Understanding Programmatic Buying and Real-Time Bidding, with Jay Friedman.

Speaker 1:

If you’re going to take the risk of running an agency, shouldn’t you get the benefits too? Welcome to Build a Better Agency, where we show you how to build an agency that can scale and grow with better clients, invested employees and best of all, more money to the bottom line. Bringing his 25 plus us years of expertise as both an agency owner and agency consultant to you, please welcome your host, Drew McLellan.

Drew McLellan:

Hey, everybody Drew McLellan here. Welcome to another episode of Build a Better Agency. I am excited today to chat with you and to bring to you Jay Friedman. Jay’s going to talk to us about programmatic buying and real time bidding in the digital paid media space. But before we get there, just want to remind all of you that the reason I’m doing this is like you, I still own my agency, I’ve been doing that for about 20 years.

And I also run Agency Management Institute where I get to work with over 200 small to midsized agency owners every year, helping them both mitigate the risk of owning an agency and hopefully maximizing the rewards that can come with owning an agency. And really I’m starting this podcast because I want to be able to extend that work beyond the folks that I get to work with face to face.

And so it’s my privilege to bring different experts to the podcast to talk about issues of topics that I know as agency owners and leaders in an agency you are hungry to learn more about, which is exactly why Jay is here with us today. So in 2006, Jay joined the Goodway Group, which back then was a print driven marketing and promotions company.

He was hired specifically to launch the digital division of that company. So the owners saw the writing on the wall, knew that they needed to evolve their business, as many of us have talked about and brought Jay in to do that. In 2010, Goodway served its last print customer and decided to completely focus on the digital side of the business.

Fast forward to 2015, Goodway has more than 200 clients and works with many agencies, big and small across the country, as well as some clients direct, has I believe over 260 employees, which fascinatingly enough is almost all completely virtual, so they’re scattered all over the country, and is one of leaders in the programmatic and real time bidding paid media space.

Jay as an expert in this arena is also very generous with his time as you will experience during this podcast in sharing his expertise with others in the industry. He certainly is a nationally recognized and accomplished expert and speaker, writer and author. You’ll find him often at some top industry conferences writing for lead industry publications and websites and he’s even written some books.

Some of his latest books are the seventh edition of 30 Days to Paid Digital Media Expertise, and that book by the way comes with a companion guide specifically written for agency owners, and also 30 Days to Mobile Marketing Expertise. So with all of that, Jay, welcome to the podcast.

Jay Friedman:

Thank you so much Drew, it’s a pleasure to be here.

Drew McLellan:

It’s great to have you. So strange as it is in 2015, I know that there are a lot of agency owners that are sort of wrestling with the digital media piece. So when they hear phrases like programmatic buying or real time bidding, I think sometimes it sounds a little bit like the Snoopy and Charlie Brown teacher, the wa, wa, wa. So give us a basic definition of what we’re talking about when we’re talking about those things.

Jay Friedman:

Programmatic, like you said, gets a real scared reaction from a lot of people based on a lot of misinformation, but it very simply put is a set of technologies that automates the buying placement and optimization of media.

Drew McLellan:

And real time bidding is tied to that how?

Jay Friedman:

So realtime bidding is a subset of programmatic. Programmatic in and of itself is again, just an automation of what we’ve been doing for a hundred years. And it’s automated typically through an interface and it makes it easier rather than having to print something, sign it and fax it back, it’s now available to sign in an interface, also often enables agencies to optimize their inventory and what they’re buying on a faster basis.

But RTB or real time bidding is just a subset of that, and again has just as many, I guess, misnomers or whatever it is as programmatic does itself. But you can do programmatic without doing RTB. Of course, RTB is a very strong and well functioning marketplace around unsold inventory for publishers of which there is a ton. There are 40 plus billion impressions a month.

Drew McLellan:

Okay, so-

Jay Friedman:

Or I’m sorry, a day.

Drew McLellan:

So part of that is about kind of bargain shopping for your clients, right?

Jay Friedman:

So it could be looked at that way, but I would say that it is for valuing an audience as much as, or more than just the content that it’s in. And so while it could be bargain shopping, I guess at the same time, going and spending $10, 1,000 buying from a publisher direct that has 50% of its inventory unsold, I don’t know if it’s called bargain shopping if you’re going to get it for $3 or if it’s just simply called overspending, going getting it for 10.

Drew McLellan:

Right. Right, right, right. There you go, fair enough. So for agencies who are just beginning to dabble in the digital media space, so they might be interfacing with Facebook directly, or they are going out to one of the big ad servers and buying. Talk to me about how that’s different than what you guys do or what you teach agencies to do?

