product is Yahoo’s Audience Building product, which allows users to create custom segments to then leverage through the group’s demand-side platform.
AOL’s data approach meanwhile, has been about performance-based optimisation. “AOL does as well when it comes with our parent company, Verizon. Granted, that’s more of a US-centric point, but in the coming months you’ll see we are starting to build strategic relationships within international offices that will allow the same success we’ve had leveraging that [Verizon’s] data in the US be achieved in other markets,” Mahlman said.
Since the Verizon acquisition two years ago, AOL has built the ability for customer hashed credit card data to be anonymised and delivered piped into its DSP to use for ad targeting, Mahlman continued. This has been offered in the US under its ‘Real Audiences’ product, and it’s something the company is now looking to bring to Australia.
“I want to leave you with the thought that the next time I’m back in Australia, I’ll be talking about more alliances that enable us to have more first-party data flowing through our technology. It’s what we stand behind and differentiates us from the competition,” he said.
“Equally, look at the inventory Yahoo! and AOL has thanks to other deep publisher partnerships, such as Microsoft in the US. We maintain an ecosystem that encompasses having your data flow through with ours, through to how it’ll be served and the inventory it’s going to be delivered against.”
Buying on a URL basis is a thing of the past, Mahlman claimed. “Now, it’s about finding the audience, executing against it with as much detail in the data as possible, across whatever sites they’re going to,” he said. “That’s what Oath is bringing to the table.
“Real Audiences for example, creates a human metric to help solve this audience validation problem.”
Up next: Competing with Google and Facebook plus how to evolve the programmatic advertising industry
Content and competing with Google and Facebook
Another selling point Mahlman highlighted is Oath’s open approach to platform development and integration. While quick to dismiss claims the group is setting itself up as a direct third competitor to the Google/Facebook duopoly in the online ad market, Mahlman nevertheless positioned its open approach as a differentiator.
“We are making sure we’re open to working with all partners and ensuring those buying through us know exactly where their inventory is going, so they can have the confidence we’re protecting their brand as well as the consumer experience,” he said.
The other way Oath positions itself is through content. Mahlman claimed both Yahoo and AOL made smart investments to ensure media is at the forefront.
In Australia specifically, AOL’s product mix locally has purely been on the supply side, from display to programmatic TV. Moving forwards, Oath is looking at introducing more publisher brands locally alongside HuffPost, such as Techcrunch and Engadget.
“Content is very important to us – in fact, it drives all of our business,” Mahlman said. “Unlike some of those we compete with in some cases, the consumer is first, whether it be media or platform side. Our charter is what we believe we can do with these entities coming together.”
It’s this quest to be open and content-led that Mahlman also hoped will encourage third-party publishers to unite with Oath on the supply side.
“Instead of working with 30 different marketplaces, they can come down to three or four,” he said. “As a marketer then, which one do you want to partner with? Obviously, the one that has an open door policy that wants to partner with you and let everyone benefit as a result.”
Ad viewability, fraud and programmatic’s promise
One thing Mahlman agreed hinders industry development is inconsistency around ad viewability, fraud and programmatic trading. While Oath is working with a number of third-party verification players and industry bodies to improve the situation, he also called for a more unified approach.
“It reminds me of the time in the late 1990s when adserving was an issue: Every deal you ran was using AdForce, or DoubleClick and a mix could mean a discrepancy of 15 per cent. It slowed down the rise of digital media because we were making it too difficult for advertisers to work together,” he said. “Verification companies need to get it right, because it’s a big piece particularly in the era of trust.”
Mahlman is also keen for further innovation in the programmatic advertising space. One idea is evolving the supply business away from real-time bidding and to a ‘futures’ market, much like the financial market systems available today.
“There is blockchain technology that helps with transparency for advertisers but also allows them to start creating bidded segments for future buying schedules that locks in that inventory. It still allows it to be run in a programmatic manner,” he said. “Because of the way things are being served out it’s actually creating a latency to achieve this. But we’ve definitely started building on the side ways we can evolve the business.
We’re trying to find a simpler message with Oath. It’s not about the technology, it’s the audience. And we have the audience
“If I think about a market like Australia, we could then be in a position with some of these technologies to start to root out inventory no longer considered real. And what if we could get to a point where you have a true supply/demand marketplace with these brand partners?
“We want to accelerate through our R&D to stay a step ahead of where we are.”
Meanwhile, one thing Oath has done in Australia and the US is roll out header bidder technology that allows a bid to be determined before it hits a DSP’s waterfall and served from the server rather than the webpage. This cuts down latency issues as well as costs.
“Three months ago, we rolled it out in the mobile app world and it’s becoming the forefront of how developers want to have ads served,” he added.
Stop the confusion
Whatever path Oath takes, one thing Mahlman agreed the adtech industry as a whole needs to do is stop confusing the market.
“Every time I give a quarterly business review with Verizon executives, I’m usually talking about a new platform part of the business. While our executives find it very exciting, their advice is to stop the confusion,” he said. “They’d have more confidence in the programmatic world but with change happening so frequently, it’s hard for an executive to stay up to date.
“We’re trying to find a simpler message with Oath. It’s not about the technology, it’s the audience. And we have the audience.”