Professional Thesis - How to reach audiences in a fragmented Media Environment - Romain VILLA

Romain VILLA THESIS ORAL: 26TH NOVEMBER 2015 | FOLLOWING TUTOR: MARGHERITA PAGANI

How to reach audiences in a fragmented Media

environment? SPECIALIZED MASTER MARKETING AND SERVICE

MANAGEMENT

HAVAS MEDIA GROUP

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Table of contents

Executive summary .................................................................................................................... 5

Introduction ................................................................................................................................ 7

I/ Marketing Communication: diverse ways to reach people thanks to Media .................. 9

1°) Media functioning and organization ..................................................................................... 9

a- Press and OOH (Out Of Home): 2 old and local Media ........................................................ 9

b- Radio and Television: the beginning of the mass Media model .......................................... 11

c- Emergence of the Internet and the mobile technology: Evolution of how to measure and to

know customer preferences ...................................................................................................... 13

d- The roles of Media agencies and the case of Havas Media ................................................. 16

2°) An environment which knows deep modifications ............................................................ 16

a- A political and legal environment that have a strong influence on the Media landscape .... 16

b- Technology has helped in disrupting the economic environment….................................... 17

c- … answering to new customer needs ................................................................................... 18

d- Intensity of the variables in the Media landscape ................................................................ 18

e- Analysis of the different forces in presence for Havas Media ............................................. 19

3°) Links and relationships between brands, Media agencies and customers .......................... 20

a- The service brand relationship value triangle ...................................................................... 20

b- The evolution of how to reach customers and how it can be measured............................... 25

c- Challenges for advertising agencies ..................................................................................... 27

4°) Presentation of the interviews: a qualitative study to understand those challenges ........... 29

a- Explanation of the methodology and the people interviewed .............................................. 29

b- What are the main ideas presented? ..................................................................................... 30

II/ A media landscape which knows different evolutions in its functioning ..................... 32

1°) Presentation of the programmatic technology .................................................................... 32

a- The model of programmatic buying ..................................................................................... 32

b- Focalization on the Real Time Bidding processes ............................................................... 35

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c- How entities make Real Time Bidding primordial today? ................................................... 37

2°) A technology which meets different objectives for brands and Media agencies ............... 39

a- Advantages of Programmatic and the need of programmatic technology to help in the

strategic choices ....................................................................................................................... 39

b- Applications to every Media and evolutions ....................................................................... 41

III/ Challenges of Programmatic: a need of a better understanding ................................ 44

1°) A need for brands and Media agencies to understand their audience ................................ 44

a- Media agencies have to be “agile” and to be creative .......................................................... 44

b- Make understanding the benefits of programmatic to announcers ...................................... 45

c- But the French legal setting is obsolet ................................................................................. 47

2°) Technologic limits .............................................................................................................. 48

a- Telecommunication operators and the need of unification .................................................. 49

b- The case of Adblock: a threat or an opportunity? ................................................................ 49

IV/ Havas Media has the possibility to develop Audience planning, by accompanying the

evolution of the Media landscape .......................................................................................... 51

1°) A need to help in change .................................................................................................... 51

a- How to restrict data and technical limits? ............................................................................ 51

b- How to consider the Adblock software? .............................................................................. 53

c- A need of changing of the law for this field ......................................................................... 54

d- What about ethics? ............................................................................................................... 55

2°) To develop research and rethink the role of Media agencies ............................................. 56

a- A need of change of the Media agencies remuneration? ..................................................... 56

b- To develop researches about data ........................................................................................ 57

c- A need to build Media planning thanks to Audience planning and to accompany the Media

environment to change ............................................................................................................. 59

Conclusion ............................................................................................................................... 60

Sources ..................................................................................................................................... 61

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ANNEXES ............................................................................................................................... 64

1st Annex - PESTEL analysis of the Media landscape ............................................................. 64

2nd annex - 5 Porter forces analysis on the Media agencies environment .............................. 67

3rd annex - Audio characteristics in France, Mediametrie Global radio and Kantar Media,

2014 .......................................................................................................................................... 69

4th annex - Video characteristics in France, Mediametrie Home Devices and Global TV, 2014

.................................................................................................................................................. 71

5th annex - Publishing characteristics in France, Press Observatory, 2014 .............................. 73

6th annex – Programmatic ecosystem and examples of principal actors .................................. 75

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Special thanks

I particularly want to thank Margherita Pagani, who has followed the evolution of my entire professional

thesis and helped me a lot in the development of my problematic.

I also want to thank Camille Bellemon, Consultant Director of Havas Media, who has been working with

me for six months. Her advices and her follow up have allowed me to find all information I need. I also think about

Deborah Wits, who has helped me a lot in the understanding of programmatic.

Finally, I also want to thank all people interviewed. Their testimonies helped me a lot in understanding

the Media environment. I could not have analysed issues and recommendations the same way without their

experiences.

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Executive summary

With the development of new technologies and particularly Digital, Media environment

has deeply changed. Offer diversification and devices have been developed. Consequently,

audience has been fragmented and the technologic development to understand this audience has

strongly increased. Media agencies had the reflex to adapt their advertising campaign

management, evolving from a model of Media planning to Audience planning. We move from

a Media centric to a user centric vision where Media agencies do not buy anymore a Media but

an audience. Considered as more efficient and answering lots of communication issues, we can

ask if Audience planning is not going to make disappear Media planning.

Traditional Media, evolving in their Business Models and the development of their

offers have more or less adapted their technologies to the evolution of audience tracking. To

finance their models and to adapt their advertising revenues, Media as TV use IPTV to find its

audiences, and Radio develops its offers in Digital. However, it is still rare to see those

transactions done in real time.

Media agencies have developed programmatic to analyse audiences by getting data. One

of those aspects, RTB or Real Time Bidding, is a buying system, where locations are being

auctioned, in real time, in function of the Internet user paths, and is spreading quickly.

Programmatic, characterized to find the good customer at the good moment and at the good

price disrupts advertising codes. Audience targeting implies new rules in data collecting but

also in its analysis. Different traditional Media are thinking in how they can develop

programmatic inside their offers. And Media agencies have to adapt to this evolution.

Media agencies need to be agile and to make evolve their offers. Programmatic

development seems today to be ineluctable and Media agencies have to take advantage of it.

Processes transparency has to be taken into account. These companies know technologic limits

due to telecommunication operators but also software, and an obsolete French law. Competition

also forces Media agencies to innovate in their data analysis. Moreover, they have to understand

new needs of customers and to be actors of the change.

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They have to adapt their offers, considering the different limits, technical or legal, and

to make understand that Media agencies have to evolve in their remuneration and to reconsider

it. They have to take advantage of new software as Adblock which can refine audience and

show that advertising can be a true service given to consumers. As a consequence, ethics

questions become central and the constitution of departments dedicated to researches around

data analysis seems necessary.

The development of communication campaigns on Media planning and Audience

planning models answers to different objectives. It is not one against the other but one with the

other. Media agencies have to take advantage of technologic evolutions and manage their

issues.

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Introduction

« Programmatic development has come from the existence of an incalculable number

of supports, and the difficulty to reach audiences in a fragmented environment” explains a

Havas Media Consultant. Due to difficulties in their business models, Media agencies use new

ways to reach audiences. Digital and innovation seem today unavoidable. Media agencies role

evolves more and more from service providers to Business partners.

The Media environment (Television and Cinema, Radio, Digital, Out Of Home and

Press) has radically changed, particularly since the arrival of Digital. Media are easily

accessible and develop more and more a freemium Model on Digital. Moreover, with the arrival

of new channels and numeric platforms, Media have to develop their offers to prove what

audience they reach. On the other side, announcers have to innovate in their communication to

reach customers and they need more and more to address their messages to a precise audience.

By answering this, Media agencies have to find new ways to reach this audience. But what tools

and technologic innovations could help them?

Communication campaigns are traditionally organized on a Media planning model. The

objective is to use a Media to reach a particular kind of audience. Traditional Media have

developed their technologies to find audiences. Moreover, thanks to Digital, new tools have

been developed to analyse audiences and gather data. Programmatic is one of the biggest

revolution in the Media environment to reach the good audience. It allows to gather data and to

analyse Internet user behaviours. Programmatic is considered as a system to find the good

audience, at the good moment and at the better price possible. With this technologic evolution,

the objective is not to use a Media to find an audience but to target the Internet user directly.

For many people, it allows to measure the audience and to have precise data that can be analysed

to adapt messages. Theoretically, programmatic is the best tool to target audience. More and

more people think that this model is going to spread to every Media. But is Programmatic can

answer every Media objectives?

In the context of a fragmented Media environment, does the audience planning is

going to remove traditional Media planning?

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Audience planning implies lots of innovation, in the service given but also in processes.

It needs a deep adaptation of the Media environment and particularly Media agencies. It is first

necessary to analyse how the Media environment is constituted and to determine how

Programmatic can influence them. It will permit to understand issues and understand that Media

agencies have the possibility to develop Audience planning, questioning their Business Model

and role.

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I/ Marketing Communication: diverse ways to reach

people thanks to Media

1°) Media functioning and organization

Understanding the Media landscape and knowing its specificities on its Business Models

allow us to see why they are more and more willing to use new technologies to find their

audiences and become more efficient.

a- Press and OOH (Out Of Home): 2 old and local Media

Press is the oldest Media in the world. It has appeared on several forms: manuscript

news, lampoon, almanacs… It has particularly been developed during the 17th and 18th

centuries. The first one Relation Aller Fürnemmen und gedenckwürdigen Histortien is launched

at Strasbourg in December 1605 by Johann Carolus1 thanks to the decline of paper prices and

the high development of printing. In France, the first printed newspaper is La Gazette, created

by Théophraste Renaudot and published at Paris, during May 1631. The development of written

press has let the development of famous titles that we still know today, as Le Figaro (1826), La

Dépêche du Midi (1870), La Croix (1880), Les Echos (1904) and “L’Humanité” (1908). The

Business Model of paying written press has been developed since today. The coming of the free

newspapers in the middle of the 20th century implies a new Business Model, only based on

advertising to finance the publications. More local at the beginning, the regional free

newspapers have been developed during the eighties with the creation of Les Nouvelles

d’Orléans in 1980 by Michel Gaudron and Etienne Verdier or Le Petit Solognot, in 1983 by

Gérard Bardon and Dominique Labarière. But we had to wait until February 2002 to see the

first national free newspaper Metro (which is now a pure player, the paper version has been

stopped in July 2015), followed by 20 Minutes and Direct Matin.

To finance their publications, press companies can sell their newspapers but also being

paid thanks to advertising. But, with the development of Digital, Press has changed its Business

1 World Association of Newspapers, wan-press.org

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Models. The high numbers of free articles on the Internet have changed the ways people

consume Press. They can have an easy access on every subjects. The example of Metro shows

that the Internet has changed how to reach people. The decrease of publications forced this free

newspaper to change its Business Model, to become a pure player and only available on the

Internet and not more on paper versions. Most of traditional newspapers have changed their

offers as the example of Le Figaro or Les Echos which are now based more on a freemium

model. You can first access to some articles every months but you have to pay if you go on

more than 5 articles for Les Echos. For its part, Le Figaro lets access to the majority of its

articles but some of them are reserved for subscribers, for example.