Jay Friedman:

Yeah. So I think the way agencies have typically looked at things is to say, all right, where do we want our ads to appear? So do I want to go to my local newspaper or do I want to go to ESPN or WebMD or Facebook? And what programmatic does is it flips that around and says, who do you want to touch? Content and context is important, it’s not irrelevant.

But the user is more important than the content or context alone. So if you prioritize and you put user first, then put contextual wrapping around it and say, “All right, I want my user, but let’s not have them in these contexts because it’s not only not relevant, but it’s perhaps distracting,” you end up getting a much more resonating message than if you just go out and say, “All right, I’m comfortable knowing that it’s in my local newspaper because that’s where my client and I look.”

Drew McLellan:

So give me a real life example, walk me through, give me a for instance.

Jay Friedman:

Sure. So real easy example, because I know a lot of regional agencies have a car dealership occasionally that they have as a client.

Drew McLellan:

Sure, yep.

Jay Friedman:

And so going and putting… So you think, all right, a car dealer, let’s say it’s Louisville, Kentucky, you think, all right, well, I’m going to put it in the local paper, on their website and then I also am going to buy some cars.com or maybe some Autotrader, for example, because that’s where car shoppers are, which is true.

But Autotrader or cars.com or Edmunds, those are all very expensive properties. Most of them are bought out at the national advertiser level at least for the good spots. And so what we do is we say, let’s flip this around and let’s realize that you are trying to target people who are beginning to look for a car in Louisville, Kentucky. Where do we find those people?

And then we have all sorts of data sources that both predictively model and behaviorally follow users who are either about to be in market for a car, or who have just recently shown that they have entered the market to buy a car. And so the key there is that if you show the right user an ad, but that ad is on let’s just say cnn.com, right? Well, that dealer doesn’t have the money to go hit the minimums on CNN and it wouldn’t make sense for them to buy a rotating slot on CNN.

Drew McLellan:

Right.

Jay Friedman:

But if we know that that user is a prime user, and this is generally algorithmically driven to a degree partly based on, or sometimes just based on past browsing history, but being able to buy one impression at a time for the right users, as long as they’re in a reasonable and respectable context is just flat out more effective than going the site based buying method.

Drew McLellan:

So how, if an agency has been buying based on… I’m buying sites, I’m buying ESPN, I’m buying my local newspaper, my radio rep through some online ads in with my radio buy, all of that, how do they move, how do they educate themselves and move to this more sophisticated buying model?

Jay Friedman:

So this is… I wrote out enough of steps here that if I were an agency owner as part of your group that I would take. So number one is to find a partner you trust. And I know you mentioned how can this be brought in house, and I’ve got a friend named Amy Recker who is a consultant to agencies and brands on bringing programmatic in house.

Her guideline is unless you have 15 people dedicated to running your programmatic media practice, solely dedicated, not names on an org chart that will touch it, but that’s a hundred percent of their job, if you don’t have that many, then you shouldn’t be doing programmatic in house.

Drew McLellan:

Well, as you know, I’ve got some AMI agencies that have brought it in house. And when they started, they had a small handful, 2, 3, 4 but you’re absolutely right, they very quickly have scaled up to that 15 or 20 person department to try and manage the labor intensive work that it is.

Jay Friedman:

Right. And, and if I were to go into detail, which I won’t because it’s long, but just around the amount of work we do with data processing around all of the data that we get for our billions of impressions that we serve a month and the eight people we have dedicated to that, there generally are not regional agencies that can dedicate that type of resources to it.

Drew McLellan:

Right.

Jay Friedman:

So I would say, and of course there’s exceptions to every rule, but for 97% of the agencies that you’re going to come to contact with, I would suggest that finding a partner that you trust is number one. And so I want to walk through a few quick ways to do that.

Drew McLellan:

Okay, great.

Jay Friedman:

So number one is demand content and contextual transparency. So if you’re going to work with a partner, it’s your data, you have every right to know every impression that every… Or every site that every impression ran on, what hours of the day, what days of the week, what browsers, what devices, what operating systems, every programmatic vendor has all of that, that is nothing that should ever be hidden.

And so I don’t care what sales people give you as the reason, if you’re an agency owner of why that’s not possible. Well, our publisher contracts prohibit that, not acceptable. It’s an open fact now that you can get all of that data. So number one is to demand transparency. If you can’t get there, end the conversation.

Drew McLellan:

Okay, good advice.

Jay Friedman:

Number two is understand their motivation. Now, I don’t think this is all that different than frankly, than forming a deal with a new client or any other vendor. But in ad tech and programmatic, so many of the vendors are venture capital funded and looking to go IPO at some point.

And so it’s important you understand what their company goals are, again, just like any other vendor. But I think it’s a little bit more acute in this space because of the space we’re in and the timing that we have and the way the market is and the valuations.

