Publishers’ obsession with CPM is diluting ad effectiveness claims Pandora digital ad guru
The man responsible for innovating internet radio service Pandora’s advertising products has called on advertisers to change the way they measure their ads, saying the current definition of ‘viewability’ for digital ads is not good enough.
Jack Krawczyk, vice president of advertising product management for the internet music streaming service, told Mumbrella the idea of “advertising as a function of space” was leading to publishers creating less value for clients.
During a hangout with Mumbrella he said the current definition of viewability, defined by the IAB in the US as 50 per cent of the pixels in an ad being viewable for one second, is “necessary for now given people were selling ads that weren’t actually seen,” but needed to be addressed.
Listen to the hangout here:
“What’s great about a lot of these viewability packages is they actually measure the amount of time the ad is in view,” he added. “So as you look at you can start to compare what was the performance of ads that were in view for 15 or more seconds, and how does that compare to those visible for ten seconds, and what about those one to five. So we’re actually gathering the data set to understand the importance of attention as it pertains to creative execution.
“The world is inevitably going to move towards a world where you’re paying for the attention your advertising generates, and not necessarily just the binary reach – was it seen, was it not seen.
“That’s going to be a really exciting step forward for the ad space. Right now if I’m getting paid on a CPM (cost per thousand views) structure my incentive is to create more space and create more pageviews, which from an advertiser’s perspective since a you’re being paid to dilute that share of voice.”
He said attention, not time, needed to be the metric advertisers looked at in the future.
“If we move to a world where ads are bought for the attention they are generating then you can’t create more time. Our attention can only be divided consciously into one thing at any one time. What that does is create an incentive for the publisher to create a more meaningful experience for their end users.”
During the wide ranging discussion Krawczyk spoke about how the company is using the data it generates from its 250m global users, and talked about some of the pitfalls they had experienced in targeting. He also spoke about the need for brands to tailor their creative to the platform, rather than just use radio ads.
Timeline of questions:
- Intro
- 2.30: Data – do you know much about your users?
- 4.25: Can you extrapolate consumer details for advertisers?
- 6.30: What does the average listener look like?
- 7.10: How do you refine the data?
- 8.30: Targeting, location-based targeting and how effective is it for advertisers?
- 11.00: What targeting is working best?
- 12.55: How is new tech changing the way you think?
- 14.35: Do they change user behaviour?
- 15.25: You are working with car manufacturers?
- 17.00: I find the ads interruptive. What is being served up?
- 20.10: Are people getting to grips with how they should be advertising?
- 22.15: Display ads, click through rates
- 26.00: Viewability. Are the industry standards good enough?
- 28.00: You were a disruptor. But what are you worried about/looking over your shoulder
- 29.00: Australia is well served by streaming services- how many services will people subscribe to?
Appreciate you taking the time yesterday for the interview and sharing your perspectives on the local market! One thing I’d like to call out is that I’m not responsible for the innovation myself — we have an amazing team of engineers and product managers in Oakland, CA who actually drive our core innovation across personalizing the advertising experience and generating attention at a scale higher than anyone else… I just have the fortunate task of being able to be in Aus this week and sharing that story 🙂
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Can you guys do your audience a favour by dispensing with the hackneyed, time wasting preamble and get straight to the guts of these interviews. It would be a point of differentiation from traditional media, and would make your hangouts a lot more useful.
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