More and more newspapers and magazines pursue their mutation to the Digital.

However, the loss of revenue for the paper versions are not counterbalanced by Digital

revenues. According to the OJD, during its “25th Press Observatory”, professional Press has

declined by 7,4%, the national daily Press, by 5%, and magazine Press, by 3% in 2014. On the

contrary, the websites frequentation of those titles have increased by 22% between 2013 and

2014, and mobile frequentation raised by 39% on the same period. 18% of French people, aged

of 15 years old and more, read at least one press brand on tablets2. But this augmentation does

not compensate the losses of written Press. 3,8 billion paper copies have been produced in 2014,

according to the 24th Press Observatory in January 2015 and 43,9 million copies in numeric

versions (PDF).

Business Models of Press evolve. According to Future exploration3 written Press could

disappear in the United States by 2017, and in France, by 2029. Press is considered as a

qualitative Media where brands place their advertisings, responding to brand image

problematic. Press is, in fact, considered as a Media of quality and permits to brands to be as

close as possible to their customers. However, the decrease of revenues are a real threat for this

Media because it implies that the quality of this Media in general is on the decline. And if the

quality declines, audience will decline, as the advertising investments. It is a vicious circle that

can be counterbalanced. The pursuing of mutations also shows that new ways to find financing

are possible, and are going to be studied in the coming paragraphs.

OOH (Out Of Home) is also a “proximity Media”, which puts products in our daily life

and is considered as the last contact point with customers. It appeared during the 15th century

2 Mediametrie: Audipresse One Global – Mediametrie, April 2015 3 Ross Dawnson, Newspaper extinction timeline – When newspapers in their current form will become

insignificant, rossdawson.com

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in cities to stick up the announcements of public town criers and particularly developed during

the 17th century with the development of alphabetization. The offers have been developed and

when we speak about OOH nowadays, it can be public posters but also flyers or placemats. It

is a Medium which resists more than others because it is less replaceable. With an increase of

0,4% of investments in 2013, according to France Pub, it is considered as solid but also modifies

its offers4. Thanks to new technologies and possibilities along with smartphones, the 2 world

leaders, JCDecaux and Clear Channel have deleted lots of their big format (1500 to 2000 for

JCDecaux, 1500 for Clear Channel) to be more concentrated on interactive support (billboards

become more and more digital for them with 2941 screens in 2013, 500 more than 2012).

b- Radio and Television: the beginning of the mass Media model

During the 19th century, characterized by the evolution of multiple inventions, from the

electric telegraph and Morse, invented by Samuel Morse in 1841, the discovering of hertzian

waves in 1886-1888 by Heinrich Rudolf Hertz as examples, the first application of radio in

France have begun in November 1898 with Eugène Ducretet who has made the first public

transmission with “Wireless Telegraphy” between the Eiffel Tower and the Pantheon. The first

Radio emission destined for public has been made in December 1921 by Radio Tour Eiffel. The

interwar period has seen the development of private and public radios to the nationalization of

every radio in March 1945. French radios had to wait until 1981 to see official private radios

opening and 1982 to attribute the hertzian waves with the creation of the “High authority of

audio-visual communication”. It is the first Mass Media model. Millions of people can hear the

same message in a very short period, with free access. The Business Model is also built on

advertising to finance programs.

Today, the debate is on the TNR (Terrestrial Numeric Radio), which has started in 2012

with Paris, Marseille, Nice, and after in Lyon, Nantes, Brest… Hertzian waves are now

saturated in France and independent radios demand to expand TNR in order to develop their

coverage on the territory. TNR permits in fact to broadcast far more stations, to improve the

sound and to give the possibility to have associated data (song, title, picture, games…). But the

biggest groups as Radio France, NRJ group, Lagardère Activ and Nextradio TV, which gather

4 Alexandre Debouté, L’affichage résiste en France, Le Figaro, 22nd November 2013

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the majority of the hertzian waves estimate that the TNR is expensive and non-operational.

Independent radios consider that big private groups make a lobby action to restrict competition

and to keep their audience base.

Radio is a Medium which changes a lot, particularly with the development of the

Internet which modifies the listening habits. In September – December 2013, they were 43,3

million people who have listened to the radio daily and 3 hours on average5. According to

Mediametrie6, in 2014, 89,4% of people aged from 13 years old were listening to the radio on

radio post, 3,8% on mobile and 6,7% on other supports. But if we focus only on the people aged

from 13 to 24 years old, the proportion of radio post is 70,9%, 16,5% on mobile and 12,5% on

other supports. A modification in the habits that radios want to change by using more and more

digital to have revenues.

The beginning of Television, for its part, was in 1880-1881 when Georges R. Carey,

Adriano de Paiva and Constantin Senlecq had developed the concept of sequential analysis

principle that is at the base of every animated image transmission. In France, the first image

transmission occurred in April 1931, thanks to René Barthélemy. The first emission is

transmitted in January 1937, every evening between 8 p.m. and 8.30 p.m. Canal+, the first

private and paying channel is created in November 1984. TF1 is privatized during 1987. France

Télévision, for its part has been created in January 2000 and the cessation of advertising on this

public service between 8 p.m. and 6 a.m. has begun in January 2009. TNT (Terrestrial Numeric

Channel) has been created in March 2005 with eight more channels (TMC, NT1, W9…). As it

was defined before, TNR would be on the same signal than TNT. The signal has then permitted

to welcome more channels like BFM TV or France Ô. Except France Television, which is

financed, in part, by the French government, and some channels, like Canal+, in part by

subscriptions (around 13,4 million today according to Mediametrie7), the majority of TV

channels is financed by advertisement.

Television (with Cinema) is the major Medium in terms of investments in France and

in duration of watching (3h41 per people in 2014 every day). At the end of 2013, 83% of French

homes had a television8. As other Media, laws have been voted to legislate advertising. France

5 Chiffres clés de la Radio en France, Mediametrie and SNRL (Syndicat National des Radio Libres), 24th

November 2014 6 Mediametrie Global Radio 2 December 2014, Monday-Friday 5a.m. – 12 p.m., 13 years old and + 7 Communiqué de presse, Médiamat’thématik – L’audience des chaînes sur le câble, le satellite et la TV par

ADSL, du 2 septembre 2013 au 16 février 2014, Mediametrie, 13th March 2014 8 Key figures of French Audiovisual: 2nd Semester 2014, ASC (Audiovisual Superior Council)

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has the particularity to ensure the listening quality for every Media. But it implies numerous

restrictions: the sponsorship is highly delimited and advertising has to be at the national scale

(Décrêt n°92-280 on 27 March 19929). Only a few Media, as France 3 Régions can have

advertising at the local scale.

Television is also a Medium which knows lots of mutations, particularly since the

beginning of video on the Internet and the arrival of new actors as Netflix or Youtube. Watching

habits has changed. According to Mediametrie, 2 million people in France (15+ years old)

watch Television on another screen in 201410. It is 82% more than 2 years ago and they spend

4 minutes on it every day. 40,5% of people 15+ years old watch TV on another screen, but this

rate climb at 58,7% for the 15-24 years old people11. A modification that channels have

identified.

c- Emergence of the Internet and the mobile technology: Evolution of how to measure and to

know customer preferences

World Wide Web has spread at the end of the nineties and has been particularly

developed at the beginning of the 21st century. We have to go back in 1934 to find the first

vision of the Internet rising with Paul Otlet in its Documentation treaty. The first informatics

connection with a high distance has been made in 1965 with Lawrence G. Roberts and Thomas

Merrill between Massachusetts and California. The Internet is organized in more than 47 000

autonomous networks and the World Wide Web is one of the applications of the Internet. The

Web, as we know it today has appeared at the beginning of the nineties with the HTML

technology and the first browser in 1993. In September 2014, the Internet (as we will call it to

refer to the World Wide Web) has one billion websites for 3 billion Internet users. And those

figures are still increasing.

The Internet and its digital applications have deeply changed our habits and the ways

we are linked to the world and to Media. 75% of French people (46,2 million) aged of 2 years

9 Legifrance: décret n°92-280 du 27 Mars 1992 pris pour l’application des articles 27 et 33 de la loi n°86-1067

du 30 Septembre 1986 et fixant les principes généraux définissant les obligations des éditeurs de services en

matière de publicité, de parrainage et de télé-achat 10 L’année TV 2014, Mediametrie, 28th January 2015 11 Global TV, april-june 2014

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and more have access to the Internet12, 55,7% (30,4 million) are mobile users13 and 29,1% (12,6

million) are tablet users14. Mobile is said to spread far more in the coming years and is

considered as the future principal device for Media. In 2014, 9 million French homes had 4

screens by average (1/3 of French homes)15. To establish a picture of the Media landscape, we

can see in this scheme the repartition of Media investments and the evolution between 2013

and 2014:

Digital has become the second most powerful Medium in terms of advertising

investments in 2014 (it represents 2,89 billion of Euros in France, increasing by 4% comparing

to 2013). In more details, according to the SRI (Syndicat des Régies Internet), in Digital, mobile

advertising investments have increased by 80%, programmatic by 66% and video format by

65%16. The evolution of Search, Display and other levers is shown in this scheme:

12 Measure of the fixed Internet, 2 years old people and more, Mediametrie, February 2015 13 Telephony and Mobile services - 11 years old people and more, Mediametrie, 4th semester 2014 14 Observatory Web - Internet users 15 years old and more, Mediametrie, 3rd semester 2014 15 Home Device - November / December 2014 16 Olivier Chicheportiche, Pub en ligne: Internet dépasse la presse écrite pour la première fois, zdnet.fr, 29th

January 2015

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Display is the ensemble of classical formats (banners, interstitials…), video formats,

Programmatic and Mobile. Search is referring to search engines like Google or Bing. More and

more Media uses the Web to develop their strategies and to enlarge offers. Every one of them

is becoming more and more digital. OOH has interactive billboards, radio and TV can be

listened and watch on the Internet and Press titles publish more and more on their websites. The

model of “Freemium”, characterized by a free part and a paying premium part, which allows

access to a bigger part of those websites or removes advertising, is spreading. Platforms are

also rising like Deezer or Spotify for music, Netflix and Youtube for the Video or e-Press and

LeKiosk for Press and disrupt the codes of Media.

Media world evolves. A new kind of the advertising is developed and Media are

searching for new ideas to know their audiences. Digital Marketing has lots of challenges today,

as Programmatic, and technology permits now to target the good audience at the good moment.

But the applications are different today, in function of every Media.

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d- The roles of Media agencies and the case of Havas Media

A Media agency advises an announcer in its Media choices and accompany it in the

setting of its communication strategy. In the case of Havas Media, it has to elaborate Media

strategies, to plan campaigns, to negotiate prices of locations of Media sellers and to measure

the profitability of Media investments.

Havas Media is considered as the sixth international group in terms of turnover. It has

been created in 1999, with the fusion of Media planning in Spain and Mediapolis in France.

The two companies work on the same activities but are complementary on the geographic

repartition. It has developed its Trading desk Affiperf to manage new technologies and to be

able to make programmatic buying.

Media consultant at Havas Media work in intern with different department, specialized

on every Media to organize multi-Media strategies, responding to the objectives of brands. They

are always searching for new ways to reach the good audience in a Media environment which

is constantly changing.