Drew McLellan:

Right.

Jay Friedman:

So understand their motivations, what is their support structure, for instance, the ratio of support people that they have to sales people. Because you’ll often get a salesperson and they say, “Yep, I am dedicated just to Northeast Louisville.” It’s like, wow, that sounds great. But you find out that they then have to go home and run the campaigns. Well, that’s not good.

Drew McLellan:

Right.

Jay Friedman:

And then of course, I would look at the ability to customize what are their minimums on campaigns because I think for a lot of regional agencies, sure you have that 20 grand a month campaign, but you also have two others that are 3 and $5,000 and you don’t want a partner who’s going to say, “Well, I’ll take the 20, but not the other two.”

Drew McLellan:

Right, right.

Jay Friedman:

So those are just what to look for, I think in a partner. I think as you’re talking to these prospective partners though, look at the media you’re buying today and determine what media can be bought programmatically. Most of it can. Radios around the corner still, there’s a little bit of TV.

And of course, if you need to be in true print, then that’s not something that’s generally programmatic. But any digital, medium, and even the print that is driven by tablet and even radio if Pandora or Spotify is acceptable to you, it’s amazing how much can be bought in programmatic nowadays if you just look at it that way.

Drew McLellan:

All right. Any other steps or is that-

Jay Friedman:

No. And then the only other step is just a reminder, going back to what we discussed before. As you’re talking to your partners or the vendors or publishers or anybody, you do have to think audience, audience, audience because if you’re-

Drew McLellan:

As opposed to media outlet, media outlet, media outlet.

Jay Friedman:

Exactly. Because if you are still in that media outlet mindset, you’re really going to get hung up a lot and you’re probably going to become frustrated.

Drew McLellan:

Well, and I think one of the things we forget about when we have our agency hat on is how we behave on the internet. So yes, you might go to ESPN, but then you’re also on Facebook and then you’re on your local newspaper website, but then you’re also on a knitting website or some other hobby website that we as human beings have a pretty broad and varied set of interests.

And so as I understand, with the tools that folks like you and your company have available to you, you have a pretty good idea of where I Drew McClellan am bouncing around from a Scrabble website to ESPN to check on my Dodgers score to wherever else I may be going and can sort of track and follow me where I go.

Jay Friedman:

Yeah. I mean, we don’t know obviously your name or-

Drew McLellan:

Sure, all right, yeah.

Jay Friedman:

Fingerprint or anything, but we know that the person who’s been sitting behind the browser that you use has gone to all of these various places. And I think also if you just mentioned how we use the internet ourselves, it’s amazing how much we don’t remember. If I had a logging device on any of your listeners’ computers and at the end of the month, I printed out every unique website that they went to, I bet you, at least a third of those, the people would be shocked, “I don’t remember going there,” or, “I’ve never even heard of that.”

Drew McLellan:

Right.

Jay Friedman:

But you click out on a link from Facebook to a funny quiz or an article or something and it’s amazing how many domains we go to that we don’t recognize. And so when you see that in your RTB or in your programmatic plan, your instinct is to say, “Well, this is no good.” But then you realize, no, you and so many other people do indeed visit those sites.

Drew McLellan:

Well, sure. Because we have to find out what our spirit animal is, or whatever the quiz of the day is on Facebook, right?

Jay Friedman:

Let’s do it. Praying mantis, come on.

Drew McLellan:

That’s right. So for agency folks who are listening to this and are a little anxious about the topic, how do they… And I will say, I will give an unrequested but firmly endorsed, the books that the Goodway folks put out, the 30 day books are awesome. They are written for agency folks, they are easy to understand. They don’t assume you know anything. And best of all, the Goodway folks are happy to share those with you at no cost.

So at the end of the podcast, Jay is certainly going to be giving you some contact information. So if you have interest in the books that he mentioned or that I mentioned in my intro of him, I know he would be happy to get that to you. So beyond your own books, where are other places or ways that agency owners can get themselves…

Because oftentimes agency owners are not digital natives and all of this is a little bit foreign to them and a little frightening, how do they get themselves and their team educated enough about all of this so that they can talk to clients about it?

Jay Friedman:

Yeah. So I think everyone is looking for that website that I can just go read every day and I’m going to come away in a couple weeks just knowing programmatic.

Drew McLellan:

Wouldn’t that be awesome?

Jay Friedman:

And if there is a website like that, the closest thing to it would be AdExchanger. So A-D exhanger.com. Very, very solid website. John and the guys over there and Zach and everybody, they’re very smart and put together a good product. That’s the closest thing there is to it. But it’s going to take a while.

