Sociomantic Labs, a DSP providing RTB solutions for e-commerce advertisers, are entering the UK market under the direction of new UK Managing Director, Gavin Wilson. ExchangeWire caught up with Gavin Wilson and Sociomantic CEO Jason Kelly to discuss what they feel they bring to the UK market and how their solution is evolving.
Sociomantic are moving into the UK by nabbing someone from the affiliate industry. Is this an indication of the client base Sociomantic will seek to access?
JK: As with all our hires, our interest is always in finding the best person for the job on many different levels, including existing network and industry expertise, as well as cultural fit with our team and a range of other factors. We found this match in Gavin Wilson and we couldn’t be happier to have an online marketer with his experience on board. Gavin has demonstrated that he is not only a great leader and business developer, but has shown he shares in Sociomantic’s customer-centric and service-oriented mentality, which, in addition to his history with performance marketing, will be critical to delivering our solution to our partners the UK market and abroad.
Is the UK large enough to have another retargeting entrant? How does Sociomantic go about dislodging the likes of Criteo who have long been established?
JK: Our experience in other markets has shown us that when all things are considered, e-commerce advertisers are interested in generating more transactions. If a market challenger, such as Sociomantic, can deliver better performance with an innovative product and with higher service levels than the incumbent, then marketers are willing to split or even shift their budgets accordingly. That’s why we continue to invest in our technology and team, to make sure we can deliver the most innovative and best-performing DSP on the market, offering our partners the opportunity to run retargeting and prospecting campaigns supported by the best service and consultation they can find in the industry.
What will Sociomantic bring to the UK market that is different?
GW: I think the primary thing that’s missing from the UK market is a certain level of innovation when it comes to RTB technology. There are a lot of white-labelled RTB solutions and trading desks that can offer the service layer, but not necessarily the technology brawn that e-commerce advertisers need to capture the full value available from this channel. What makes Sociomantic different is our proprietary bidding, ad serving, and dynamic creative optimisation infrastructure, which is integrated in such a way that it basically works as a giant stream of real-time data. Just think about High Frequency Trading, where every microsecond is worth millions and requires the appropriate technical background to drive the best performance. For us, everything is about performance.
JK: On the most basic level, it’s a matter of scalability and integration. Our e-commerce advertisers have a LOT of data, and produce more every millisecond. For example, a single advertiser could have hundreds of millions of product images that we need to stream, and millions of users for whom we need to track hundreds of actions each. That's a lot of data we handle in real-time for each client that we work with, and needless to say it's no lightweight task. According to our supply partners, we manage to do it with some of the lowest error rates of any buyer in the industry, and these rates are even decreasing as demand grows. Of course this technological experience hasn't been grown in one night, and it’s far more complex than plugging together a string of open source software components. It's the result of years of research from our founders that began long before the name Sociomantic existed.
On top of that scale is the ability to innovate on every level of the process. Our customers have intelligent metrics for measuring the value of their customers that go far beyond the next transaction, and it’s our goal to innovate within this channel to help them capture value not just in the short term, but also in the long term, by optimising for customer lifetime value and other CRM-centric optimisation strategies, customised depending on the client. Continued success within this channel is only possible with constant innovation to improve every part of the process in every part of the stack.
Is retargeting a viable solution for e-commerce merchants when solely looking at click-based acquisitions? Many affiliate programmes seem to be willing to accommodate a small element of post-view. Is this critical to success?
GW: e-commerce marketers want to see sales, and the Sociomantic ethos has been to ensure our clients see maximum results, whilst looking at the long-term value of that customer to the advertiser. That’s why we optimise our bidding, targeting, and ad optimisation logics based on metrics like the effective cost-per-action, or eCPA, and bigger-picture metrics like the Customer Lifetime Value (CLV), instead of the old standard CTR. Sure, some clickers are buyers, but many studies in recent years have shown that heavy clickers aren’t always the most likely to convert, so it doesn’t make sense to optimise for only clicks when it’s not the most important metric for the marketers with whom we’re working. Weighting the value of post view versus post click will remain a contentious subject, and understanding the needs of the market is key to succeeding.
JK: We also believe that CPC-based pricing should be less of a priority for marketers. Not only does it deprive the marketer of the pricing efficiencies afforded by real-time bidding, but it also means that the goals of the marketer and the vendor are not necessarily aligned when it comes to things like frequency capping. When goals aren’t aligned, it can not only hurt the campaign effectiveness at driving conversions, but also create negative brand impact when a consumer becomes overexposed. Optimising for the user experience is the point where true innovation starts.
Will Sociomantic need to adapt its approach of 'client direct' in a market so heavily dominated and led by agencies?
GW: Every market is different, and part of the beauty of opening up local service centres is that it gives us the ability to better adapt our solutions and our approach to each individual market. Our mission is to build a transnational organisation and we're not the first ones to say that local markets need local solutions. As we’ve said before, we intend to stay open-minded about our approach and to follow the marketers’ lead in terms of the level of agency involvement.