Winter is coming for Ad Tech, leaders focus on differentiation, specialization, and verticalization
Years have gone by and the Ad Tech industry has seen a whooping sense of consolidation and obliteration. According to Sloan Gaon, CEO of PulsePoint, ad tech leaders should double down efforts and embrace differentiation, specialization and verticalization if they would want to succeed.
Analyst's forecast less than 250 net operating companies in ad tech in 2020 from over 1500+ companies in 2013. The domino effect of bad debt, ad fraud, technology upheaval and overheated evaluations within the industry has strong armed Ad Tech companies into the ultimatum, differentiate or die on the vine.
Leading brands are moving more into the traditional way of advertising, McDonald's acquisition of Dynamic Yield to create more store walk-ins and drive-thru, trending menu items by geo-fencing or Walmart's acquisition of Polymorph to innovate it's digital advertising and draw more customers to the brand. While the list is endless, Sojern acquiring Adphorus, AirBnB purchased AdBasis. The industry is thrown back to the clear intent of brands looking to adopt, apply and integrate technology with data to effectively create real and transformative changes instead of driving fake acqusitions, MAU's and DAU's over unethically acquired inventories which has created an non transparent and non trust worthy ad tech market.
As Jack Welch says, "Change before you have to". To successfully weather the storm, players should be wise to play a long term way keeping customer deliverable an utmost priority. The compound effect of poor profitability in an overcrowded market has left players to scout for working capitals from various sources by window dressing the balance sheets.
Advertising needs to take into account the diversity of individuals in a generation to avoid being archaic and ineffective. - Dave Asch