And if you’re not familiar with programmatic, you’re going to probably have five questions a day just going through it. I think as part of the take action plan that I’d like to give everybody toward the end of this discussion, I have a way for users to get more educated while at the same time finding a good partner to do it. So we can certainly go through that now, or we can wrap up with that.

Drew McLellan:

Yeah, no, no, no, let’s go through that now.

Jay Friedman:

Yeah, so what I would walk away from, or if a user’s listening to this, what I would hope they walk away from is in finding a partner, first, I would recommend having a strong handle on the platform and service providers that are available in the market, Goodway is one and there’s 30 others.

So if for nothing else, certainly you can go to AdExchanger and read up day to day and see which ones you’re hearing about. You can also, of course, look at the LUMAscape, L-U-M-A-S-C-A-P-E. It’s a little bit limited in certain parts and very, very strong in others. But I would have a handle on the platforms so that you know the universe, that’s number one.

Number two, then call people like us or people like Centro or people like MediaMath and invite us in to go over how we work with agencies like you. The third step is to not believe anything that any of us say in that presentation. We are as good as any industry at telling a really great story.

The people that you hear things from, again, whether it’s us or anyone else, take note of what interests you and then ask them to verify and validate what they have done with real data. So I once had someone explain to me that they literally update every impression that their ad server sees and serves with an algorithm that identifies the exact probability of conversion and matches it with a value.

And I’m like, “Great, show me part of that algorithm.” You don’t have to show me the whole thing, it’s proprietary. Or show me 10,000 rows of data or impressions pre algorithm, post algorithm. Show me the difference, I want to see it at work. I mean, what I think people get carried away with is the stories that we have in this space sometimes seem so fantastic, both in a good way and a bad way that we let ourselves believe them and then we kind of kick ourselves for not doing the gut check or the hard investigation on the backend.

It’s doable. I had talked with a provider one time who told me that they scrub out all of the Centro data which you can look that up, it’s a long story. But from latitude, longitude information within mobile, I said, “Prove it to me. Show me your database, show me the initial raw log that came in and then show me what you scrubbed and why.” They did, I believed them.

Drew McLellan:

Right.

Jay Friedman:

And then the final thing is, I would say you need to test for culture and service. We work with vendors in a variety of areas as well, even down to the who provides our servers or whatever. And at the end of the day, culture is as important, if not more important than the claims and everything that are made in the presentation. And the reason I say that is because no matter how fantastic the claims are, if you get to working together and it’s difficult and you can’t get your clients what you’ve promised in a timely manner, then none of that other stuff matters.

Drew McLellan:

Amen to that. That’s for sure. At the end of the day, it’s your reputation that you’re putting it on the line every time you partner with somebody. So you want to make sure you’re partnering with somebody who behaves towards clients and clients work the way you do so that you have that in alignment.

Jay Friedman:

Exactly.

Drew McLellan:

Yep, absolutely. So again, for a lot of these folks though, even if they go through all of that, the world in which you and your competitors live is still pretty foreign to them. How do they learn… So I’m an agency owner, how do I learn or how do I teach my account service people how to talk to clients about this and how to know when this is a good or right solution to talk to clients about? How do agencies learn how to do that?

Jay Friedman:

Well, I think the first step is to accept that programmatic media buying can be your default for anything that’s programmatically viable. So if it’s digital, mobile, video, audio, whatever it is. I remember 10 years ago, I was listening to someone speak somewhere and they said, “Imagine if you approached your next annual plan and you said, ‘Let’s take TV off the table.’ What comes next? What do we do next?” And I think for the majority of clients at that time would’ve been digital, today, there are a lot of clients that put digital on the table first.

Drew McLellan:

Right.

Jay Friedman:

And so I think to your point, taking programmatic and saying, “Why should programmatic not be first?” I’m not saying it’s going to be. But asking yourself that question, sometimes it just is a matter of considering it and remembering that it’s there and that makes you go, “Yeah, you know what? We don’t even have to be in RTB, or maybe there’s some that’s right for RTB and we do want to buy our local newspaper, but we can buy it programmatically, which means we can pick the impressions we want with more accuracy and with better targeting.”

So I would say number one, consider it first. Number two, read AdExchanger and MediaPost and all of the other publications. And then third, in order to educate, I really would kind of go through the take action steps that I just outlined about calling the vendors. I’ve done a number of education sessions for regional agencies around the country, and they always learn something.

Obviously it’s best if you don’t call people like us in just to learn with no promise of ever working together but I’ve done a lot of these education sessions and they’ve led to a lot of great partnerships that have good trust and a solid foundation around them.

