MediaEquals, an online trading platform for traditional media, is now looking to move into the display market early next year. Farneymedia met with Gary Goodman, CEO Europe, earlier this week to discuss the MediaEquals platform, whether it will compete with the already available ad exchanges and yield optimisers and how the UK display market is likely to fare in the twelve months ahead:

Can you explain how your platform works?

MediaEquals is an online trading platform for all media enabling everyone who buys or sells media to do so in a smarter way. We do this through providing a media trading community, a centralised database that can store and classify all media inventory, a comprehensive suite of Media Trading Tools that both reflect the way business is currently done and provide new ways to trade for the benefit of everyone. Finally moving the deal making to a system provides a seamless flow of data from planning to payment to even reconciliation.

Our aims are to provide a more profitable way of buying and selling media; enhancing relationships by freeing up time; delivering better media solutions with less administration and smarter communication. Crucially this enables everyone to focus on value added thinking and delivering better media solutions to the clients rather than process and transactions. I believe there’s never been a better time for a technology driven solution to help transform the media industry.

Why did you set up MediaEquals?

I started working as junior media planner buyer for Universal some 18 years ago. This was at a time before the internet and Microsoft Excel had just been introduced into the agency to manage media plans, replacing graph paper and pencil. Our buying team of six shared one computer between us. I spent six hours a day on the phone, checking availability, optioning space and haggling to get the best rates. I spent the other two hours a day uploading what had been agreed to the DDS DOS interface, resolving disputes on what had been agreed.

The next 14 years were spent client-side. Over this time the media landscape had radically changed. As a client I was demanding more compelling, data-driven media solutions. When I came back to the media world it was as an online publisher five years ago. Despite the fact that now there was a PC on everyone’s desk, I was amazed to see how everyone was still buying, selling and administrating media for clients in exactly the same way as before. I set up MediaEquals with a vision to create a Bloomberg style trading platform, to enable everyone to buy and sell media more efficiently.

Why did you start with press and what other media sectors are you planning to cover?

Our goal is to be the home of all media. Our technology has been developed to hold and classify everything the market wants to buy and sell across all media categories and all audience segments. For our launch, national press and consumer press were a natural starting point as these are the core areas under most pressure to find smarter ways to do business.

Our premium online media channel will be available early next year. Out of home and broadcast (radio and TV) will follow. This will enable publishers and buyers to package up and agree cross-media deals or focus on specific audience buys.

How does your platform benefit publishers?

Media Owners can sell to more buyers, faster, in a secure environment. On top of the meetings, telephone calls and email we provide a central online community of media buyers for publishers to connect with, in real time, on their terms, to provide not just more sales lead opportunities but better qualified ones.

We also free up time spent negotiating and administering deals to enable every media sales rep to spend more time selling and less time processing orders.

How does your platform benefit agencies?

By providing streamlined services and therefore real efficiencies to the cost of the negotiation and processing of bookings, agencies will be able to focus on providing enhanced strategic and consultative advice (planning) to the client; currently one of the most profitable growth areas in the industry.

We provide existing agency or media owner work flow management systems with automatic activity updates, with real-time access to information across all relevant publishers, allowing buyers to make more informed bookings, across multiple media owners and media sectors. Trading history across clients and campaigns will enable buyers to use historical support for negotiations. They will receive more information, more quickly, from media owners on special deals and features. They will also receive faster responses from media owners on client briefs.

Additionally, our platform is built to integrate with agencies support planning, research and performance measurement tools to a level that has not been possible before.

How does MediaEquals increase efficiency and performance of the display ad media buy?

If you are buying media we help by enabling you to store the media you may want to buy in a plan against specific clients and campaign and broadcast offers or a brief to multiple publishers at the same time, giving them all a set period to get back to you. Over time the data you have access to will help drive your buying decisions based on previous order history and media effectiveness.

If you are selling media you can reach out to your buyers in real time across our community or in our marketplace. Buyers can opt in or be invited to receive your media alerts from you and this live feed enables you to reach out to more buyers more often. Over time we will be able to tell you not only how to maximise your yield but also who to target on our network and what media they are likely to be interested in buying, at what price, by advertiser sector. All of this is to drive liquidity on both the buy and sell side.

In the current climate every penny counts, and we are not looking to minimise the importance of firm negotiation in each transaction. However - we believe that contract rate deals should be processed directly through technology we provide and more effective, positive and profitable relationships can be formed. A key benefit of our service is that we are able to significantly reduce the administration traditionally associated with media trading. We do this through integrating with booking and workflow management systems - so ultimately there will be no duplication of data entry, and agreed trades will feed directly into DDS or its equivalent. We also have advanced report management tools which can improve audit trails. Seamless integration with booking and flat-planning systems saves dual entry and frees up important time. In this way, trading media, both offline and online becomes more efficient.

Media is and always will be a people business. Whilst the negotiation element of the conversation is transacted electronically, the verbal or face-to-face element can focus on brands, markets, consumers, competition and the future - in short, a far more positive sell and a far better buy.