2°) An environment which knows deep modifications

A Macro-environment analysis permits to understand what the biggest issues of a Media

agency like Havas Media are, and to understand what are threats and opportunities. The

PESTEL analysis (see annex n°1), from the Havas Media point of view, allows a better vision

of the Media landscape and permits to have a first study of the issues.

a- A political and legal environment that have a strong influence on the Media landscape

Modifications of the Media landscape are numerous. Some agencies can even

sometimes work for nothing when there are invitations to tender. The aim is after to keep the

announcer and to propose diversifications of their Media campaigns to make money. But this

kind of proposal can be problematic, particularly for small actors. The question is to know if

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modifications have to be brought by the government or if it is all actors that have to coordinate

their remuneration and to reconsider their work. Havas Media has to make understand that it

has to modify ways it remunerates. Remuneration is largely made on volumes which have been

sold. Reconsidering Media agencies, at the centre of the Media environment, as Business

partners and not only location buyers is now primordial.

There is a lack of transparency between actors. The development of Media sellers inside

Media agencies has caused a temptation to compensate losses of invitations to tender in a lack

of transparency in their Media buying.

Laws restrict for the moment the possibilities to make local advertisements.

Development of programmatic in Media needs an adaptation of the law to permit to target

people, even on Mass Media and make personalized advertising.

b- Technology has helped in disrupting the economic environment…

Digital has brought lots of opportunities, but it has also disrupted the Media

environment. In fact, more and more content is available on the Internet, freely and it has

changes ways for Havas Media to target the good audience. This audience is fragmented and

Media agencies have developed programmatic, for example, to target precisely the good

audience. One of the biggest issue today seems to be the lack of transparency in the Media

agencies processes. Another issue is the lack of measurement for the advertising campaigns.

Technologic innovation and Digital has permitted to have more measurements on how

customers can consume Media. The tracking on the Internet and the development of new KPIs

(time spent on website, click rate…) allow to understand more the consumer behaviour on

Media, and particularly Digital. More and more tools in advertising, like brand safety software

allow to delimit the environment of diffusion of brands. New automations of processes also

help in the organization of a Media campaign.

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c- … answering to new customer needs

People spend more and more time on Media, particularly with the development of

Mobile. Media agencies have to understand that new generations consume Media differently.

Havas Media uses software as SIMM-TGI to understand what Media can be consumed, in

function of the audience and the subjects. If Havas Media wants to reach them, it has to be

multi-devices and to understand their behaviours.

Moreover, customers have now the possibility to remove advertisements on their

browsers thanks to software as Adblock. Lots of customers consider that advertisement can be

intrusive and the question of tracking data on Digital is also a very sensitive subject. Havas

Media has to demonstrate that advertising can be a service for customers.

d- Intensity of the variables in the Media landscape

The following scheme allows to measure the impact of each variable for Havas Media:

The Media environment knows lots of modifications. The most important one is the

technologic variable which influences a lot Havas Media. It allows to automate processes and

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to diversify devices. Moreover, Digital technology, applied to TV or Radio has permitted to

develop devices and has directly influenced the development of offers. The major issue for

advertising agencies is to manage new technologies and to understand audience behaviours.

e- Analysis of the different forces in presence for Havas Media

The following scheme shows the intensity of every forces and measures their impacts

on Havas Media:

The five forces are completed by a qualitative grade, classed from 1 to 4. The French

market is mature and firms, with an international network are already presents. But, innovations

in Digital are increasing and Media agencies have to remain alert. So the risk of potential new

entrants (as it has been the case for Facebook or Google for example) can increase in the coming

years. Moreover, Media agencies and Havas Media will have to rethink about their

remuneration and Business Model, with the development of the need of transparency by

announcers.

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Havas Media has integrated, the entire value chain in the advertising campaigns.

However, announcers can also hire Media consultant and develop their own Media departments

inside their companies. It could help them in data securing by limiting its share.

Suppliers, as Media, have a stronger negotiation power. Strong actors as Facebook,

Youtube or Google can impose their rules. However, the fragmentation of the Media landscape

and audience have driven down the prices of traditional locations.

Customers are central in the Media agency strategy. The diversification of ways they

can interact with brands (particularly thanks to social networks) have given them more power,

by contacting them directly, under the watchful eye of others customers. Moreover, with the

development of Adblock software, people can choose, if they want, to have advertisements or

not. To understand audiences and their needs is a challenge for Media agencies which demand

coordination from the ensemble of Media actors.

To understand them, Media agencies have developed their technologies to get data on

Media. Data management implies all actors of the Media landscape. Security, share and ethics

of data analysis are some of the biggest issues in the years to come. Data will be one of the

future comparative advantage in the Media environment. But we have to understand links

between every part to understand this question of data.

3°) Links and relationships between brands, Media agencies and customers

Media agencies have a central role in the Media landscape. Understand their position in

this environment will allow to see how Audience planning modify their links.

a- The service brand relationship value triangle

Before the arriving of the Internet, the biggest challenge for marketers was to know how

to reach in another way the contact and how they could interact with him. Personalization is

still a big issue today to create more contact with the customer. But the creation of this contact

implies that Media agencies have to measure it. Measuring marketing communications results

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has never been easy. And measuring the returns of Integrated Marketing Communication (IMC)

seems to be doubly difficult. IMC is a strategy of Communication and Marketing, aimed at

integrating in such a way as to be coherent and efficient, all the communication canals of a

brand. The IMC challenge is how to measure the results of a combination of elements or

activities or communication forms that may or may not interact with each other and may or may

not create enhanced results. There is no one, single, agreed-upon measure of advertising or

marketing communication effectiveness which is widely accepted in either country. As for Don

E.Schultz, from the Northwestern University and Agora, in IMC Measurement: The Challenges

of an Interactive Marketplace, historically, some experts said that the value of the

communication must be to the consumer or prospect (Keller, 2003; Lavidge & Steiner, 1961;

Rust, Zeithaml and Lemon, 2004). Others said that it must be determined by what financial

returns are generated by the marketing organization (Schultz, Tannenbaum & Lauterborn, 1996;

Lenskold, 2003, Shcultz, Barnes, Schultz and Azzaro, 2009). Others think about social returns:

marketing communications activities must support corporate sustainability and to contribute to

the well-being of the society as a whole (Sharma & Starick, 2002; Kotler, 2010; Kotler

Kartajaya & Seitawan, 2010).

The initial efforts in IMC measurement were not necessarily based on communication

effects, but on behavioural responses by consumers. During the eighties and mid-nineties, the

focus of most Marketing communications measurement was on expending and refining the wide

variety of techniques that had been developed over the previous fifty or so years. For

advertising, that meant measuring communication effects. For the functional groups as Media

agencies, it generally involved behavioural measures. It was the challenge of finding ways to

combine and to coordinate the various communication activities. It has been traditionally

measured by addition or subtraction, not multiplication. It is also one of the big issues today:

how to combine human and technologic forces to target the right audience.

22

A Media campaign is prepared as followed:

In the mid 90’s, digital communication came on the scene. It radically changed the

control of the entire communication system. Where historically marketers controlled most of

the market and Marketing information, the interactive systems began to enable consumers and

customers to access information from sources other than the marketing organization as third

party sources such as websites, consortiums, resource centres, other customers... Marketing

Communication began to be interactive.

23

It has a major impact on all forms of marketing communication as it is shown in this

exhibit:

It has been called the development of the “push-pull” marketing communications

system. Marketing organizations continue to send out planned Marketing communication

messages through traditional outbound Media systems. These are called “Push” approaches:

the marketer pushes communications out to the customer or prospect. Marketers tried to connect

into an efficient communication delivery system or generate some type of consumer responses,

either attitudinal or behavioural. “Pull” methodologies customers are now using to acquire the

information or material they want or need. Three broad approaches are currently being used:

- The Internet and World Wide Web (search),

- Mobile communication where consumers can connect to other customers,

- New electronic word of mouth systems, which often are called social Media.

In each of these “Pull” Media forms, the systems are driven by the consumer. Today,

most marketing communication measures are based on some application of the hierarchy of

effects models. The problem is how to separate or to quantify which activity generates the

attitudinal or memory change. The marketplace is complex and the brand has become

particularly central as it is shown in the next scheme:

24

In the world of communication, it is necessary to understand how to manage every part

of the brand relationship value triangle. Brands are central and at the heart of the

communication. Another issue must be taken into consideration: the synergy or the potential

multiplicative effects that may occur as a result of consumer’s exposure to multiple Marketing

communication messages. Before, organizations activities as advertising, sales promotion or

direct marketing were measured separately. Now, the synergy between and among them

becomes an important emerging measure that must be considered.

3 major IMC audiences must be taken into account:

- Consumers/customers/users of IMC,

- The Marketing communication organization that develops and delivers IMC programs,

- Other, more global audiences such as the general society where issues of sustainability

and proper allocation of social resources are involved.

To estimate the impact of a communication campaign and to measure it have never been

easy. However, particularly thanks to new technologies, ways to reach customers have evolved.

25

b- The evolution of how to reach customers and how it can be measured

We are more and more today on the problematic to reach the right audience at the good

moment. Advertising agencies speak more about “Audience Planning” than “Media Planning”.

Media Planning is the action which consists in “choosing, in the framework of an advertising

campaign, Media and supports to be used, the choice of the diffusion moments and the

establishment of a campaign calendar”17. It is more focused on the Media to use in order to

reach the ensemble of a target. For example, for an advertising campaign, you can use a

particular radio that reach the SCP+ (well off Socio-Professional Category) 25-59 years old

men. The message will be send to every people who listens to the radio, which means

particularly the SCP+ 25-59 years old men, but also other targets. Audience Planning refers to

the “process which consists in reaching a target, answering to precise characteristics, without

having any a priory on the places or the advertising supports used”18. It has been born thanks

to digital campaigns with the “Ad-exchanges” which we are going to develop in the next parts.

A typical example is “retargeting campaign” where you have to quickly reach the people who

has left a website, thanks sometimes to “cross device”. Cross device is the “problematic which

consists in following and recognizing a user when he uses successively some screens or

connected displays”19.

With Audience Planning, Havas Media reaches a precise person associated to data and

not thanks to a Media (Media planning). Every time an Internet user is on a website, he interacts

with it, leaving data-rich digital footprints. It reveals pages a consumer visits on a website,

where he engages, subscriptions, cross-device behaviours… It permits to Havas Media

consultant to understand their audience and to reach them. When you know your audience, it

means that you interest in its interaction with brands and how you can interact and make them

understand your message.

Havas Media uses KPI’s (Key Performance Indicators) to measure the impact of an

advertising campaigns. If we take the example of a radio, the average time of listening and the

number of persons who listens to the radio are considered as KPI’s. Audience planning also

allows to have KPI to measure the impact of the advertising campaigns. Those KPIs can be the

behaviours of the website visitor (Average time on the website, click rate, number of pages

17 Definition Media planning, Définitions Marketing 18 Définition Audience planning, Définitions Marketing 19 Definition Tracking cross-device, Définitions Marketing

26

visited…), purchase data, Newsletter subscription… If we take KIA motors France for example,

KPIs could be the number of visits on the website or the car tests requests, answering

performance objectives.