Drew McLellan:

And is it reasonable for agencies to expect vendors like you to continue to educate? So my agency and Goodway now have a relationship. Is it reasonable for me to acknowledge A, that your world is changing at the blink of every eye and B, I as an agency owner, am never going to be able to track all of that? But the that’s your job. So you’re going to help keep me educated and help me prepare presentations for clients and all that. Is that all in what’s reasonable?

Jay Friedman:

Right. So I think that goes into the expectation setting up front when you’re finding a partner.

Drew McLellan:

Right.

Jay Friedman:

And so I can tell you that if an agency came to us and said, “Hey, look, we’ve looked at everybody. We really like what you offer. We’re going to place the majority of our programmatic through you. It’s not that we’re never going to use anybody else. But in exchange for doing that, and this isn’t so much legally contractually bound, but even on a handshake, but we’d like you to bring us information about the industry and innovations, and we’d like you to help us in new business pitches and even if it’s not always directly to your benefit.” We do that all the time.

Drew McLellan:

Right.

Jay Friedman:

All the time. We have probably 50 relationships with regional agencies around the country where we do exactly that.

Drew McLellan:

So it’s reasonable to look for a partner that will help you in those ways.

Jay Friedman:

Yeah, absolutely. And I think that if you get down the road with a partner who you are spending good money with, and you’re treating as a partner, but they’re not partnering back, then you got to look at that relationship again and reevaluate.

Drew McLellan:

Right, right. So from an agency sort of culture and education point of view, when you look across the spectrum of your clients and you look at the agencies that are really knocking it out of the park versus the agencies that are struggling in the whole digital media buying area, are there commonalities amongst the ones that are doing well with it that are making good money, that are helping their clients achieve great results? What do they have in common?

Jay Friedman:

So I think the ones that have… I would say one thing that all the ones doing it well have in common is this ability to get to the important parts about working with a partner and finding a partner, which are trustworthiness and motivation, integrity, and transparency more than I need to understand every aspect of programmatic before we can work together. Does that make sense?

Drew McLellan:

Yeah. It’s sort of like you don’t really want the surgeon to explain exactly what they’re going to do, you just want to trust that they’re going to cut in the right place.

Jay Friedman:

Exactly. And so I would say that the agencies that we work well with and that are not only retaining the business they have, but that we see easily going out and pitching new business are in a way surgeon salespeople. They’re going out and we provide them with a lot of ammo and we provide them with a lot of information.

We make sure that they know the information we’ve given them backward and forward. But when they get to that pitch, if the client asks them something that they don’t know, they’re not scared and they don’t shy away from it and they just say, “You know what? This is such a complicated industry and we have a ton of experts. They’re not all in this room right now, but anytime you have questions like that, we can come back and get you the answer.”

Drew McLellan:

So it’s funny as we’re describing this surgeon salesperson, it’s exactly what agencies want from their clients, right?

Jay Friedman:

Exactly.

Drew McLellan:

They don’t want their clients to micromanage them, they don’t want to have to explain why they move the pixel from here to here.

Jay Friedman:

Exactly.

Drew McLellan:

They do want their clients to have faith in them and trust in them and know that they’re doing what’s in the clients’ best interest at all times, right? So it makes perfect sense, but isn’t it funny that we as agency owners and agency leaders struggle with having that same trust relationship with our vendors? But it’s probably a great reminder of why it’s difficult for our clients too. It’s very scary to trust someone who’s doing something for you that you don’t understand.

Jay Friedman:

Yeah, I totally agree with you but I think that is at the end of the day, the only way it actually ends up working.

Drew McLellan:

Well, and you know what? I’ll bet you everybody who’s listening is nodding their head when they think about the clients that they love to work with, and those are the clients that trust them and don’t ask them… It’s not that you don’t want clients to ask questions.

Jay Friedman:

Correct.

Drew McLellan:

But you don’t want to have to explain every nuance of every decision, right?

Jay Friedman:

Yeah. I would go so far as to say, I don’t mind explaining every nuance to any question but what I don’t want to be as an agency owner, I don’t want my client to expect that I have that information always at my fingertips at the moment.

Drew McLellan:

Right, right.

Jay Friedman:

And so what I want agency owners to feel confident with with their partner especially, I mean, if it’s us, is I can get the answer to any question you have, and the answer I give you will be really smart, but I don’t always have that answer right at the ready.

Drew McLellan:

Right. So I think one of the reasons why a lot of agencies struggle with the digital media buying and partnering with someone like you guys is we’re used to being the experts. And for many of us, we’ve been doing this for a long time and we really do have a great depth of expertise in a lot of this stuff. And so I think one of the reasons why a lot of agencies shy away from the digital media buying or they just sort of close our eyes and hope is that it’s pretty uncomfortable to not be the expert.

