Programmatic Paves The Road For Mixpo’s Local Video Ads
Cruze Control: Mixpo's ad creation and delivery tools were used to support individual Chevy Cruze dealerships, as it evinces greater opportunity building in hyperlocal.
General Motors debuted the 2011 Chevy Cruze compact sedan about three years ago. At the time, the car company wanted two distinct things from its online advertising: a clear demonstration that its ads influenced purchase intent; and a substantial ROI that would represent at least 10-percent of the digital ad spending.
While GM’s ad expenditures on the Cruze is undisclosed, the company is regularly one of the largest top two advertisers in the US, spending roughly $2 billion a year on ads – and digital advertising generally represents a quarter of that total budget.
First, the two Seattle-based marketing companies had to produce video ads individually tailored for each of 2,900-plus local dealers; second, they had to determine which of several creative ad examples had the highest impact with certain segments for more precise targeting.
Third, and most importantly, they had to execute a campaign quickly and within tight budget constraints.
Strict Marching Orders
Cobalt, which analyzes consumer data from over half of all US auto dealerships, reasoned that it would be impossible to meet such stringent requirements using traditional rich media methods – they were too costly, too slow, and too inflexible.
“Whenever a user goes to a dealership site, Cobalt drops a cookie to remember that consumer,” says Lanctot, the Razorfish veteran who was named Mixpo’s CEO in October 2013. “We were able to use that data, incorporate it into our site, and integrate it with our mix of video ad distribution platforms. Plus, we could leverage the insights Cobalt already had to target these ads at users who’d visited dealership websites. Ultimately, we used geo-targeted messaging that was specific to their location and that the vehicle that they had interest in.”
The ability to geo-target the creative and messages for the individual dealers satisfied GM’s demand for ads that were customized to its local outlets and the need to target in-market auto buyers at scale.
Plug And Pay
It sounds easy, which is exactly what Mixpo intends.
“Our position is to be really easy to work with in terms of how we use data that our customer might have,” Lanctot says. “The other approach we take is to make our platform really easy to plug into other existing systems. So, we built enough APIs so we can just plug into the workflow of other video platform companies like Videology or Brightroll or AOL’s Adap.tv.”
The video ad space is both increasingly lucrative — Digital video ads command $4 billion today, according to eMarketer — and increasingly crowded. But Mixpo has standout characteristics. For one thing, it’s strictly a software/platform company: it isn’t focused on buying or selling ads; it just works with publishers and agencies/marketers by creating video ads, then providing the pathways to serve the placements directly on certain sites to specific consumer segments. It also offers tools for reaching consumers on social media and the analytics to show whether a campaign met its objectives.
Moreover, Mixpo is primarily interested in making video ads work across screens and devices, as opposed to primarily aiming its wares at either connected TVs, the PC-based web, or mobile separately.
For Mixpo, the rise of programmatic advertising (the use of automated systems to target and deliver advertising) is making the idea of cross-screen media buys more mainstream.
Competition? No Worries.
“Our thinking is that programmatic obviously is kind of started with remnant inventory and very performance-driven advertisers,” Lanctot says. “As better and better inventory is made available through programmatic channels — which is already happening — it’s natural that the advertisers want to have more sophisticated targeting and more dynamic advertising that they show to users.”
While the rush to use programmatic tools to reach consumers no matter what screen they’re looking at would seem to diminish Mixpo’s value, Lanctot believes the company’s position at the center of other players’ needs — whether its an analytics provider like Cobalt, or a video ad marketplace operators like BrightRoll or Videology, on to video-focused demand side platforms like TubeMogul – will continue to ensure its relevance.
“We’ve long said, ‘Let’s not try and compete with a Brightroll or Videology,’” Lanctot says. “Let’s just make it easy to plug our platform or our creative studio into their work flows. We’ve already started doing that and it’s been really well received because we aren’t worried about having a jump-off point where you have to go to Mixpo and come back to Videology. It just seamlessly plugs in and that’s worked really well for us.”
Local: Huge But Complicated
By automating the targeting and ad placement demands of agencies and marketers, programmatic ads can encompass a hybrid of opposing poles of low-cost direct response and the richer, more emotionally stirring work associated with brand awareness ads.
By widening the palette of options for advertisers from DR to brand affinity, the chance to get more granular in marketing to consumers has also allowed companies like Mixpo to get more local – a previously untapped area of the digital marketing landscape.
“Local is an excellent example of what Mixpo can deliver, because it does take advantage of our dynamic and interactive capabilities,” Lanctot says. “I wouldn’t say it’s the sole focus, but it’s definitely one of the best use cases we have and it’s also in the area where there’s tremendous interest in the market. Local continues to be seen as a huge opportunity in digital, but one that is very complicated and because it’s complicated, nobody has owned the market yet.”
Lanctot points to Internet radio player Pandora and location-analytics provider Placed as two companies he feels have worked extensively to expand the value of hyperlocal advertising. (For the record, while Mixpo works with Pandora, it doesn’t have a formal relationship with Placed.)
“We see real opportunity in working with companies like Pandora, which are building up their sales teams in local markets competing with radio,” Lanctot says. “Placed has great momentum because they have that local in-store data. If you can show that exposure to those location-based ads lifts in-store visits, that’s what the bottom line of advertising has always been.”