With the Internet, all Internet users can be “followed” to understand their propensity to

answer favourably to an advertiser’s message. The understanding of the customer behaviour

allows to identify the good strategy to adopt in order to deliver a message. To understand the

customer, marketers use “first”, “second” and “third party data”:

- The first party data is defined as the information of your own company about your

audience. It is most often cookie-based data and it can incorporate information

assembled from website analytics platforms, CRM (Customer Relationship

Management) systems and business analysis tools. It is the major strategy of Amazon:

their personalized recommendations are a first party data example. They understand

their customers behaviour and create dynamic and personalized advertising to make

convert customers, which means, in this case, to buy other products linked to the

customer’s interests,

- When companies do not have first-hand information, second and third party data

become useful. Second party data is somebody else’s first party data. The two trusted

entities find an arrangement to share their customer data,

- When a company sells its data, it is considered as a third party data. This kind of

company is also known as DMP’s (Data Management Platforms) or data aggregator.

They are esteemed to gather a vast amount of data and they make their data accessible

to competitors. So there is not a unique audience intelligence and it is possible to adapt

the strategy, answering competitors which can use the same data20.

One other difference between Audience and Media planning is the optimization of the

campaign. Once a Media-plan has been agreed, it will be mostly stable, at least for a first part

of a campaign. But with Audience planning, it is possible to have direct feedback and to adapt

the campaign. Real-time campaign performance authorizes to modify the segmentation and

targeting model. To allow new insights and to enrich the KPI’s permit to modify the targeting,

to identify trends and sometimes to change the strategy adopted by a company.

20 Kathleen Limon (Product Manager), The difference between first, second, and third party data and how to use

them, Retargeter Blog

27

Audience targeting has deeply changed the marketer approaches on online Media. And

we know that, very soon, all Media are going to be planned differently as more and more

channels become digital.

c- Challenges for advertising agencies

To be successful in the new Media landscape, marketers must adapt their environment,

understand the effectiveness of every Media and the information collected. But it implies

numerous challenges as the transparency of the data.

With Audience planning, you move from a media-centric vision, proper to Media

planning, to a user-centric vision. It is a considerable step forward to the transparency of the

data and to know the impact of the advertising message. But, with the online advertising, there

is also the problem of “robots”, which are considered to make lose around 8 billion euros in the

world in 201421, according to IAB (Interactive Advertising Bureau). Moreover, they consider

that 25 to 50% of online advertising investments are wasted in impressions and are never seen

by Internet users. It is one of the bigger challenges to take up in the years to come with the rise

of programmatic advertising which is going to rise to 28% in 2013 to 65-75% in 2017, according

to the IDC (International Data Council).

The value of an advertisement depends on the public interactions with the website. To

make this advertisement valuable, it is possible to make the announcer paying the click or the

page viewed. We speak about advertising fraud when software are used to simulate the traffic

on another website. Thus, the impression is never seen by the Internet user and the statistics are

deformed. Technically, a person can create a website and register it on an ad-network which

sells advertisement locations thanks to an ad-exchange. After that, this person can develop or

buy easily on the Web a software which imitates an Internet user behaviour, opening different

pages on the previous website created, and can do it endlessly. Announcer can, this way,

identify a website which correspond to its target, bid on the inventory and give impressions to

21 Ari Levenfeld, Publicité en ligne: combattre les robots, ou comment régler un problème à 8 milliards d’euros!,

e-marketing.fr, 12th January 2015

28

robots. And if the ad-network or the ad-exchange detects the fraud and expels the website, it is

possible to create a new one.

But there are measures taken to guard against this fraud. Google for example has

acquired spider.io which is specialized in fraud detection. They have identified a fraud of 6

million dollar lost per month to announcers. Facebook has sued Martin Grunin for the

misappropriation of 360 000 dollars. Buying platforms also changed: it is now possible to

dismiss suspect websites by distinguishing human to robot behaviours. Humans for example

buy on the Internet thanks to their credit cards and not robots. Moreover, a human will not visit

thousands of websites every days on short periods. The IAB has published an ensemble of anti-

fraud principles to help in having a reference in protection against trickery.

Another challenge for advertising agencies is to diversify their Media landscape:

“We are facing a macroeconomic crisis and a strong evolution of the Media landscape,

with new entrants in TNT, technologic evolutions and usage modifications” says Luc Tran-

Thang, president of Starcom (Publicis Group)22.

With the decrease of press publications and the rise of online journalism, press

diversifies its revenues thanks to its websites but the online advertising stocks are cheaper than

printed press. Media consultants can use Programmatic and analyse data to be more user-

centric. Using ad-exchange permits to use a precise targeting.

Luc Thang adds: “data permits to make the link between different channels, to

understand better the consumer path, whose contact points are more and more multiple. It

permits to go from a Media orchestration system to an inter-Media integration”23.

In the same trend, Media are more and more “social”. People do not always fill forms

but they can “tweet”, “like” and “comment”. Everyone produces deliberately data which can

be analysed. Dominique Delport, from Havas Media France evaluates that there is an increase

of audience from 10 to 20% on deferred diffusion. It is now possible to create direct contact

with the customer. During the last Super Bowl, when advertising screen interrupted by a

blackout, the creative people of the brand Oreo have developed an advertisement in a few

minutes with the slogan: “You can still dunk in the dark”, the verb “to dunk” refers to put an

22 Capucine Cousin, Les 5 Enjeux des agences médias, Stratégies.fr, 25th April 2013

29

Oreo in milk. Oreo created a direct link with customers and ensured it a large scale

communication.

Moving from a Media-centric to a user-centric vision implies many challenges. To pay

attention to online advertising fraud and to diversify the Media landscape by using

Programmatic or social networks permits to answer to the Media crisis by finding other ways

to find money. They are two consequences of the need of traceability of data and the need to

maintain or develop a good Media editorial quality thanks to more measurable communication.

And the development of more and more digital suggest that Programmatic will spread to other

Media than only the Internet.

4°) Presentation of the interviews: a qualitative study to understand those

challenges

It is primordial to understand Consultants points of view, regarding their own

departments. Their testimonies permit to understand what biggest direct issues are for them and

will allow to give recommendations.

a- Explanation of the methodology and the people interviewed

In this study, we aim at searching if new technologies help in the organization of a Media

agency campaign and if they are going to replace the traditional Media planning. To understand

this, a qualitative study is necessary to understand what actual challenges are and the feelings

of the people interviewed. It has permitted to have their points of view about the impact of

technologies on their jobs and how they manage it. Their testimonies are anonymous.

To complete this study to understand the new ways to reach customers, 9 people have

been interviewed. Those interviews had three main objectives. The first one was to make an

inventory of fixtures of the Media landscape and how to reach customers, which means if they

make a difference between Media planning and Audience planning and if they know the

functioning of Programmatic. The second objective was to understand their work and to see

what the evolutions were and how technologies have made evolve their jobs. The third objective

30

was to see if they consider that there was challenges for Media, brands and Media agency. This

way, it was interesting to know how they consider their work was going to be in the coming

years and what could be done.

People interviewed all work in the Media field in front (in direct contact with customers

and brands) or middle office (people who manage campaigns to meet with the objectives). They

work in Media agencies or Digital advertising companies. Those people work with all types of

Media, online and offline and are directly confronted to new technologies which modify the

way they organize campaigns.

b- What are the main ideas presented?

Programmatic is one the biggest revolution in the Media landscape of the last years. All

the people interviewed are aware of it and make a real difference between what we called Media

planning and now, more Audience planning. However, they do not make sometimes the

difference between RTB (Real Time Bidding) and Programmatic. By and large, they are

globally positive about programmatic buying and consider that it can give something new in

the organization of a Media campaign. Two of them are not convinced by the pertinence of the

model and do not consider that it will spread to every Media. Others think that it is very positive

and the campaign organizations will be, except for precise fields as luxury for example, totally

based on the model of programmatic buying.

They all agreed for the moment that the luxury field needs to be on the model of Media

planning to ensure the “quality of the impression”, argument highlighted by everyone and

particularly the 2 people who are more reluctant to programmatic buying. For programmatic in

open market, the uncertainty of where the advertisement will occur is also featured and is not

reassuring for announcers. On the other hand, the main advantages pointed out are the quality

of the audience targeted. I have heard from all of them the idea to “get the right audience, at the

good moment and at the good price”. Programmatic is presumed to give, for the moment the

best audience, depending on the quality of the data and it is possible to understand when to give

the good message. Geo-localization or double synchronization permit to help in understanding

those moments. If someone watches an advertisement on TV, he will be retargeted on a second

screen on a very short period. It is what we call double synchronization. Programmatic buying

31

is based on bidding, so, Media agencies will try to get the best target at the better price. But

they all precise that the quality of the targeting is linked to quality of the data.

Data quality seems in fact to be one of the biggest challenges in the years to come

because it will ensure the pertinence of programmatic buying. If Media and Media agencies

manage to prove that they can ensure a good quality of their audience on the good supports,

programmatic has a good chance to spread more. This data also has to be measurable. New

KPI’s can be found and habits have to be more and more analysed. The quality of impressions

is also considered as a challenge. Media agencies and announcers have to be agile and to

innovate in their communication to attract consumers. Even if they did not speak about it

spontaneously, Adblock can divide. Some of the people interviewed considers it as a threat for

Digital. But they consider that solutions are going to be found. On the contrary, others consider

that it improves the quality of the audience. In fact, if a people do not want any advertisement,

he will not be sensible to messages. So it permits to focus only on people who could be sensible

to them. Another challenge is the actual consideration of Programmatic and how to adapt the

message to announcers. Programmatic was used at first to fill the unsold locations on websites.

It has gradually been developed to target people. But it still has the reputation to deliver a low

quality inventory. But beyond those challenges, their interviews indicate that there are limits to

the development of programmatic buying in France.

The first one is legal. On mass Media, except some cases, it is necessary for the moment

to send the same message to everyone at the national scale. Laws become more and more

obsolete, as Programmatic becomes popular. The second limit is technologic. It is necessary

that telecommunication operators (as SFR, Free, Orange or Bouygues Telecom) use the same

technologies for their Internet boxes to help in the development of Programmatic in traditional

off-Media.

Programmatic buying is now considered as unavoidable, even if some people are not

convinced by the model. The understanding of the functioning of programmatic buying will

allow a better analysis of the challenges and will help in the research of recommendations.

32

II/ A media landscape which knows different evolutions in

its functioning

1°) Presentation of the programmatic technology

Programmatic disturbs the Media landscape and ways Media agencies can organize their

advertising campaigns. Understand its processes will allow to understand how Media agencies

can give a precise service for announcers thanks to a better targeting.

a- The model of programmatic buying

Audience planning is a direct consequence of programmatic buying. The most complete

definition should be the one of Yannick Lacombe, Strategy and Numeric transformation

director of France Télévision Publicité (FTV):

“The programmatic buying is a new manner to consider a commercial transaction between

an announcer and an advertisement seller. It is about to introduce a buyer to a real time seller,

through technologies (DSP, Demand Side Platform and SSP, Supply Side Platform) on

marketplaces that can be opened or constrained (Ad-exchange, Private Ad-exchange). The most

usual buying way is the RTB, which means Real Time Bidding of each advertising elements of

a website or an application, on standard display formats or video. What we observe is that we

do not speak only of the Programmatic but programmatics. In fact, the impression acquisition

can be dealt thanks to bidding but also thanks to ID Deals which fix a precise CPT (Cost Per

Thousand). It can be with or without an inventory guaranty. Programmatic is more and more

qualified with labels as: programmatic guaranteed, priority programmatic (preferred deals),

programmatic with private access (private marketplaces), or open programmatic (open

marketplaces). The relationship was an exclusive link between trading desk and an ad-

exchange, we observe that companies which organize Media planning and advertising agencies

can be programmatic deal creators, and trading desks with Ad exchanges, operators of those

deals. Programmatic starts to be protean and complex”24.