Jay Friedman:

So I would agree with you. I’ll say a couple things around that. As marketing and technology get closer together, because now you’re looking at needing big data knowledge and SQL or no SQL or Spark, or Hadoop processing knowledge to deal with the amount of data that an enterprise generates.

Drew McLellan:

Right.

Jay Friedman:

I don’t ever expect an agency owner to be an expert in those softwares or that field.

Drew McLellan:

Right.

Jay Friedman:

I don’t think that’s… And so this is where it’s going. It’s going to hyper specialization, and what’s important is that you have hyper specialization people that you can always call and get the answers you need. And so I think the world’s changing, all I can tell you is from our experience, the agency owners that want to know it all before it into it are the agency owners that have stayed very small.

Their businesses have stayed very small and they haven’t stayed small on purpose. And the people who say, “You know what? I’m confident. I feel like I’ve got a great partner. I know you’re there to back me up. I’m going to go sell this thing,” they’re the ones who are growing and retaining clients with more use.

Drew McLellan:

Well, I think a lot of agency owners and when I meet with agency owners or I’m teaching a workshop and I ask them to introduce themselves and tell us a little bit about their agency, the phrase that everyone, regardless of if they have two employees or 150 employees uses is full service agency, right? And so I think part of what is evolving in the agency model is I think agencies need to recognize that A, when they say full service, in the client or the prospect’s head, immediately the phrase I don’t think so comes to mind.

And B, that in today’s world, to your point with technology and all of the things that are going on in the marketing space, it is nearly impossible to actually have everything under one roof. When I started in the business we had a librarian on staff who did research for us.

And I started at YNR and we had video folks and we had amazing resources that in today’s world even the big shops don’t have anymore. And certainly if you’re a shop of 150 people or less, there’s no way economically you can have every subject matter expert you need to run your agency on behalf of your client in house. And so we have to get more comfortable with acknowledging that we may, as an agency drive the strategy and the vision and the business of that client’s relationship, but we have got to lean on some partners.

Jay Friedman:

You know what? It’s really interesting. I saw an article, how can agencies adopt the Airbnb model or the Uber model?

Drew McLellan:

Right.

Jay Friedman:

And essentially not owning the inventory or the resources directly, but owning the strategy and the client relationship. And that really resonated with me because the agencies that we see doing the best take that to heart. They own that relationship and they own the overarching strategy. But the specialists that they use whether it’s with tech or with printing and promotions or with digital, whatever it is, that’s not… They don’t worry about owning that. They see that as the Uber ride or the Airbnb overnight, not the technology and the relationship.

Drew McLellan:

Yeah. That’s a great analogy. And I know agency owners are struggling with it, but it’s some place we all have to get to because we’re not going to go back to 1992, right? That’s just not going to happen. So if we want to evolve and if we busted a hump to survive the ’08 recession, if we have that killer instinct in us, we also, I’m hoping, have the instinct of survival that will allow us to evolve to this sort of hub and spoke model where we are the hub but boy, we better have strong spokes all around us that deliver all of these areas of expertise that are outside of our wheelhouse.

Jay Friedman:

Yeah. And I think if you look at the holding companies and what they’re doing, they’re doing that and now they’re of course keeping it in house, but a YNR of today or a Grey of today, or a Leo Burnett, they don’t have all that in house, but they have 50 other companies within the holding company that do specialize in those things. And if you are Procter & Gamble or whatever, that may be fine, but for the universe of clients and agencies that we’re talking about, this is the model that is helping people succeed.

Drew McLellan:

Yeah, absolutely. So beyond having the trust factor, what does an agency need to do to be a good hub for the spokes out there? So let’s flip it around. I’ve been asking you what you need to do to be a good provider. From an agency’s point of view, what do we need to do to be a good client? So again, whether it’s a PR firm that’s doing a specialty, or it’s you guys, or somebody else.

Jay Friedman:

Sure, exactly.

Drew McLellan:

What do you guys look for in an agency partner?

Jay Friedman:

Well first, it would be great for agencies to want to pay as much money as possible, but we have to caption that.

Drew McLellan:

Of course.

Jay Friedman:

No. So yeah, there’s a couple of things here. I think in the programmatic space what we look for are agencies who make it easy to be smart and to deliver great results. And the way to do that is so going back to our what outlet versus what audience, the agencies that come to us and talk about the audience they want to reach first, man, that makes it so much easier.

Drew McLellan:

Sure.

Jay Friedman:

And it’s not just for us, it’s easier to deliver a plan back to them that they can show their client that they love. So that’s one example. I think to our point before accepting that they don’t know everything about programmatic, but wanting to learn and understand, but if they decide that they do want to learn and understand something, really being willing to learn and understand it and not just doing a short term memory storage. And learning it instead of memorizing it, I would say is a follow-up to that. I see a lot of agency folks that memorize answers and they get caught up on the next question because it’s inevitably a follow-up.

