Cadreon
Erica Schmidt is the new global CEO of Cadreon.
- Erica Schmidt is the new global CEO of Cadreon, the programmatic media-buying division of the ad giant IPG.
- The executive said advertisers are scrutinizing digital ad spending more than ever before and that programmatic has "gotten a bad name." Yet she acknowledged that ad tech has a lot of bad actors.
- She argues that agencies need more than ever to prove their strategic value and likely need an infusion of talent comfortable with data and analytics - and a focus on driving business objectives.
Erica Schmidt this month was named global CEO of Cadreon, the programmatic ad-buying unit within the ad agency giant IPG Mediabrands. Schmidt will focus on accelerating the growth of software-driven, data-infused ad buying for IPG's clients worldwide - just as programmatic
Increasingly, big brands are questioning exactly where their digital ads are running on the web, and how their ad budgets are getting doled out among the ad tech ecosystem's vast stream of middlemen. Some are questioning whether digital advertising is as effective as it's been cracked up to be.
Business Insider caught up with Schmidt to talk about her new mission and taking on programmatic advertising's many challenges.
Mike Shields: At one point, programmatic-buying groups like Cadreon were labeled as trading desks
in the digital ad world, helping make ad-space trade like stocks on Wall Street. Obviously lots has changed in recent years, given the focus on transparency. Where do you see this group today?
Erica Schmidt: At its core, Cadreon was one of the first entrants in "real-time bidding," and we've been in the midst of the growth of all things programmatic. We've done a good job of iterating either in advance of or in reaction to trends. Now, we're trying to lead the drive toward transparency, and we're also trying to play a bigger role in investment decisions and move strategically upstream [in the ad-buying food chain].
One of the core things I'm focusing on is, "How do we continue to see growth and value, and what is that next iteration beyond programmatic?" It's kind of gotten a bad name. We may need to come up with something different.
The good news is that clients have gotten very sophisticated. And they're asking about what more can they do from a data and tech perspective. They know they've got to change. So one core thing I'll be focused on is how do we unleash and catalyze their data.
Shields: What do you make of all this talk about the role of agencies, and whether they are as vital as they once were given the role of automated technology?
Schmidt: Some of our clients have taken the position of, "We'd like to engage with tech partners directly, but we still need you." And we have some who want to engage in different relationships. And others are in the beginning stages of exploring new ways of working.
Shields: What's driving this?
Schmidt: Marketers are wary overall. The industry is marred with bad actors, so they are worried about people trying to pull the wool over the proverbial eyes. We're trying to start from the right place with our clients. We have to dispel alot of the scaremongering. We're training our clients about what questions to ask.
Shields: What are they asking?
Schmidt: First it was "We want to understand flow of dollars." Now it's "How do we navigate through programmatic buying?" We had one client where we spent an hour and a half on brand safety alone. [Programmatic advertising is very powerful but] the ad tech sector can be a maelstrom of nefariousness. The only way we are going to muddle through this is to get educated.
Shields: Aside from the push for digital transparency, there are also hard questions being asked these days about whether old-fashioned interruptive advertising even works.
Schmidt: The other thing that is really core for my role is to examine this premise of "How do we make advertising more meaningful?" And going beyond standard
Shields: Is this going to require ad agencies to bring in all new talent?
Schmidt: The dynamic [inside agencies] has changed dramatically. You can't just put a bucket load of dollars into primetime TV. I don't want to call it better, but we need to find a way way to leverage data and tech ad automation. Advertising has to become more meaningful and accountable, so we are we are continuing to iterate on talent.
Shields: Does that mean agencies and marketers essentially need to weed out the old guard?
Schmidt: When I started in this business, I'd be in meetings and think, "This whole room won't exist in a year." That didn't happen. We are swiftly realizing that agencies have to adjust how they structure and operate. And the standard of how media planning is done needs to be upgraded and modified.
But with all that being said, you still have clients who will say, "I know TV works for me. If I'm targeting moms, put money in morning TV." You also have the media mix models that these clients use telling them to stick with TV. But if you ask a 20-year-old what network "This Is Us" is on they'll have no idea. So all those things are now getting updated.
When you use an audience-based approach like we do, it's about "How do we get message out that is not destructive and annoying?" That's the promise of programmatic.