24 Définition: qu’est-ce que des achats programmatiques?, Ad-exchange.fr

33

Targeted audience is at the base of Programmatic. To target this audience, it is necessary

to use data and the quality of the audience depends on the quality of the data. As explained in

the previous parts, three kinds of data are available. As for a Media consultant interviewed:

“The first party data is the data which belongs to your announcer. If Carrefour wants

to make programmatic, it wants to have Allocine data for example, and make a deal with it to

have access to its data. It is what we call second party data. Third party data comes from

specialized companies in data mining. They are providers of the data”.

To analyse those data, it is necessary to understand the technology. In Programmatic,

automation is a real technologic innovation but the influence of people is also very important

(Media consultant, data scientists…) to know how to react in function of the progress of

campaigns.

The data is essentially collected thanks to cookies installed on machines. They permit

to build Internet users profiles as age, gender, city, center of interests, navigation historic…

Those data permit to target more precisely the audience. They are managed by databases called

Data Management Platform (DMP). It is a predictive way to target audience. Another way is

declarative when Internet users fill forms for example.

Two things are already sure today: the use of Mobile and Programmatic are going to

spread more in the coming years. In the United States, programmatic market is now around 15

billion dollars with an annual growth of 20%. Business Insider anticipates the fact that around

65% of online advertising will be programmatic by 2020. According to the E-Pub-SRI-

UDECAM-PWC25, for the French market, programmatic buying has increased by 125% in

2013. It represented 117 million euros. PWC estimates that programmatic will represent around

32% of French display market in 2017, 42% for the United States, 30% in Great Britain and

28% in Germany. Digital is the only Advertising segment which increased in 2013.

25 Rencontres de l’UDECAM, Livre Blanc - Les révolutions de l’achat programmatique, 25th March 2014

34

To make an ensemble vision, the programmatic buying can be summarized in this

scheme:

Type of

inventory

(reserved,

unreserved)

Pricing

(fixed,

auction)

Participation (

one seller -

one buyer,

one seller -

few buyers,

one seller - all

buyers)

Other terms

used in

Market

Other

considerations

Guaranteed

transaction

with fixed rate

Reserved Fixed One - One Programmatic

guaranteed,

Programmatic

premium,

Programmatic

direct,

Programmatic

reserved.

Prioritization

in the ad

server,

Data usage,

Transparency

of the data...

Unguaranteed

transaction

with fixed rate

Unreserved Fixed One - One Preferred

deals,

Private access,

First right of

refusal.

Private auction Unreserved Auction One - Few Private

marketplace,

Private

auction,

Closed

auction,

Private access.

Open auction

Unreserved Auction One - All Open

exchange,

Open

marketplace.

The reserved inventory is an advertising space on a publisher’s website that is put aside

for a specific advertiser for an agreed price. The fixed price is any arrangement where the buyer

and seller agree on a flat price that the buyer pays rather than the highest bidder in an auction

environment26.

Four kind of programmatic buying can be done today. A guaranteed transaction with

fixed rate is similar to a classical direct sale, negotiated between an editor and one buyer. Price

and inventory are guaranteed. It is a real time automation process with a targeted audience.

With an unguaranteed transaction with fixed rate, the price is fixed in advance but the location

26 Matthieu Tranvan, 5 paradoxes de l’achat programmatique RTB aujourd’hui, matthieu-tranvan.fr, 2nd August

2015

35

in the inventory is not guaranteed. Private auction is an auction where a group of buyer is

selected. The editor defines the minimum price. Other criteria are activated and give restrictions

to those who participate to the bid. Finally, an open auction is a classical bid, which is accessible

to every buyers. The editor defined the minimum sale price of impressions in its inventory.

Every locations and every announcer can access the bid.

A common mistake is to make the confusion between Programmatic and RTB.

Programmatic in general is to reach the good audience at the good time, and indirectly, at the

better fixed price. In addition to those criteria, RTB includes the notion of auction. Open and

private action are based on RTB model. For a better understanding of the challenges, it is

necessary to analyse processes and actors who make up RTB.

b- Focalization on the Real Time Bidding processes

RTB business network and processes can be represented as followed:

RTB is a Business Model which allows, thanks to a technology based on an algorithm,

to bid in real time on advertising locations online, with pre-defined parameters in function of

the needs and the objectives of the campaigns. When an Internet user selects a web page which

36

uses RTB, the URL tag “calls” an ad-server which makes the link with announcers, ad-networks

or ad-exchanges. The Internet user is targeted thanks to cookies. If some announcers want the

same location, process of bidding appears. If the Internet user who is the target by the announcer

visits a website page, the advertisement impression available on this page will be auctioned.

Depending on his profile and moments, an Internet user do not see the same advertising than

another Internet user.

According to Magna Global, (IPG Mediabrands), transactions in programmatic

represented 21 billion dollars in 2014 for the 35 countries studied. 44% of this amount has been

programmatic (around 9,3 billion dollars). They also predict that more than half of RTB buying

will be for mobile in 201927.

“Website editors continue to sell classically via Media agencies which whom

transactions are made directly. But RTB is taking more and more place”, explains Richard

Strul, Resoneo founder and Vice-President of IAB France (Interactive Advertising Bureau).

RTB has been born the 23rd October 2000, when Google has launched its Ad-words

system. If an announcer wants to publish an advertisement when an Internet user is searching

for a special keyword, he will make a bid to buy this keyword. The announcer who has the most

elevated auction and respects limits fixed (as daily budget or the number of impressions…)

wins the impression and its advertisement is published. All this process of bidding is done in

less than a second (around 120 milliseconds, according to Tradelab). In 2015, RTB is based on

the same model but it includes banners or video pre-roll.

Programmatic was, at the beginning, created to sell the unsold locations, which had not

been sold to announcers. It was a promise to buy a cheaper location but also less qualitative.

But this notion have changed, because of the development of new actors as SSP (Supply Side

Platforms), DSP (Demand Side Platforms) which allow to optimize the Internet user targeting,

the buying of locations and to sell them at the better price. Between DSP and SSP, there is the

ad-exchange platform which permits the consolidation between Offer and Demand and finalizes

the financial transaction. It is a virtual marketplace. Trading desks manage and optimize for

announcers and Havas Media, Display, Video and Mobile Media buying on ad-exchanges.

27 Le Marché mondial de l’achat programmatique augmentera de 52% cette année, Journal du Net, September

2014

37

DMP (Data Management Platform) and others data providers manage large amount of data.

They use first, second and third party data to create audience segments.

Internet giants has invested on this technology as Google which has its ad-exchange,

Facebook has Facebook Exchange (FBX). Twitter has bought the start-up Mo Pub which has

developed its RTB technology. If we take the example of the operation realized by Rocket Fuel

ad-exchange for the Lufthansa Company, they have made an increase of 11% of their

conversions, decrease their CPA (Cost Per Action) on the plane tickets by 50%, thanks to

programmatic behavioural targeting. The theoretical success of programmatic model forces

traditional Media as TV or Radio, to invest on it, and to think about the technologic possibilities

to spread this model.

Those advantages of RTB are possible thanks to the components of the environment of

RTB. But how do they help in optimizing the audience?

c- How entities make Real Time Bidding primordial today?

SSPs are technological platforms, as AppNexus, which permit to sellers to facilitate the

managing of their inventory. Those platforms identify available locations and automate their

sell on ad-exchanges. It permits to gain time for Media sales houses and publishers.

DSPs are technical platforms which negotiate prices with ad-exchanges. Mediamath,

Invitemedia, Turn or TheTradeDesk are examples of DSP. There are 2 kinds of DSP:

- Open APIs (Application Programming Interfaces) which allow to buyers to plug their

own technologies to optimize Media buying,

- Closed APIs which are simple campaign monitoring, which capital is essentially human.

It is an automatic process where a Media agency, for example, is searching for an

available impression to target a precise audience. It gathers different ad-exchanges and data

providers. Agencies and trading desks can apply their different strategies to buy spaces

available on the DSP. As ad-exchanges, some DSPs specialize on Display,Video or Mobile.

Ad-exchanges are virtual marketplaces where sellers (websites editors, mobile

applications, social networks and Media sales houses) meet buyers (announcers, agencies and

technologic service providers). Sellers provide inventories with a minimum price and buyers

38

can bid on it. The highest bid wins the publication. Audience Square, La Place Media,

Facebook, DoubleClick by Google, Hi Media or Orange are famous ones.

Trading desks, for their part, manage and optimize Display Media buying, Video and

Mobile on ad-exchanges for announcers and agencies. It exists two types of trading desks:

- Affiliated structures to Media agencies as Affiperf for Havas Media,

- Independent structures as Tradelab.

In those trading desks, there are “simple” Media buyers but also technologic providers.

The last ones are Media buyers but they also guide the advertising investments of their

customers by building technologic solutions. They can personalize their technologies to answer

announcer problematics but there is also the “human capital”, which means that trading desks

have people who can manage campaigns and provide solutions in function of the objectives as

TradeLab or Vivaki. They know which kind of audience are on ad-exchanges.

Ad-servers permit to manage, in a centralized way digital advertising. It manages

display but also ensures statistics to know the number of impressions generated on a website.

There are two types of ad-servers: editor’s ad-servers which manage display zones on their

websites according to announcer imperatives and agency’s ad-servers which allow to media

agencies to control the productivity of their advertising campaigns. It is composed of two

principal elements:

- A campaign computer manager which allows to input visuals and to configure the order

of displays and the location placements on the website,

- A zone computer manager which configures the number and format of every advertising

location on the website. It furnishes scripts for every zone. It permits to broadcast the

visual.

Finally, DMPs allow to transform data in insights and audience targeting. This audience

is qualified to be transformed in data and utilizable information for Marketing. DMPs nourish

the advertising targeting of the trading desk. The 6th annex, page 73 allows to see the principal

actors who manage RTB.

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2°) A technology which meets different objectives for brands and Media

agencies

To deliver their services and answer to brand strategies, Media agencies have to develop

Programmatic inside their agencies and to manage its issues.

a- Advantages of Programmatic and the need of programmatic technology to help in the

strategic choices

A Commercial Director explains: “The first advantage of Programmatic is the data

part, the targeting part, the contact that I am going to reach. The second advantage that you

are going to give is the notion of costs. Ultra-targeted contact also means performance. […]

You can work, not on short term but on long term, on a tactical way”.

It seems that the more your data is “clean”, the more your audience will be precise. The

highlighted advantages could be resumed in this scheme:

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Thanks to Programmatic, campaigns are more and more measurable and it is easier to

have KPIs and to analyse the Returns On Investments (ROI). From a total theoretical point of

view, Programmatic is now the best way to target precisely the audience and can help in

answering the need for announcers to see what the effects of their investments are, and how

they can improve their campaigns to have ROI. They also know precisely where their

investments are gone and how many impressions have been done.

