Facebook and Google Third Party AdTech is Dead
- by Rafaela Baquero | December 5, 2018
- Facebook Advertising
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As seen on Venture Beat.
Consumer Acquisition said it believes Facebook and Google third-party adtech is dead. Or perhaps the way to say it is, “Adtech is dead. Long live adtech.”
During 2018, the optimization algorithms for Facebook and Google Universal App Campaigns (UAC) have dramatically improved, leveling the playing field between advertisers both large and small.
The duopoly’s native adtech has improved such that advantages once held by third-party software-as-a-service adtech providers has significantly diminished. Brian Bowman, CEO of Consumer Acquisition, said in an interview with VentureBeat that his company saw the writing on the wall and decided to change.
Consumer Acquisition is a Facebook and Instagram marketing partner, and it works with Google UAC, Snapchat, Pinterest and IAC. So it kind of sounds like the company is saying that its own business is dead. But it’s not quite that.
To be successful, social advertising technology companies must focus on cross-platform campaign management, advanced creative reporting, and workflow automation, Bowman said. In other words, the bar is higher for being useful as a third-part adtech company.
In direct response to this year’s optimization algorithm improvements from Facebook and Google UAC, Consumer Acquisition has reduced the cost of its platform to 0.7% of media spend with a maximum monthly cap of $15,000.
“It takes a mental leap of faith that this is in your best interest, but their algorithms are more efficient,” Bowman said.
In addition, the company’s AdRules self-service platform now supports Google UAC reporting, which offers mobile app advertisers and lead generators a self-service media buying solution and advanced reporting platform.
Back in February, Bowman said that the company found that the Facebook optimization algorithm
was better, and that the native tools for both Facebook and Google UAC had gotten much easier to use.
“People refer to Facebook and Google UAC as the duopoly, but I think what they are trying to do is lower the skills required for successful advertising, and, in doing so, level the playing field between very larger advertisers and very small advertisers,” Bowman said.
The companies simplified how advertisers managed media buying and bidding, he said. And so Consumer Acquisition shifted to focus on the creative marketplace and software that helps advertisers identify and resolve creative fatigue and audience saturation, he said.
“We’re so confident in our approach and the direction that the industry is headed that we’ve radically dropped the fee we’re charging for our self-service software,” Bowman said.
Consumer Acquisition isn’t the only company cutting prices for social campaign management software in the adtech market. Marin Software, a public company offering a digital marketing software for performance-driven advertisers and agencies, also recently announced shifting their model to a flat platform fee, rather than using traditional pricing as a percentage of digital ad spend.
“I wouldn’t go so far to say adtech is dead,” said Jessica Hasenplaugh, head of user acquisition at Berlin-based mobile game publisher Wooga (which was just acquired by Playtika), in an interview with VentureBeat.
Wooga is a customer of Consumer Acquisition, but Hasenplaugh acknowledged things are changing.
“I would definitely say we are saying a lot of automation within the work we have historically done within the two biggest ad networks, Google and Facebook,” she said. “We are focusing on things that can be done, like focusing on creative. Creative is one of the things that can’t be automated by the big ad networks. There are other things that we do like leveraging our data, which is getting better, and better understanding our user base. We find where we are wasting and eliminate that, and we deal with ad fraud. We focus on other networks where we can benefit if we put some time and effort in.”
She acknowledged that you won’t have to make so many campaigns for a single game and change those campaigns on the fly as much as in the past.
Bowman believes that any adtech company that simply tries to keep up with Facebook and Google native tools capabilities, or those that have built proprietary optimization or AI algorithms, will see the value of their solutions rapidly drop to near zero.
“Before February, our old strategy was running high number of ads, and we were doing may five to 10 changes per ad per day,” Bowman said. “That technique no longer worked. It was both good and bad, as it radically simplified the way we were running on Facebook.”
Making frequent changes using third-party tools was no longer efficient.
“Before February, it was about how smart your quantitative folks were at changing things,” Bowman said. “Now it’s easier to run the ads. So that means creative is the most important part of advertising. You can control that. In the past, most adtech partners were not creative platform partners. They were not good at it. Now there’s less value in the adtech stacks. So the creative has to step up.”
One byproduct of that is Consumer Acquisition is hiring more talent that is good at creative advertising, rather than simply focus on AI to improve creative materials.
“This is going to be a human-driven business for five to 10 years,” he said. “We brought in 50 editors and trained them. For the foreseeable future, humans will do the work in creative analytics. The opportunity is to become good at creativity. The question is how you evolve your creative thinking.”
Hasenplaugh added, “You might try to automate things, but that will just open up questions, and the people who work on this will try to find answers to the questions. I don’t see AI eliminating our jobs.”
Consumer Acquisition’s AdRules software optimizes the social advertising processes with workflow automation, bulk ad creation, bulk audience creation and creative development at scale.
Advertisers can reduce time spent on competitive tasks like building ads and adjusting bids and managing budgets due to AdRules’ automated capabilities.
AdRules also offers a creative analytics solution with reporting views not available in Facebook or Google’s native tools. Advertisers can see images, videos and graphs with rolled up data, cohort reporting and advanced tagging as well as view key performance indicators (KPIs) from multiple sources in one dashboard, including APIs, measurement partners and proprietary business intelligence data.
Additionally, to maintaining financial performance, the platform can deliver fresh videos and images sourced through its Creative Marketplace.
Consumer Acquisition was founded in 2013, and its customers have used its tools to create more than 300,000 videos and acquire more than 150 million app installs. Its customers include Glu Mobile, Wooga, Ember Entertainment, Ford, Checkout51, Autogravity, and more.