Sue Hunt, Improve Digital, managing director, UK, explains that while innovative ideas and venture, plus eager VCs can enrich the industry, the downside is that such a pairing can result in a perception of need spreading confusion, and potentially restrict the quality of inventory that publishers trade programmatic.

While innovation has its place, she argues it must be underpinned by stability and scale to reflect a need, rather than unnecessarily creating one.

Advertising technology has long had a history of innovative start-ups and big dollar acquisitions, all fuelled by organic growth, a relatively low barrier to entry for new players and the deep pockets of corporate America.
Looking back to 2007, Google spent $3bn acquiring DoubleClick (who had already acquired TangoZebra), Yahoo snapped up Right Media and some of us may still remember the $6bn bank busting Microsoft acquisition of aQuantive (incorporating Atlas and Accipiter)? Withstanding the question of where are they now…?!

The programmatic space may not see such spectacular figures but the VC money continues to flow, spurred on by a string of successful IPOs in 2013 including Twitter, Criteo and RocketFuel. Not to mention the big name acquisitions including WPP’s purchase of Crystal Semantics and BannerConnect, Accenture snapping up Acquity, Yahoo and, well….

Meanwhile, 2014 doesn’t look set to buck the trend with Oracle entering the fray recently to snap up BlueKai, Adobe and Salesforce rumoured to be limbering up, plus Rubicon’s S-1 already filed.

These high profile sales have obvious positive impact - raising the stature of the industry, stimulating further investment, diluting the dominance of the corporate power houses by creating strong competition, and giving us all something to read (and write!) about.

Competition is great for innovation and overall industry development, customer choice and provision of bespoke solutions, and is no doubt contributing to the double digit growth programmatic trading continues to enjoy.

However, we do risk the negative impact of a fragmented ad technology sector. Too much choice can cause confusion, potentially restricting the quality of inventory publishers make available and the spend marketers allocate to digital, let alone programmatic.

We see new players entering from every angle, capitalising on continuing growth. This includes the long established real-time ad serving model (exchanges, SSPs, DSPs) and specialist demands within video and the growth of mobile devices. Now the increasing need for data management platforms; improved optimisation techniques; brand safety and ad viewability; social media, are leading to the emergence of new emerging buzzwords including programmatic premium and native advertising - which will inevitably create a new perception of need.

In a sector where technology and platform are central to trade, it is somewhat inevitable that complexity creeps in. We have all seen an abbreviation we neither understand nor feel comfortable to ask to be defined.

Many of us have stared at a lunarscape of cluttered company logos we can barely read let alone claim knowledge of. This does point to a tendency to add complexity for complexities’ sake. If this only serves to create confusion and fear, and therefore restrict rather than encourage trade, then it is a downside rather than a further catalyst for growth.

Investors and shareholders will always welcome and support innovation, growth and market development, but that needs to be underpinned by stability and scale, and reflect a need, rather than unnecessarily creating one.

Customers should always do a thorough needs analysis of their business and due diligence of every existing or potential partner and their competitors; ask for references, expect first class service and support, and learn from industry counterparts.

The expectation of IPOs still to file and additional funding is high, with Pubmatic and Turn leading the pack respectively. As much as 2014 may see some consolidation, it certainly won’t see any fewer transactions or dollars flowing through our sector, requiring a clear focus on the core business we trade and objectives we pursue.