The Dark Side of Programmatic Buying


Short and on-point from my business partner. Good stuff.

Originally posted on Diary Of A Media Man:

Programmatic digital can be dicey when it comes to getting what you paid for and you should be concerned about fraud, bots, safety, and viewability issues that result in bad outcomes.

A few months ago a prospective client asked me to evaluate a small programmatic buy her agency had executed for her with one DSP. The agency thought the buy was great, given that they drove a CTR of .48%, higher than most campaigns with a CPM of $1.40. On the surface I would agree.

That is, until I looked at the source of clicks report. This was a small enough campaign, just under 10,000 clicks, that a simple scan of the source of the clicks made me question the real value of the campaign. Many of the URL’s were from out of the US (Belgium, Brazil, Malaysia to name a few) but his was supposed to be a US…

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When it comes to start-ups don’t fall for “If you build it they will come”

If you build itWorking with start-up and early stage companies is interesting and full of unknowns and yes that’s the fun part of the challenge!   What almost all startups share is a passion for excellence, a cool idea and real business potential. Most importantly startups need to show that they have a deep understanding of their revenue models. Having a clear revenue model does not assure (or insure) success. It does however afford investors and potential investors that a business plan (a too-fast fading endeavor) has been developed.

Experienced direct marketers will know exactly to what I am referring. The marketing of services as opposed to products are very different challenges. Both require well thought-out revenue models. To boot, when it comes to the overall enterprise viability, the same rules apply, i.e. The cost of the product or service, the cost to acquire a customer, plus the cost to operate the enterprise in contrast to the lifetime value of the customer.

This week I read an interesting piece on the blog, which covers the VC industry:

The (mis)interpretations of CLTV to CAC

In this guest post, Sapphire Ventures’ Rajeev Dham and Nino Marakovic dive into what the customer lifetime value to customer acquisition cost ratio actually means for a company’s ability to be profitable and successful.

My first thought is that it is hard to believe that startup companies might not inherently know that there are evidence driven ratios between cost and sell.. It’s scary too. In direct response marketing for a product – a sale to cost ratio of at least 4:1 or 5:1 (there are rare exceptions of course) are minimal baseline ratios that are used to determine if a product has a chance at success.

To be overly simplistic, you invent something that costs $5 to make and ship to a customer. The sale price of that item needs to be more than $20 in order to create consumer awareness and sales for the product (Advertising and Promotion). That’s just for starters. Can you motivate the customer to become a multi-buyer? That is either multiple purchases at the same time or multiple instances of product purchase etc.?   If you are only able to sell your product for twice or three times the cost to produce and ship you most likely do not have a sustainable business model and you should go back to the drawing board or find something else to do.

Service businesses are different since the length of the customer’s tenure (LTV again) is more critical to the enterprise’s overall success.   The idea may be cool but that does not mean it will make a great business.

With TV shows like ABC’s Shark Tank many more people have been exposed to the idea of entrepreneurship and what it takes to be successful – at least according to Shark Tank. What many of the participants trip over is their revenue model. That and their (too often unrealistic) view of their own company’s enterprise value (hint: enterprise value is only as good as what someone would actually pay)!

There is only one Facebook. Even Twitter continues to work on its revenue model. The idea of “If you build it, they will come” is a cop-out when it comes to developing a realistic revenue model that merely indicates a chance for success.


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If you don’t want to be happy you’ll get there

Having written this post nearly five years ago, I still I say this often. It’s no less true today than it ever has been.  I never intended to suggest being blindly positive and ignoring reality in the face of adversity or worse.   I am suggesting that those that strive to not be happy (it’s disturbing how often you can notice this behavior), your success rate will be nearly 100%.

If you don’t want to be happy you’ll get there.  Maybe I say it too often at times. By nature I am an optimistic and positive person. I have issues dealing with people that are negative and feel compelled to take those around them to a lower level. Wallowing in your own misery will definitively not make ‘it’ better.

In business you meet all kinds of people, some good and some not so good. When you are building a great team the single most important thing is to create an environment of positive attitudes. When people are positive and happy, they interact with one another better, think better and the output is better.

There are times in business as well as in life when you might be dealt a lousy hand. Perhaps you are dealt a series of lousy hands. It happens to everyone. Without attempting to see the world through rose colored glasses, maintaining a positive attitude in the face of adversity offers a much better opportunity for a positive outcome.  It does not mean everything will be all right, yet it’s worth the effort in my view.

People that react to stress and their own misfortune by trying to take everyone else down with them never succeed in making it better for themselves or anyone else. After a while a person’s unhappiness becomes a habit and in some misguided and twisted way, fulfilling – or so that person may think.

