At the Netric/Rubicon Project Automation Summit, we caught up with one of our event speakers - Katherine Lundin, Programmatic Business Manager at Scream Mediabyrå. We asked Katherine about media agency business models, GDPR and what’s happening right now on the Nordic programmatic market – here are her answers:
For those who don’t already know, can you tell us a little about Scream?
Scream is the largest independent agency in Sweden. Our five founders launched the company with the benefit of many years’ experience of the Nordic market already under their belts. They had a clear picture of the most urgent needs and gaps in the market, that weren’t currently being met by other agencies. For example, you had the big agency groups coming to the Nordics, trying to pitch global solutions that were not possible in this market.
We try to be an entrepreneurial company, and we’ve already had several other startups launch out of Scream, to address some of these gaps. This allows us to expand our expertise, as well as encourage cross-promoting people across all of those different businesses.
There has been lots of talk in the industry lately around the media agencies’ business model – what’s the latest thinking around how agencies charge their clients?
In the industry we work in, constant change is a fact of life. And we would all be a lot better off if we could just get comfortable with that.
On that note, what used to be standard practice – media agencies charging based on percentage of media spend – could well be on the way out.
For a while now, brands have been complaining about percentage fees resulting in a lack of transparency. Not to mention increasing the potential for undisclosed rebates and arbitrage. But it’s actually the consultancies moving into this space that is finally causing a major shift. Accenture for instance just announced its programmatic buying arm, saying it will charge by the hour instead.
Going back to the Swedish market, our advertiser clients are major companies, but not on the scale of say a P&G or Unilever. In other words, it might not suit them to bring everything in house – they still need agencies, and there are always opportunities if you’re attuned to their needs - there are still lots of ways to offer new, valuable services, while also encouraging greater transparency.
What is the latest thinking on the agency side around how you trade programmatically – are private marketplaces still strong?
PMPs are definitely still really strong here. The Nordics individually still don’t have loads of quality publishers, like the US market. It is still feasible to have 1:1 relationships, and brands like to be part of those agreements. I would also add that with ads.txt, we’re hopeful that the open marketplace becomes even more open, and trust can still continue to grow there too.
What is your take on GDPR, and how it might affect programmatic media buying?
What’s still unclear right now with GDPR is just how many people will opt out of targeting. We hear in the email/CRM sector, the opt-in rate is only 10%. For cookies, the figures aren’t in yet for how it will play out – will we also lose 90% of our targetable audience?
Looking ahead to post-GDPR, we have been preparing for a greater shift towards contextual targeting for a while now. To be honest, we’ve had our doubts for a while now anyway about the quality of 3rd party data.
The good news is all of this puts publishers in a much strong position – especially if others also move to targeting around content rather than behaviour. It will require publishers to be more transparent about data, but in different areas perhaps than they’ve been used to – away from the user, towards the page.
Any other predictions around what we might see in future?
In future, I can see a closing up of the market here, as elsewhere – with even higher walls going up on those walled gardens.
If the end result of all of this is we can no longer frequency cap effectively, or holistically reach audiences, or provide relevant communication to an opt-in audience GDPR will have created a much worse user experience. However, I am optimistic that much of this will be solved in time. It is a great time for brands to organize around the usable data they have and begin working in customer or user focused ways.