Will Margiloff is CEO and Founder of IgnitionOne. Here he discusses the current fragmentation in the online advertising landscape, why consolidation is inevitable, and the how a "complete stack" approach will help marketers better manage media spend and drive performance across all digital marketing channels.

The fragmentation of online advertising is stifling innovation. This is a problem for everyone in the online advertising ecosystem.

Because we’re all feeding the industry increasingly indulgent treats (the infamous landscape slides say it all), marketers are navigating the technology landscape instead of focusing on strategic initiatives and leveraging data insights more effectively.

The result is an overly complex system that prevents marketers from realizing the full potential of digital advertising, and arguably prevents online advertising budgets from growing as quickly as our industry would like. It’s high time we tackled the issues impeding progress and tamed the ad tech beast.

We need to move away from this complex and crowded landscape of ad technologies, and towards more centralized online marketing solutions that deliver higher ROI for marketers.

Irrational Exuberance: Ad Tech Edition

Consider the current technology available. Marketers have to find their way through a convoluted maze of disparate offerings from dozens of companies, each with their own way of handling, reporting and managing data. That’s a lot to stay on top of, especially if you are a marketer and not a rocket scientist, which one might argue is the type of person smart enough to understand the maze.

The result is that those marketers who want to move towards a cross-channel approach to digital marketing are left to figure out integration on their own. They don’t have time to think about the possibilities of having all their data working together because they’re too busy stitching and band aiding all the pieces together. They’re faced with testing the array of solutions providers in each category, because that’s what the industry encourages.

This is exactly why the companies who will win out in the end are the ones who streamline the process of managing, measuring, and optimizing online ad performance across all channels. These companies enable marketers and their agencies to spend less time on manual tasks and more time on driving strategic innovation, which is a good thing for all of us.

Not convinced of the challenge facing our industry? Here’s a quote from Forrester’s Joe Stanhope, which so nicely articulates the current problem marketers face:

Marketing organizations have historically acquired point solutions to fulfil specific pain points. This technology accumulation strategy has a critical downside. Managing disparate technologies not only drains resources but eventually becomes an obstacle to optimizing customer experiences and accountability.

The rapid advancements in ad technology (fuelled by exorbitant VC funding) have created enormous innovation in our industry, but we’ve reached a tipping point when the benefit of new systems no longer outweighs the obstacles they present.
So where do we go from here?

The Era of the DMS

Marketers need a singular hub for reaching their audiences. The vision of a central hub for online advertising is something that a number of companies are working towards, including IgnitionOne with our Digital Marketing Suite (DMS) or Adobe with their recent string of both technology and services companies.

Much like Henry Ford’s innovation of the assembly line which brought disparate functions together into one organized process, marketers need the DMS to create clarity from the chaos, and simplicity from complexity. Ford’s assembly line pumped out cars at 50% of the cost and in 1/8th of the time, putting millions of cars on the road. It also put over 250 car manufactures out of business who didn’t adapt to this wonderfully simple innovation.

‘Not another technology solution category to add to the landscape slides?', I hear you say. I’d be lying if I said no. However, the inclusion of this one allows for the elimination a number of others, making it look a lot less chaotic. A DMS aligns search, display and social media activity, giving marketers the information they need to qualify the traffic they’re getting, and continually improve performance with the right kind of insights.

Often analytics platforms are removed from optimization and performance-improvement capabilities. But a DMS can deliver insights that reveal how audiences are responding to different messages across channels, and automate those insights to improve cross-channel performance. In real time.

The DMS in Action

When IgnitionOne was hired by a global travel insurance provider to increase online orders with a centrally managed search and display program, we looked for data-driven insight.

Research revealed that 65% of the insurer’s online customers were exposed to the brand via PPC, Display, SEO or Facebook more than once before converting, with the average customer having more than five media exposures prior to conversion. Because customers typically needed to be exposed to the brand multiple times before converting, we had to find the optimal combination of exposures that would drive the most efficient return.

We scaled the brand’s existing search and display campaign to drive a larger, qualified audience of potential customers to their web platform. Then it was a case of optimizing ad creative and the website to improve relevancy of messaging to different audiences, ensuring high online conversion rates.

A centralized campaign measurement approach with custom attribution model and reporting, allowed for more informed budgeting and forecasting across channels. The results saw revenue increase by 75% while adhering to CPA and ROI targets. Orders then grew 50% year-over-year.

Clearly a holistic understanding of the interplay between all online media helps marketers make more informed decisions about budget allocation and marketing messaging. The DMS provides these holistic insights and allows them to be immediately actionable because it centralizes analytics, attribution and optimization across channels in one integrated platform.

Ultimately, we’re all working for the same thing. For brands and agencies, we want to improve their marketing results. And for our industry, we want to grow the digital ad pie.

All that marketers and advertisers want is to reach their optimal audience, convert them, and leverage data to do it more efficiently next time.

The only path to long-term success is mutual success. Only by bringing the pieces together and helping marketers find more efficient ways to achieve their goals can we all move forward.