I’ve a good friend who frequently mentions the difference between those people that make it better and those that do not. It’s easy when things are going well to be happy.  What you do when you are having a bad day at work is what separates the professional from the unprofessional.

How do you handle things when it’s raining lemons?

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Do Americans really want to Trump-ize their country?

donald_trump_mm_150616_16x9_992I’ve been ruminating on writing about the phenomenon known as Donald Trump for a couple of months now.   I write about marketing, consumer attitudes and behavior, and technology and its impact on our lives – at least for the most part. For me, Donald Trump has become too compelling a story to not write about, especially as it pertains to attitudes and behaviors of my fellow Americans.

I will plainly state that when it comes to Mr. Trump I am decidedly not a fan. OK, now that those people who will read no further have left, I will offer some reasons I think people are attracted to the current poll leader for the 2016 Republican Presidential nomination.

Because Mr. Trump is a multi-billionaire he does not have to adhere to traditional campaigning approaches such as civility and discussion. Add to that the notion that as a billionaire he is not beholden to anyone and can truly call things as he sees them with all honesty. He can speak his mind and say the things that (supposedly) many Americans are thinking but never say. Speaking without a self-imposed filter can appear to be intoxicating since, well, nobody else can really do it and expect to function in society. So right on Mr. Trump – keep telling them the way you think it really is, and the way you think it should be!

Earlier in the summer I considered Mr. Trump to be akin to that page-turning trashy summer novel that you feel guilty about reading but for some reason cannot put down. With the second Republican Presidential candidate debate last night we were able to finally see a few layers peel off of the Trump-onion. It’s up to you to determine if anything really happened that revealed something we did not know about Mr. Trump during the debate. Mr. Trump continues to offer little in the way of specifics other than ‘We’ll make America great again’ and things like ‘I’ll make good deals for America’.

It’s difficult for me to accept that Americans really want Mr. Trump to run the United States in the same manner as he presided over The Apprentice show on the NBC television network. It’s safe to say that up until this point diplomacy, as far as Mr. Trump is concerned, begins with “You’re fired” and goes downhill from there. That’s entertaining on a television program, however I have a hard time picturing Mr. Trump interacting with Chinese President Xi Jinping and saying, “You know what China? You’re fired!”

I won’t begin to explore Mr. Trump’s history as it pertains to deals he’s made except to offer that I really don’t relish the thought of having as President someone who readily uses bankruptcy as a business tactic.   U.S. Presidents and world leaders don’t get do-overs nor do I think citizens want them to have to try.

There are elements of Mr. Trump’s campaign that are positive and that starts with challenging the traditional political hyperbole and trying to replace it with plain- spoken honest discussions of real issues and concerns. This is the reason Mr. Trump has resonated with so many Americans for far longer than I would have thought was possible. His campaign has disrupted the Republican establishment, which can only be a good thing for the party and also the county in the long run.

Summer’s just about over now and so ends the trashy novel reading season. However the final chapters in Mr. Trump’s 2015 summer novel have yet to be written.

How do you think this story will end?

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Why won’t Amazon give up on hardware?

Fire_HD6_Hero-970-80Since Apple had their big fall announcement yesterday regarding the new iPad and iPhone updates/features, as usual the hardware news belongs to Apple and not Amazon. In a recent report Amazon did sort of not announce that this holiday season it MAY release a $50 six inch tablet. If it works anything like the Kindle Fire (of which I am a first generation owner), it’s likely to be less than wonderful.

I neglected to mention that my Kindle Fire’s recharging port stopped connecting and the device is now dead in the water. That is until or unless I replace it myself (a 15 minute how-to-fix-it-yourself video convinced me to not bother and I don’t have a working soldering iron anyway).   That Kindle Fire device never worked that well as anything but an e-reader as far as I am concerned.

I also should remind those of you that don’t know that I am a big fan of Jeff Bezos and in general. When it comes to distribution of consumer goods, hosting and deployment of business services and innovative ideas Amazon is a brilliant company.   When Amazon tries to be a hardware company it almost always fails miserably. The original Amazon Kindle was cool and innovative (pre-iPad mind you) however Amazon has been chasing its tail (and Apple and Android) ever since when it comes to consumer hardware devices. The Original Amazon Kindle was the best device it ever has made. Remember the Amazon Fire phone?   Didn’t think so. That was so 2014.

It’s not surprising that Amazon would have the desire to provide hardware devices in order to control the user experience as much as possible. From a business perspective there’s great motivation to create as closed a system as possible.

Do Amazon’s continued consumer hardware problems hurt its brand image? I think the answer is a definitive YES. Personally I know few if any people that have positive experiences with Amazon consumer hardware. For the record very few people I know HAVE Amazon devices.