Drew McLellan:

Right.

Jay Friedman:

And then I would say the final thing that makes… Well, there’s two more things that make it really great for an agency or for us to work with an agency. Number one is knowing and being willing to really poke and prod the client to get to the real goal of a campaign.

Drew McLellan:

So give me an example of what you mean by that.

Jay Friedman:

So I can’t tell you how many times we work with an agency and we say what’s the goal? Let’s say it’s a local water park or it could be a car dealer. Well, we’re just looking for people to know we’re here. It’s like, okay, well, how are we going to measure that because-

Drew McLellan:

Right.

Jay Friedman:

Because digital, and maybe what I’m trying to say here is people who understand that digital is measurable, but it’s not magical.

Drew McLellan:

Right.

Jay Friedman:

And so let’s think ahead to the end of campaign report or even the first 30 day report that we’re going to deliver, what needs to be in that report, such that you, the agency are really excited to show it to your client? There isn’t really any way to show that lots more people now know we’re here.

Drew McLellan:

Right.

Jay Friedman:

Similarly though, when people say, well, we’re just looking to sell cars or we’re just looking to get people through the door, it’s like, okay, well again, digital’s measurable, it’s not magical. What are the essentially intermediary goals or intermediary steps that we can measure? So going back to the car dealer example, we can’t measure cars sold easily if it’s one dealer, but what we can measure is how many users did we end up getting to the site regardless of whether or not it was a click?

How many of those users ended up looking at your inventory, new versus pre-owned? How many ended up filling out a lead form? How many looked at specific inventory and not just general? So there’s a lot of things that we can tell that directionally tell us how we’re doing. And then for larger clients, there are some really great ways that you can measure true offline success, whether it be through credit card swipe data, or name matching on the back end.

There’s some great stuff we can do, but you have to have realistic goals, helping us get to those is great. And then the final thing is when an agency accepts the fact that their client won’t (blank). Well, our client won’t let us place a pixel on the website. Well, our client really won’t let us look at their sales data or our client won’t let us have their database.

And that may be true, I don’t know, but I can tell you that is the beginning of where relationships and where I see client agency relationships starting to end. Because if you don’t have full trust and full access, then you’re not going to be able to give them the results that match their expectations.

Drew McLellan:

Well, and a lot of times I think it’s about helping the client understand why you need or want that access, whatever it is and what you’re going to do with it to show them how they can then merchandise through their organization success, right?

Jay Friedman:

Exactly.

Drew McLellan:

So it’s, look, if we have facts, A, B and C, then when we give you a month end or quarter end or year end report, we’re going to be able to show you X, Y, or Z, which you can then take to the CEO and go, “This is what I did with our marketing budget.”

Jay Friedman:

Exactly. That’s a great point.

Drew McLellan:

And I think sometimes especially agencies that have been more about brand or traditional creative shops who have not been asked to really sort of prove their value, and one of the things that we hear loud and clear when we talk to CMOs and some of the research we do is those days are over. The CMOs are now being forced to document what was the ROI for every marketing dollar you spent.

And so they’re looking to us as agencies and going, “Okay, I gave you $1, $10, $100 million, it doesn’t matter the amount, what did I get for that?” And I can’t just show them a board of pretty ads. I need to be able to say, we drove this many test drives, or we did this, whatever it is.

Jay Friedman:

Exactly.

Drew McLellan:

I have to be able to quantify to some degree, to some end goal, what we did with the money. And so what you’re saying makes perfect sense, that for you to be able to deliver that, agencies have to be willing, need to go back to their clients and say, “I know that you said that either you don’t have access to this, or we can’t have access to this, let me show you what we want to do with it,” and revisit that conversation.

Jay Friedman:

Yeah. I think if… I mean, if you’re Coca-Cola and you’re going to spend $20 million on a campaign, you want to know how much more Coke you’re going to sell, or at least how much Coke you’re going to sell that you around sales you would’ve otherwise lost.

Drew McLellan:

Right.

Jay Friedman:

That has to be quantifiable. And I think to your point, and I think all of your listeners will identify with this, the smaller the client, the more hyper focus they are on getting exactly what they want out of it.

Drew McLellan:

Right.

Jay Friedman:

And so we’re not dealing with $20 million budgets where yeah that may be a rounding error, we’re dealing with $100,000 digital budgets or what it may be. And around that, we have to do that. There are agencies calling up and pitching your clients every week.

Drew McLellan:

Absolutely.

Jay Friedman:

Right? So what do we need to do and how can you as an agency help us as your expert partner deliver stuff? Well, we need to know exactly what we need to be judged on when it comes to success.