Programmatic can help in strategic choices, as engagement or branding. Thanks to RTB,

an advertising location, which is not clicked by the Internet user, will not be bought by the DSP

and SSP takes in account that it does not interest the Internet user. Moreover, RTB allows to

target precisely the website pages which can interest the announcer. Only some pages can be

chosen to broadcast a campaign. It allows to announcers to know more about where they are

going to publish their visuals.

To understand what is important in the use of programmatic but also issues that inhibit

its use, Chango trading desk have questioned marketers from the Fortune 500 members. They

have ranked their priorities in the two following graphs28:

28 Que savent vraiment les annonceurs en matière de marketing programmatique, Ad-exchange.fr

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Whether it is the driving or the inhibiting in the use of Programmatic, the issue which

seems to be the most important is the data management. It shows that, if data is well managed

and if Media agencies prove that they control locations of publications, Programmatic has a

chance to spread more in communication campaigns.

In a general way, programmatic seems to be one of the biggest issues today. And the

development of it in digital seems to be, for the moment, a necessity for Media and Havas

Media to find new ways to develop their offers. But is programmatic developed for other

traditional Media?

b- Applications to every Media and evolutions

For TV, as a Media Consultant, “we do not make programmatic buying. If I hesitate

answering you, it is because TV channels pride themselves in making “guaranteed GRP [Gross

Rating Point] cost” and already making programmatic because we give them precise briefings:

targeting, day type, daily pressure… And it is on those bases, those ultra-quantified data that

they automatically program thanks to specialized software screens. They build and rebuild

plans every day to reach the performance objectives. If I tell TF1 or M6 that I want to buy at a

guaranteed costs, it will be a form of programmatic buying. However, it will not be in real time,

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but in advance, some days before the diffusion. Negotiation is neither in real time. It is a

negotiation by mutual agreement and we find conditions to have a GRP cost and the channel

manages the delivering”.

GRP is a pressure grade on a precise target to know how many contacts are going to be

reached by an advertising campaign. It can be calculated thanks to the coverage rate multiplied

by the medium repetition rate. It is one of the principal measures to know the efficiency of the

campaign. TV channels sell screens with a type of audience they know.

The next step will be to target this audience but in real time. It implies that TV will be

personalized to every viewer. The experience has started in the United States and United

Kingdom. French TV channels are working on it. Today, IPTV (Internet Protocol Television,

which means, all forms of TV broadcasted on a network using Internet Protocol) works on a

programmatic system. In the United States, programmatic TV could represents 4% of total

advertising TV turnover. As for a programmatic Director:

“Today, we already have IPTV on the Internet boxes. You can go on replays or TF1

Replay. There is not notion of targeting but you have inventory at your disposal”.

There is a development of audience targeting and buying is automated. In 2015, Canal+

Régie has shown its “All Ad In” project aimed at launching personalized TV.

Problematic of Programmatic are quiet the same for radios. As for an Audio Director:

“All our campaigns will not be in Programmatic tomorrow, but the day after tomorrow,

yes”. He adds: “That’s all new! It is “Work in progress” because audio programmatic did not

exist before, except in the United States or United Kingdom […]. We are starting the first

campaigns […]. The programmatic specificity has come from the existence of an incalculable

number of supports and difficulties to reach audiences in a split environment”.

Three ad-exchanges, specialized in audio have been born to develop programmatic for

audio as Adwave, A2X and Radionomy. Deezer and Spotify develop their targeting on their

platforms and use more and more the data.

Media consultant estimates in general that Programmatic will be harder to apply on

OOH and press. For OOH, a programmatic Director asks:

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“How is it possible to drive programmatic for this offer? We can make automatic and

combine Decaux or Clear Channel inventories but, even if we make this totally automatic, you

do not have audience. If you have your Sephora billboard on digital screens, you can identify

my smartphone to know if I am nearby the screen but you do not know If I will be receptive to

this advertising […]. The challenge for tomorrow will be: how can we add this notion of

Audience planning in this notion of OOH”.

OOH screens are more and more digital and can be personalized. But audience

measurements have to be developed. It is the same problematic for Press but we also have to

understand that Press environment is still changing a lot and we do not know if printed Press

will still exist in the coming years.

Programmatic has a huge impact in the Media environment and changes in many ways

the vision that we can have of communication, thanks to better measurements and a better

estimation on ROI. But what are the challenges of it? How to accompany Programmatic

development?

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III/ Challenges of Programmatic: a need of a better

understanding

1°) A need for brands and Media agencies to understand their audience

Innovation and adaptation are two rules in the Media environment. But what roles Media

agencies can have and how it can influence their environment?

a- Media agencies have to be “agile” and to be creative

Consumers are now multi-devices and are very exposed to advertising. If a person

consumes around 6 hours of Media every day, with the average number of advertisements every

hour, this person could see around 350 advertisements every day and this number can increase

in function of the Media used. Segmentation is harder today and audience is less a monolith.

People are more and more on 2 screens. Double synchronization, permits to target a people on

a second screen after he has watched an advertising on TV. It permits to announcers to reach

him 2 times and to improve memorization.

This is especially true especially as customers can now interact with their brands and

advertising. Advertising has to be done for the customers but also with him. Social networks

and Digital in general permit to interact more with them. However, as they gain power in the

brand image with the developments of links, particularly thanks to social Media, brands and

Havas Media have to adapt their messages and be aware of customer’s reactions.

It is the duty of Havas Media consultants to build multi-Media strategy and to

understand the Media landscape to reach customers. Mass Media are useful to target a large

audience but the principal need today is personalization. Understand channel diffusions allows

to improve communication effects. Media consultants will need to give advises to announcers

and to improve the links between the technical part of advertising and announcers for a better

understanding of what message to give at a certain moment for a certain person. The real added

value for Havas Media is to make understand what the better way to make advertising is.

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Moreover, a Programmatic Director adds: “Programmatic is, beyond targeting the good

audience, you need creation […]. You are going to address to people who are more or less

engaged in a transformation tunnel, in the knowledge of the brand and you decide what message

you are going to give”.

If someone knows the brand, is used to buy its products, an adaptation of the message

is necessary and could be for example an invitation for a private sale. Indirectly, it is necessary

to understand how it is possible to reach the customer without annoying him. Differentiation of

the message is really important and it depends a lot on the creation and which words are going

to be used to attract customers.

As for a Commercial Director, “the biggest issues today, if you want that RTB works

and has sense, is, firstly the quality of your data and secondly, the quality of your advertising”.

One of the biggest issue today for announcers is the “quality of the impression”.

The quality of the creation and location are obviously primordial but the quality of the

data seems to be the most important.

b- Make understanding the benefits of programmatic to announcers

An Audio Director explains that “the issue in programmatic is the data. It is necessary

to have all necessary resources to have a precise targeting. I think it is one of the biggest

challenges. We have technologies to activate data segments, to geo-localize, to make precise

targeting and retargeting. The issue is to have the “cleanest” data, to have a clever and efficient

targeting. The second challenge is to measure those campaign results to learn lessons and

adjust tactics if what you have activated is not pertinent”.

The most important is to improve the quality of the data and to find new ways to measure

customer habits. The more Havas Media will prove that announcers can have good ROI, the

more the use of Programmatic will become widely accepted.

Furthermore, Havas Media has to change the vision of communication for announcers.

Traditionally, announcers have the habit to choose one Media, so they know precisely where

they are broadcasted. With programmatic, you have a better comprehension of your audience

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and data, thanks to precise targeting. However you do not know precisely where your locations

are. A Media Consultant explains:

“If you have to work the audience, those actors want to have guarantees of contexts and

locations in which they are going to appear. They need in priority to know where they are going

to be present before knowing which specific target they reach”.

And it is comprehensible. He has given an example:

“The FDJ [Française Des Jeux] cannot address its message to people aged under 18

and they are really aware on websites where they have appeared. We are going to work more

on programmatic than RTB. We cannot be on open RTB. We are going to search for a specific

website list, safe, secure to ensure a presence on locations which correspond to their target”.

Media consultants have to make them understand that they can reduce the diffusion list

and select specific website lists. There are also more and more brand safety tools as Adledge,

Alenty or Integral Ad Science which exist and help in giving a quality diffusion list. Brand

safety concerns, in fact, every stakeholders. Brand safety tools permit to control where the

publications occur, to respect brand image. It can reassure brands in their list diffusions. It is

necessary to explain that it is possible to control the diffusion environment. It is also important

to explain that Programmatic is not only RTB and it is possible to control diffusion. A

Programmatic Director tells:

“I think the priority issues are reassure and reinsure announcers on the pertinence of

Digital and that is an unavoidable Media. The 0 default cannot exist, you will not necessarily

see your brand. But engagement is measurable. Everything is measurable in Digital. Your

money is well invested”.

Brand Safety tools also allow to detect robots. Considered as a real problem, many

studies have estimated that around 25 to 50% of traffic on Digital is not generated by Humans

(and it was only 6% in 2011)29, causing a reckoning loss of 5 billion dollars.

“We cannot see our announcer in the eye and say that the 25 million impressions I

diffused have not been seen by robots. Today, we cannot guarantee that. But it is the case of

Digital since the beginning. It is a big issue. There is KPI notion (click rate, bounce rate, arrival

29 Internet: la fraude au clic fait planer une menace sur le secteur, Les Echos, 22th September 2014

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rate, spent time…) which allows to know if you are a robot or a human. There are programmatic

solutions which allow to know ahead if there are robots”, admits a Programmatic Director.

Education about Programmatic is one of the biggest challenge in the coming years for

Havas Media. It is important to make understand that the diffusion environment can be

controlled. But French law can be restrictive.

c- But the French legal setting is obsolet

One of the law which legislates advertisement is the Law n° 93-122 relative to

corruption prevention, economic life and public procedures transparency, approved the 29th

January 1993, which is also Sapin Law, in reference to the name of the minister who developed

it. The article 18 highlights that “every producer, service provider, wholesaler or importer, has

to communicate to every product buyer or service provider for a professional activity, who

makes the demand, price scale and selling conditions”30. This article, for example, is

considered as obsolete in the Media environment. It is not possible to know, for RTB the price

of the impression before the publication and the process of bidding.

With the Macron law discussions in 2015, Digital should be under the legislation of the

Sapin law. The Sapin law has permitted to have more transparency in the sale of advertising

locations. One more problem is the status of seller – buyer. With the Digital, and particularly

RTB, locations can be bought by actors (“retargeters”, trading desks…) and resold. Digital

needs a new status of buyer and reseller, as for the UDECAM (Union Des Entreprises de

Conseil et Achat Media). They want to create a new status of “location transformers”, for those

who buy locations and enrich it with data to sell it again in a global service setting. The president

of the UDA (Union Des Annonceurs), Pierre-Jean Bozo explains:

30 Legifrance, LOI n°93-122 du 29 Janvier 1993 relative à la prévention de la corruption et à la transparence de

la vie économique et des procédures publiques

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“We do not want to come back on the Sapin law. We want its maintenance, but with an

application circular concerning online advertising and the respect of the non-confusion

principle between the buyer and the seller of advertising locations”31.