The expression ‘those that ignore the past are destined to repeat it’ applies here. So why does Amazon keep trying?

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Under-18 student data should be sacred

PF FlyersWhen I was really young I really believed that PF Flyers would make me “Run Faster, Jump Higher!), and had I had the ability to purchase I would have purchased as many pairs as possible. Fortunately my mother knew better particularly about the running faster and jumping higher thing. Just over two months ago I wrote a post in which I suggested that use and sharing of non-sensitive customer data on a macro level is not something to be cast aside without thought. An NY Times article that appeared in the New York Times this past Monday caused me to want to be more specific about when it is not acceptable to use or share data to influence an audience.

Students under the age of eighteen should not have be subject to personalized marketing pitches based on their behavior. There have to be limits and remember that as a marketer and consultant I have a deep aversion to giving up revenue models.

The article states, “In May, Georgia adopted a law barring online services designed for elementary through high school from selling or sharing students’ names, email addresses, test results, grades or socioeconomic or disability information. It also bars them from using the data to target students with ads.”

Leave it to The Peach State to be a leader in simply doing the right thing. And this is about as slam-dunk a concept as there is today. It’s one thing to make the mental adjustment understanding that marketers will forevermore serve advertisements based on your behavior and preferences as much as can possibly be done. We’re all adults and since the dawn of advertising, adults have eventually (sometimes longer than others), realized what is a pitch versus an unbiased offering if there is such a thing.

It’s not that there isn’t value in gaining understanding in the data and behaviors of under-18 students. There’s great value, which can be used to create better pathways to learning and development. When there’s confidence in the validity of data you can believe in the historical evidence regarding trends, behaviors and actual preferences of students.

What you should not be able to do is market to those students on the basis of their behaviors. Development of young people happens at varying rates and steering the behavior of young people before they’ve had an opportunity to develop their own opinions and beliefs is a very dangerous path on which to embark. If you believe as I do that diversity of opinion and choice is critically important then surreptitious steering of behavior is watershed.

The bottom line is that students (i.e. children) have not lived enough to be categorized and marketed to as groups.

Sharing under-18 student data for marketing purposes – JUST DON’T DO IT!.

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Should being the best version of yourself be your ultimate goal?

Rise of’s Jeff Bezos has been taken to task over a recent article that appeared in the New York Times. A follow up article on August 18th h suggests a brewing debate over work culture. In my view it’s long overdue.

The seemingly never-ending quest for the highest efficiency is seductive for any leader of any business. That makes sense from a strategic perspective, right? ‘Optimizing Everything’ (perhaps that should be the title of Mr. Bezos’ next book).

The drive for efficiency and optimization transcends business and has entered our personal lives with tracking devices meant to monitor one’s health and physical activity. Monitoring your health and fitness is of course all in the interest of helping you improve your performance. It does not end there since for example, continuing education and learning surely adds to your ability to be effective. Eating and drinking the right food and drink are other ways in which personal performance can be improved.

Outliers are the kinds of people that truly drive the human condition to higher performance and heights. In Steven Kottler’s interesting book “ The Rise of Superman” among other things he explores the thoughts and habits of people that ‘push the envelope’ above and beyond where it has been before. Clearly human achievement advances in large part not from the masses but from these outliers. It also must be understood that MOST people do not fit the category of ‘Superman’. And there’s nothing wrong with that!

This brings me to my question – how far will non-‘Supermen’, (Superpeople just does not work) people be willing to go to create the best or even Super-version of themselves? The answer is it depends on the person. Individuals need not be concerned with their own place in the pursuit of their optimal selves. The Outliers always help define what is in the middle.

Amazon’s work culture appears to be hyper-competitive and the weeding out reminiscent of Jack Welch’s ‘fire the bottom 10%’. In an environment of continual performance optimization Amazon’s pushing of the envelope is not surprising and not necessarily altogether wrong. That hyper-competitive environment is not for everyone and when employees are hired at surely they are aware of that into which they are buying.

What Mr. Bezos and his compatriots cannot do is have it both ways. cannot be the hard-driving, high-stakes company it has demonstrated it prefers AND be warm and fuzzy and a wonderful place to work where everybody holds hands, gets amazing compensation and perks, and employees also have substantial flexibility on how, when and on what they work.

Amazon can try to come back to the middle a bit from its Outlier position as sometimes too much is….just too much. Being the best version of yourself you can achieve is a good overarching goal.  It’s also exhausting!


Posted in Best business practices, Personal Development, Professional Development | Tagged , , , , | 2 Comments