Drew McLellan:

Well, and I think that’s a lesson, again, back to our conversation about agencies having to evolve. That’s an uncomfortable reality that we all have to get comfortable with in a hurry, that we have to be able to help clients measure and create metrics around what’s working and what’s not and adjust accordingly so that at the end of the budget quarter, campaign, whatever, we can say here’s what happened.

Jay Friedman:

Exactly.

Drew McLellan:

This is fascinating and I could keep talking, but I want to be mindful of both your time and our listeners’ time.

Jay Friedman:

Exactly.

Drew McLellan:

So I want to move towards wrapping up.

Jay Friedman:

Sure.

Drew McLellan:

So you gave us early on in the podcast, some very actionable items. So normally I wrap up the podcast saying really want some tangible things, but you did that already so that’s awesome. Are there any sort of last thoughts or comments that you want to leave the listeners, the agency owners and their leadership teams with in terms of partnerships or programmatic buying or anything that we’ve talked about today?

Jay Friedman:

I think the last thing I would say is really to follow up on what I just touched on, but didn’t really go deep into, and that’s that there are other agencies calling on your client every week. One, are you happy? Are you happy? Would you like to invite us in? And so it’s always one of the…

I’d say the most rewarding thing in everything that I do is when I hear that we have delivered an agency results and a plan and intelligence around something that makes their clients say, “I can’t imagine a leaving you.” And so as it relates back to programmatic, programmatic is not an option anymore. It’s not something that I would recommend you look at if it’s a fit.

I would look at it, I think as you and I have talked before 48% of eyeball and mind share time is now digital whether it’s phone or desktop or whatever it may be. And that continues to grow because if you look at how we’re watching TV and especially how younger generations are watching TV, it’s not linear over the year, it’s over the top.

Drew McLellan:

Right.

Jay Friedman:

And so if you have an agency that you still want to be relevant and awesome 10 years from now, this isn’t for someone who’s looking to sell out in the next 12 months, but if you want to be awesome 10 years from now, it is time now to start thinking about defaulting to programmatic, maybe maybe not always RTB as the way you buy digital and buying non programmatically as the exception.

Because the case studies that we can give, that partners like us can give agencies like those in your group to help pitch for new business are so compelling and strong. So I want your listeners to be able to have those case studies and experience themselves, rather than it being a competing agency that works with a competing partner that someone who competes with us to get some super case study to go pitch a client, and the client goes, “My current agency’s never given me anything like this.”

Drew McLellan:

Right.

Jay Friedman:

And so-

Drew McLellan:

I get some of that.

Jay Friedman:

Exactly. And so that’s… I guess my parting words are, I want to make sure that your listeners never are caught off guard saying, “Well, we were thinking about it,” when their client comes to them with something new.

Drew McLellan:

Yeah, I think the day of maybe we’ll go digital or maybe we’ll be in the digital space is long gone and agencies need to… If they’re not already on that train, they better hop on in a hurry.

Jay Friedman:

Yes, agree.

Drew McLellan:

Awesome. This has been great, Jay. So if people are trying to track you down and want to follow up with you, want to get a copy of one of those free books that I mentioned earlier, how do they find you?

Jay Friedman:

So best way is always email [email protected], just like it sounds, goodwaygroup.com. You can call my cell phone. I’m on the phone all day usually, and sometimes traveling, so it’s hard, but 214-693-1965. You can of course visit us at goodwaygroup.com. And if you don’t mind about half of the tweets being about soccer, you can follow me on Twitter at J-A-Y-M, as in Michael, Friedman, F-R-I-E-D-M-A-N.

Drew McLellan:

Your soccer or kids’ soccer?

Jay Friedman:

No, about professional soccer.

Drew McLellan:

Ah, okay. All right. Awesome.

Jay Friedman:

I split it. So none of my followers are actually very happy. The soccer followers are annoyed about all this programmatic junk that I post and vice versa.

Drew McLellan:

Well, you know what? As we said earlier, we as human beings are complicated and have lots of layers so I guess our Twitter feed should do the same, right?

Jay Friedman:

There you go.

Drew McLellan:

This has been great. Thank you for your time. Thank you for sharing your expertise. I appreciate it.

Jay Friedman:

Of course.

Drew McLellan:

And I know that all the listeners appreciate it as well, so thank you.

Jay Friedman:

You got it. Thank you so much.

Speaker 1:

That’s all for this episode of Build a Better Agency. Be sure to visit agencymanagementinstitute.com to learn more about our workshops and other ways we serve small to mid-sized agencies. While you’re there, sign up for our e-newsletter, grab our free e-book and check out the blog. Growing a bigger, better agency that makes more money, attracts bigger clients and doesn’t consume your life is possible here on Build a Better Agency.