UDECAM, SRI and UDA are trying to change the status of those who buy locations to

make understand that they are now, more “Marketing providers”, thanks to data than simple

buyers. They want to make them remunerate, not on the volume but on performance and time

spent on the campaign. They also think about the legislation about targeted and locals

advertising. A programmatic Consultant explains:

“French law stipulates that, at the national scale, everybody has to get the same

advertising, it is the law”.

It is, for the moment, impossible to make local advertising on mass Media as TV. If

Programmatic is developed to traditional Media, French law will have to change.

Digital needs a setting and traditional definitions are jeopardized. However, legal

settings are not the only limit.

2°) Technologic limit

One of the future biggest limits to the development of Programmatic is the technologies

restrictions, hold by telecommunication operators. Moreover, more and more tools on the

Internet have been developed to block advertisements on the Internet.

31 Loi Sapin et Internet : Annonceurs et agences médias prêts à l’autorégulation, Les Echos, 26th March 2014

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a- Telecommunication operators and the need of unification

“There already are synergies which are set up but there are so many actors… If we take

the topic of TV and its big issues, as we will not be able to identify who is behind his TV and to

standardize Internet boxes, in order to have a unique and identified information, we will not be

able to make case by case”, adds a Programmatic Director.

Technology has to be at least national. If telecommunication operators agree to unify

their technologies and to harmonize the way they gather data, it will be possible to make a better

targeting.

There are 5 principal operators in France: Orange, SFR, Bouygues Telecom, Free and

the MVNOs (Mobile Virtual Network Operator). Each one of them has its particular technology

to understand their audiences. If traditional Media, particularly TV and Radio, want to make

Programmatic at the national scale, on the Digital signal of Internet boxes, it is necessary to

harmonize French telecommunication operators technologies.

A unique technology to gather data from those companies would permit the

development of Programmatic on traditional Media. However, Media has also to face other

problems linked to technology.

b- The case of Adblock: a threat or an opportunity?

Created on December 2009, Adblock Plus is a software which permits to obstruct

advertisements on Digital. Adblock is the most popular Google Chrome extension with over 40

million users and Safari extension32. It is free to download and to use. Adblock has been

critiqued due to its white list, which permits to publish advertisements judged “non-intrusive”.

In June 2013, Google advertisements have been added to the white list thanks to a financial

agreement between the two sides (around 20 million dollars could be deposited by Google every

year to Adblock33). A Media Consultant considers in fact that:

32 Google Chrome Webstore 33Gilles Tanguy, Les logiciels bloqueurs de pub vont-ils tuer le Web ?, Capital, no 276, October 2014, page 48

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“They do not talk about it a lot. But when we see how much is lost, it is a consequent

budget which flies away. It is 8 billion34. It is huge. As for me, Adblock is an extortion”.

However, other people think, reflected by another Media Consultant:

“We are able to know lots of things thanks to Internet boxes. My data is furnished. I

want a ROI if they sell my data. […] It does not disturb myself. It is a « win-win situation ».

Digital is a canal. […] ». She adds, about Adblock: “if there is a democratization, this can

becomes dangerous. It is necessary to develop lobbies. However, it requalifies the audience.

The most refractory ones have their needs. They do not need advertisements. We question

ourselves too. Doctissimo for example. The website is better and with less advertisements. We

have to gamble on creation, to create dreams”.

In fact, if a people really do not want to see any advertisements, even if it is published,

he will not care about it. So it could, in a way, refine the audience. It is necessary for websites

and Havas Media, for the future, to make understand that advertising can be interesting for

people and to choose for them advertisements link with their centre of interests. Websites could

also make understand that they need advertising to live but also make understand that it

advertisements can be a win-win situation.

Those limits have to be overtaken in order to help in the development of Programmatic.

The next recommendations can help in overcoming challenges presented.

34 Olivia Solon, Google spins ad fraud-busting web with spider.io, Wired, 24th February 2014

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IV/ Havas Media has the possibility to develop Audience

planning, by accompanying the evolution of the Media

landscape

1°) A need to help in change

Programmatic issues are numerous and Havas Media can take advantage of it. Havas

Media has the tools to adapt but it needs principally a mentality change.

a- How to restrict data and technical limits?

Media and Media agencies take seriously into account the issue of data safety.

Integration of DMP inside Media agencies allows to centralize their data and those of

announcers. However, a Media Agency Director explains:

“I am going to be a little weird about this. If we want to have an efficient DMP, we have

to put Media data with CRM data […]. I do not think it is positive for our announcer to give its

CRM data. Because it is a very sensitive data. I am comfortable with hosting DMP in the

announcer’s company, to guarantee data safety, to guarantee to my announcer that I am not

going to use its compartmental data for others announcers, who are not necessarily its

competitors. A potential car buyer can be used for my insurer customer”.

Data safety is an issue and if Media agencies as Havas Media want to keep DMP inside

their companies, they have to be aware of its security. About technical limits, it is necessary to

develop a unique technology to be shared with the ensemble of actors, Media and

telecommunication operators.

“Canal+ has announced, a month and a half ago, that it wanted to take the leadership

in programmatic buying in TV. Why? Because they have 11 million subscribers. They have rich

information. They want to make advertisement personalization through their boxes

Canal+/Canal Sat with other telecommunication operators as Free, Orange, Bouygues and

adopt the same technology to make Ad-serving through every boxes of French homes.

Obviously, if they do not convince others, they will do it alone” explains an Audio Director.

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People interviewed in general want the development of a “lobby” to unify the

technology. Telecommunication operators have to pool their inventories. Canal+ for example

and Havas Media should develop their systems and gather a maximum of actors to show the

advantages of Programmatic on traditional Media.

“It can be positive, not for the biggest TV announcers, but for those who cannot afford

to be on TV” adds a Video Director.

If Canal+ wants to develop a unique technology, it has to show in what ways

Programmatic can be positive to the ensemble of actors, and Havas Media could help in that

change.

Another technical issue for the development of Programmatic to traditional Media, is

the “fluidity” of the watch or listening. An Audio Director asks:

“It is a question to be studied: who do you replace? If we switch a film by another inside

the same announcer, there is no problem, it is inside the same group…”

It is necessary to develop the technology to unify the advertisements (advertisement

duration, number of screens…).

To fight against robots, rules can be found. Using safety brand tools as Spider.io, bought

by Google are a solution. Havas Media organizes itself to make pay the advertisement that is

really seen by humans. In the United States, the IAB has published 3 principles that they

recommend to adopt:

- To settle technologic tools that permit to fight against the fraud,

- The duty to precise to the announcer the source of the website on which advertisement

is published,

- To have transparency principles in the process of buying.

Another way to fight against online advertising fraud is to modify ways Havas Media

can measure advertising campaigns. KPIs as CPT (Cost Per Thousand) or CPC (Cost Per Click)

are very sensitive to fraud. The logic would be to compare the turnover generated by those

advertising campaigns. Robots can imitate more and more precisely human comportments but

they cannot reproduce real conversions (when an Internet user make an action to have more

information on a product or to buy it) or to generate turnover. Analysing turnover permits to

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have a clear evaluation of the success of a campaign. By measuring turnover, Media Consultant

can understand the consumer engagement and advertising efficiency.

Stephane Hauser, general director of IAB in France explains that they “are not police

officers […]. It is essential to settle safeguards”.

As explained before, Law has to be changed and it is the gathering of every actors

(Media, announcers, Media agencies) which could change the French principles.

b- How to consider the Adblock software?

Except a legal restriction, Adblock is going to spread more. From 21 million users in

January 2010, we have reached the 181 million in January 201535. It is a mainstream

phenomenon and it cannot be ignored. Native advertising, seems to be a good answer, because

native advertising content is impossible to identify and to remove. Native advertising is a form

of online advertising that furnish contents in the context of user experience. The Internet user

will have a content linked to its centre of interests and is included inside other contents.

Sponsored links of LinkedIn, Google or Twitter are examples. Another solutions is not using

third party data, which are detected by Adblock.

Websites can also react by creating subscription offerings. Subscribers are willing to

pay for quality digital content. It is also a solution to monetize their content. But this solution

is not possible for every publishers. Some of them ask Internet users to deactivate their Adblock

to see the content and make them understand that advertisement is necessary to their Business

Model. It is also possible to “monetize” an Internet user who has Adblock by making him

complete a short survey for example. Getting data is a way to compensate the loss of the

advertisement. Finally, blocking Adblockers can be a solution for Havas Media but it implies a

decrease of the website traffic.

Adblock has to be seen as a way to refine the audience. Adblock could be considered as

a form of trading desk. If people do not want to see any advertisement, it will be hard to prevent

it, except if a law is voted. Publishers have to use Adblock to have an audience more disposed

35 Patricio Robles (Tech reporter at Econsultancy), Seven ways publishers are addressing ad blocking,

Econsultancy.com, 2nd November 2015

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to have advertisements. Publishers, Media agencies and Adblock have to work together to make

understand to the audience that advertisement can be interesting for them. Principles have to be

found about the white list but it is the duty to Media agencies, publishers and Adblock to think

about those principles together.

c- A need of changing of the law for this field

About the existing law, UDECAM, SRI and UDA have to gather and make concrete

propositions, in agreement with announcers and Media to change the vision of the buyer and

seller on the Internet. An Audio Director explains:

“At the UDECAM, we try to make understand that we are still not only buyers but we

deliver Marketing performances”.

Dialogue between announcers, Havas Media, Media and the government is necessary to

make evolving laws and to help in the development of Programmatic.

The creation of a committee, headed by Havas Media and other Media agencies, to help

in the development of Programmatic and the adaptation of the Media environment to it could

be a solution to help in changing. This committee could write an ensemble of principles to help

in the transparency of data and exchanges between actors. They could also help in the

implementation of an Ethic in the field of Programmatic.

3 major rules have to be developed: the need of transparency in data and financial

exchanges, to modify the concept of buyer and seller, and finally an Ethic to help in the

development of Programmatic, respecting life privacy. Beyond this, it implies a change of the

role of Media agencies.

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d- What about ethics?

As for the 3rd Barometer of the French confidence in Numeric (2013), leaded by the

IDATE (Europe Telecommunication and Audio-visual Institute), 55% of people are aware that

their data can be used for advertising and 82% say that they are disturbed by those practices,

particularly for data linked to geo-localization or social networks. Respecting private life has to

be a priority for the actors of the Media sector. Transparency relative to informatics has been

settled in January 1978. This transparency has to be developed to every actor, particularly Havas

Media in their processes but also their use of data.

Data providers could also ask themselves if every industry can make programmatic. Is

it possible for the funeral industry, for example, to make Programmatic? What about the divorce

industry? To what extent can we gather people’s data? Programmatic is linked to the content of

the websites visited. But there are some topics which are very personal and people should have

the control of it on their laptops. It is not a problem if one person uses every time the same

support. But our tools (TV, laptops, radio…) are shared. And sometimes, people do not want

to make know that they have been on websites to see particular contents (as divorce for example

or a dating site). An Audio Director explains:

“Programmatic implies an individual consumption”.

By and large, it is necessary to think about an ethic on every industry which affects

emotions, or could create addiction. People should always have the choice, before opening their

browsers to accept programmatic advertising.