Are MediaEquals looking to compete with the existing ad exchanges and ad display marketplaces?

My feeling is that direct response advertisers are well serviced by the existing networks and exchanges. They effectively bring together a long tail of buyers and sellers to reach an online audience. There will no doubt be quite a bit of consolidation in the market.

The winners will be those networks and exchanges that can best optimise campaign performance from the real-time data they hold.

What we do is actually very different from how the ad networks and exchanges operate. We are all about improving the process of how media is bought and sold rather than creating a secondary market. Our focus is on smarter negotiation tools rather than automation of the buy. We are all media rather than just online.

Have any publishers or agencies signed up for the new service?

I think both publishers and media agencies are realising that change is not just desirable, but essential. Our trading platform has been developed with the help and direct involvement of media owners and agencies. This “ground-up” approach has been an essential requirement to ensure we deliver a service our customers find useful.

Our vision is to represent the world's most important media owners and principal agency groups, so our focus is only the serious players for now. The top six media agency groups account for just over 50% of all media bought. The top 30 global media owners account for approximately 57% of total media. Within these, the top 10 media owners account for over 35% of all media sold.

For a $400bn market there are actually a handful of companies that have real influence to enable a trading platform like MediaEquals to reach critical mass. I am not saying it is easy and as with every new business the key is focus on doing something well and building from that base.

Initially this has been on national and consumer press for the UK, to be followed by premium online early next year. Publishers currently using our system include Bauer Media Group, Guardian Media Group, IPC Media, BBC Magazines and Metro Newspapers. For each media brand we have loaded everything they sell on the platform and agencies are now rolling out clients and campaigns to use the platform to trade.

Could the MediaEquals platform be described as more of a tool for direct sellers and buyers to negotiate price on top-tier inventory – rather than an automated ad trading platform for unsold ad space?

It’s important to emphasise that we are not an online ad exchange for unsold or ‘distressed’ space. A few companies have dabbled in our space before developing media exchanges for traditional media sectors. The problem with exchanges is that this suggests there is a level playing field where buyers can compete on equal terms for media. The consequence has been that media owners have only used these services to sell distressed and narrow interest inventory, and agencies have not supported them.
Additionally, a simple “auction style” exchange is not acceptable to buyers or sellers, because the commoditisation it would cause has been seen as a threat to the agencies, rather than a supportive facilitator.

Our strategy is different. We are not trying to change the way business is done. Our technology enhances existing relationships through smarter communication.

Clearly publishers are concerned about the commoditization of their ad inventory, but could this platform develop into a futures market, where price and volume is agreed months in advance of the campaign?

The media industry is going through more change more quickly than ever before. The only constant is that publishers will always be looking at ways to maximise yield and media buyers will always be looking for a better value deal.

Publishers are in control of who sees their inventory on our service. This reflects the market today. We provide a smarter way to buy or sell all media. Services like “bid for position” can enable publishers to get higher prices for better quality positions. The ability to let more buyers know in real time of a media offer will inevitably will drive demand and market forces will do the rest.

My belief is that buying or selling hubs that have scale have increasing potential to create secondary markets for media they buy/sell. The key differentiator will be those publishers and agency groups who can harness a competitive advantage of delivering cross-media campaigns, and optimize these for the clients most effectively. To support this the industry need a central place to trade - a media neutral or even “equal” platform - where these cross media deals can be negotiated, agreed and administered.

How do you see the display market developing in 2010?

The majority of ad spend still remains in traditional media including press, television, radio, cinema and outdoor, although the online advertising market is growing and is projected to reach 12.1% globally in 2009. The lines between traditional and digital media channels continue to merge. Many traditional media channels will be digitalized over the next few years. We are already seeing it. E readers like Kindle will be increasingly important to the “print” publishers and outdoor digital screens and interactive TV both already enable ads to be served in much the same way as online. So whilst the buying currency is still pages and spots in some media formats it is likely that audience will be the main currency for everyone moving forward. We are a media-neutral network and our tools can service all buying currencies as they evolve across our network.

The key differentiator will be those publishers and agency groups who can harness a competitive advantage of delivering cross-media campaigns, and optimize these for the clients most effectively.

To support this the industry need a central place to trade - a media neutral or even “equal” platform - where these cross media deals can be negotiated, agreed and administered.

Can you expand on the community-type features you are building which will help buyers and sellers to communicate and network effectively?

Much like Bloomberg has done, we are creating a community of buyers and sellers to enhance their relationships through an online community. For now this enables you to send private messages to each other alongside a briefing or negotiation, upload personal and company profiles, and even to chat to each other online. The aim here is to enhance relationships that have previously been restricted to just offline ways to keep in touch.

Publishers can also able to broadcast special deals to individual buyers who opt in to receive their media alerts. This could be one deal for all or a number of tailored deals to individuals or specific buyer groups. More narrowcast than broadcast then.