While recently reading a post on the lack of good storytelling in the ad tech world, I found myself nodding in agreement. Gartner director Martin Kihn’s point is that ad tech companies should step up to the plate and have storytellers on board who can make “a cold and bewildering business” understandable. This is true, but only part of the solution. The other half is that the people in tech who dismiss ad tech in general need to get their heads out of the sand and recognize it’s a vital part of the ecosystem.
The fact of the matter is that the nitty gritty of ad tech is neglected by many business people, not to mention journalists, but it shouldn’t be. Ad tech is not only incredibly interesting but is an important part of our economy. Consider for a moment its role in just the developer/app ecosystem: Worldwide, mobile ad spend is projected to top a staggering $100 billion in 2016 and accounts for more than half of the digital market.
This is just the amount spent on mobile advertising. The return on this spend contributes to the success of these companies and adds to the GDP of their respective countries.
Fear of the unknown
I think people tend to look the other way with ad tech for several reasons, the first of course being the tech. It’s a field that is governed by daunting, math-y acronyms, like eCPM (Effective Cost Per Mille), ROAS (Return on Advertising Spending), and ARPDAU (Average Revenue Per Daily Active User) — terms that the initiated rattle off so fast it can make your head spin.
For many people, these terms signal a foray into a mystifying, threatening space. As one tech journalist recently told me, “Ad tech coverage is a wade into the weeds. … There’s a little bit of ‘Dude, that’s too technical’ and a little bit of ‘Dude, just serve the sausage; don’t show me how it’s made.’” In short, their eyes glaze over.
Then there’s the indisputable fact that sleaze creeps into our lives courtesy of ad tech, and that makes many people want to look away from the whole enterprise. “Sell your gold,” “58-year-old mom looks 27,” “The secret to perfectly white teeth.” Ad tech is often regarded as a responsible party when it comes to flashes of tacky across our screens. Thanks to ad tech, critics maintain, bottom feeders thrive.
So between the techiness and the tackiness, many people in business, marketing, and journalism, far from learning how ad tech works, tend to resist accepting it as incredibly important in today’s business environment.
But those who fail to engage are missing out on understanding one of the most exciting and interesting businesses out there — as well as on some of the most cutting-edge technology.
Why I love ad tech … and why everyone else should, too
While I’d never say I was intimidated when I first started learning the ad tech field (okay, maybe a little), I will say I knew I had a lot to learn. So I dove in and quickly became engrossed.
I loved looking at ad tech through the lens of Econ 101, given how it has a market, buyers, and sellers, but with the added thrill of operating by millisecond and leveraging all the data that is collected. I loved learning the details and how they impact the larger revenue picture. Before I knew it, I was spouting off jargon like CPI, CPC, and ROAS with the best of them. Now I love that I’m fluent in the technologies that play such a key role in marketing.
From an engineering standpoint, you’ve got to respect the sheer magnitude of the processing power that supports ad tech — we’re talking about systems that can each handle billions of ad requests a day — hundreds of thousands of ad requests per second.
That’s literally awe inspiring, but then when you consider that all of this power and data impact a multibillion-dollar ecosystem, it’s pretty much impossible to think, “That’s just not very important.” That’s like saying the stock market isn’t very important.
It’s also crucial to recognize another aspect of the big picture: These days, ad tech is the backbone of media. Without it, we wouldn’t have a news publishing industry, online video, and almost all of the unpaid content on the Internet. I’d argue that anyone who purports to be a technology expert should have at least a basic grasp of this very important part of the ecosystem.
I am amazed when companies who could benefit from ad tech think it’s not for them. It’s in the best interests of many of them to embrace it, and truly, it’s not hard to be informed about the basics. Ad tech is here to stay, and I have no doubt that history — and data! — will show that those who embrace it are going to be the winners in today’s business world.
Katie Jansen is VP of Marketing at AppLovin.