Moreover, it is also important to take into consideration the importance of commercial

stimulus on our brain. Since around ten years, thanks to brain medical imagery we have new

information about the unconscious impact of those commercial stimulus. 90 to 95% of our brain

activity is unconscious. It implies that stimulus have an indirect impact on our consciousness

and can influence ourselves. Most of our choices are influenced unconsciously. To see a brand

several times, with a pleasant stimulus makes us preferring this brand. As for Arnaud Pêtre36,

searcher at the UCL (London’s Global University), we are not equal in front of advertising.

36 Arnaud Pêtre, searcher in Neuromarketing, Publicité, “Part de cerveau disponible”… Et libre-arbitre, Etopia

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Younger people or more manipulable people are more sensitive to advertising and less able to

argument against it. An agency director explains:

“By making retargeting, do I harass my customer? Which limits do we choose in the

rhythm, frequency and duration of exposure? It is a real subject but also a subject of brand

control”.

So we could ask if we can target everyone, particularly with Programmatic which is

based on repetition and creative message which are the more positive to make buy announcers

products. Research development has to be developed.

2°) To develop research and rethink the role of Media agencies

Havas Media and Media agencies have to evolve in their conception of how to be

remunerated. But it implies an “education” with announcers and make them understand that a

new remuneration can cause a win-win situation.

a- A need of change of the Media agencies remuneration?

We are now in front of a contradiction for Havas Media. Companies have to spend the

minimum money for the best campaigns. So it implies that the most effective a campaign is,

the less money can have a Media agency.

Most of the remuneration of Media agencies is based on the percentage of bought

volumes. Media agencies and their Media consultant need more and more to be paid on

honorary and time spent. For a better understanding of this issue, a Programmatic Director tells:

“Everything is linked. You cannot seek for someone, and tell him ‘now, you are going

to generate 4 000 clicks on my website in two days’, qualified click, which mean that people

have stayed at least 30 seconds and at least on one website page, if behind, you have a bad

message with an ugly banner… You have to advise and bring your customer directly toward

the message that he has to make, to whom, how and after you will analyse the performances

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that you have on your website. But to analyse alone 10 campaigns and to consider that the one

which has been the best performer is the one which has made the best click rate is wrong today.

Activations are completely different in function of actors and the way it has been broadcasted”.

Another Media Consultant adds:

“Before, I was in a communication agency. We worked day and night by passion. It is

a quality engagement. We had reserve to demand our costs. We are passionate but sometimes

poorly granted. We are in a service industry. We have to anticipate demands and to get a

natural momentum. We need a remuneration for every service. We need a Consultant price to

be seen for each customer account with an accompanying defined on a precise time. Roles have

to be defined. The human impact has to be defined. We have to add value to intelligence”.

But this remuneration has to be legislated or announcers will have to understand that all

their performances cannot be measured and they may have to spend more for better results. This

evolution has to be leaded by Havas Media and other Media agencies.

Creativity is also taken into account. Havas Media have developed brand content

structures and studies as Meaningful Brands, which can be used for all Havas campaigns but it

is not directly paid for that activity. Media agencies are guarantor of quality of messages. The

Digital adaptation of those messages to good audiences is a determining know how.

b- To develop researches about data

The people interviewed highlight the fact that Havas Media has to analyse its data and

develop departments to help in the development of programmatic for its announcers. With an

audience more and more fragmented, Programmatic seems to be necessary to really target the

audience. A Media consultant explains:

“We could maybe have an area of expertise, additionally to trading desks, to gather

data. It means to create data segments and test them. We are nourished every day by our

campaigns and we do not gather collected data. And I think we could do that thing. We could

have partnerships to differentiate. […] We must have dedicated people who make researches

to see how it works, how we can move forward”.

58

A Media Consultant adds that “we have to personify changing. We do not have enough

researches nor ‘geek cells’. How can we work on a project without having the sources? We

need an R&D team”.

Programmatic could be for example developed in function of this scheme:

In fact, every step could be analysed to see in what ways Programmatic could help in

the communication of a brand. When, precisely, is the better time to communicate on a brand,

regarding the steps of a consumer in front of a brand?

Developing data researches will allow to help in the strategic choices and in the

development of Programmatic. It will permit to understand how a campaign can be efficient

and it will allow Media agencies to simplify processes and be quicker in the development of

recommendations.

59

c- A need to build Media planning thanks to Audience planning and to accompany the Media

environment to change

All issues approached are, for the most part, linked to education. Audience planning has

to be integrated to the Media planning strategy. For the moment, it is considered that Mass

Media strategy is necessary to reach particular objectives (reputation for example).

“You do not have the same age than me. You will see advertisement on products that

concern you and me, on product that concern me. So, I think that brands will suffer of that.

They would live with a generation and die with it. And I think that ultra-targeting has its own

limits. It is only one component of communication”, explains a Video Director.

It seems, for the moment, that the better solution is to mix Media and Audience planning

to reach with certain objectives. It is necessary to educate on:

- The use of Programmatic: Havas Media and programmatic actors have to show and to

explain that diffusion can be controlled and can be made to measure, depending on the

brand,

- The new role of Media agencies: they are now more and more communication

consultant agencies, and not only locations buyers. They aggregate data and organize

their campaigns in function of the data analysis. The ways Media agencies are

remunerated have to be discussed and their status renewed,

- The new links that have to be found between Media, Media agencies, announcers, the

government and Telecommunication operators for a better understanding of everyone

businesses to allow Programmatic to develop and to create “international champions”.

Dialog and the setting up of principles for issues presented seem to be necessary. But it

needs, from every actor to arrange win-win situations.

60

Conclusion

Programmatic creates a new order. It changes ways to reach customers by analysing

their data. Media apply their technologies to find their audience. But it seems that the next step

for Television, Radio and OOH is to make it in real time.

It implies that telecommunication operators have to unify their technologies to gather

data. Moreover, new principles have to be found to renew the notion of seller-buyer and to

change Media agencies remuneration. Adblock is also to take into consideration and to make

understand to people how advertising can be interesting for them. But the highest issue is to

have the better data possible and to be able to analyse it. Multi Media strategy can help in

understanding customer behaviours. Media Consultant will need in the future to understand

audiences and Media landscape to answer to objectives.

But beyond those issues, Media actors have to understand each other Business Models.

Announcer have to understand that they could pay more to reach a better audience. In the same

way Media agencies have to reconsider their roles, to become partners which can analyse data

and to give pertinent recommendations. Ethics is here important to think about data security

and privacy. A committee represented by all actors, Media, announcers and Havas Media could

help in the implementation of think-tanks to think about this ethics.

In this ensemble of evolution, Havas Media has to take a central role. The building of

dedicated teams on data research and Ethics could help in the development of Programmatic.

Moreover, Havas Media has to think again its role of Business partner and to explain that it is

a service industry that can give data to advertising and understand how to reach audience at the

perfect time.

But we have to understand that Audience planning is not going to remove Media

planning because objectives of each one seem to be different. As for a Video Director:

“It is not one against the other. This is one with another: what are the best combinations

in function on the public targeted”.

From a certain point of view, Media agencies are central in all issues presented. They

have to innovate constantly and transparency seems to be one of the most important keyword.

61

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64

ANNEXES

1st Annex - PESTEL analysis of the Media landscape

- Political environment:

Opportunities Threats

- A central position: Fleur Pellerin

encourages dialogue between the

different actors as announcers, Media

agencies, Media and government to

find solutions in the renewal of the

Sapin law.

- To Allow lack of transparency in the

processes of Media buying. Media

agencies which have developed

Media sellers department are tempted

to choose their own prices to

compensate other losses.

- Economic environment:

Opportunities Threats

- Digital brings lots of opportunities in

advertising: Programmatic

advertising is spreading and is a good

answer to the need of transparency

and measurements in advertising

efficiency.

- Digital is also disrupting the Media

environment: more and more contents

are easily accessible freely. Press

Business Model is still modifying,

- With the development of offers,

audience is fragmented.

65

- Societal environment:

Opportunities Threats

- Media actors can organize

committees to help in the

development of ethics and to

organize themselves to change their

Business Models and find new ways

to finance their Business Models,

- Media actors seem to be more and

more willing to give transparency to

their processes.

- Lack of “confidence environment”:

There is a need of transparency

between Media actors,

- Lack of transparency with

consumers: Consumers can consider

as intrusive the fact that their data

are “tracked”,

- Adblock is more and more used to

block advertising.

- Technologic environment:

Opportunities Threats

- Digital and programmatic tools allow

to have better measurements in

advertising efficiency,

- Brand safety tools allow to delimit the

diffusion environment and can

reassure announcers.

- Lack of technologic unification

between telecommunication

operators. They use for the moment

their proper technologies to gather

data or track customers. Coordination

between these actors would help in

the development of programmatic

advertising.

- Ecological environment:

Opportunities Threats

- Programmatic help in the automation

of processes,

- Press crisis, largely due to Digital

make decrease paper publications.

- Data storage and Internet tracking

imply technologic logistic to keep

those data. But this logistic needs

energy.

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- Legal environment:

Opportunities Threats

- A possibility to legislate about

transparency on processes for Media

agencies,

- Possibility to unify by the law the use

of the same technology for

communication operators.

- Immobility on the actual Sapin law:

There is a need to modify the law to

permit to Media agencies to make

advertising targeting and to allow to

make more local advertisements.

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2nd annex - 5 Porter forces analysis on the Media agencies environment

Negotiation power of suppliers:

Opportunities Threats

- Almost all Media agencies have

developed their own Media sales

houses. It allows to have more control

on prices and Media campaigns.

- The development of external Media

sales houses with the biggest websites

in France and which could drive

down prices.

Intensity of the force: 2/4

- Negotiation power of customers:

Opportunities Threats

- Customers are more and more willing

to interact with advertisements. They

understand more and more that

advertising can be a service and help

them in the choice of a brand.

- Adblocker software are a big issue for

Media agencies. Customers can now

easily and legally download

adblocker software to block

advertisement on their devices.

Intensity of the force: 3/4

- Risk of potential entrants:

Opportunities Threats

- Innovative companies in Media (Ad-

exchanges, trading desk…) can be

integrated to Media agencies. They

need each other to develop their

businesses.

- The highest threats for Media

agencies are new entrants which are

totally transparent on their processes.

Intensity of the force: 1/4

68

- Substitution threats:

Opportunities Threats

- Integration of DMP inside Media

agencies can be a positive potential

and help in the securing of data.

- Integration of Media consulting

inside announcers could be a

potential threat for Media agencies. It

could permit to have directly

announcers data mixed with Media

data.

Intensity of the force: 1/4

- Intensity of competetition:

Opportunities Threats

- Competency of Media agencies

forces this industry to innovate and

integrate the different new actors of

Digital.

- Integration and development of

Programmatic along with the

development of transparency are 2

big issues for Media agencies if they

want to survive in the years to come.

Intensity of the force: 4/4

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3rd annex - Audio characteristics in France, Mediametrie Global radio and

Kantar Media, 2014

70

71

4th annex - Video characteristics in France, Mediametrie Home Devices and

Global TV, 2014

72

73

5th annex - Publishing characteristics in France, Press Observatory, 2014

74

75

6th annex – Programmatic ecosystem and examples of principal actors