Tim and fellow panelists Jeff Green (CEO, The Trade Desk), George John (CEO, RocketFuel), and Joe Zawadzki (CEO, MediaMath), agreed that transparency is key and that the human element in programmatic buying can inform digital ad buys. Tim stressed that media buyers must “know what [they're] buying” and actively monitor their own publisher networks while remaining vigilant in defining whitelists, blacklists, and filters to protect their brands.

Take a look for yourself and learn how marketers are getting beyond the blackbox and reintroducing the human element to the programmatic equation.

RampUp 2013: Programmatic Buying from LiveRamp on Vimeo.

If you’re interested in learning about these disruptive spectrum shifts, click here to read Tim’s latest LinkedIn Influencer post or check out the video below:

I’m answering some of the insightful questions on this subject that were posed following our recent webinar: Programmatic + Premium. Thank you to those who emailed and tweeted us these additional questions.

Q: For buyers who would like to get into the programmatic world for the first time, which is the best route to take: work with a Demand-Side Platform (DSP) to launch a campaign, or integrate directly to an ad exchange?

A. This is an interesting question. At the end of the day, I think it largely depends on buyer’s level of sophistication. If a buyer has used programmatic tools in the past, the buyer probably won’t have any trouble directly integrating with an exchange, setting up an account and buying inventory directly. OpenX provides buyers with the ability to do just that.

On the other hand, if buyers don’t have the bandwidth or internal expertise in programmatic trading to take on that function themselves or are new to programmatic buying, they’re probably best off finding a DSP partner to manage those buys on their behalf.

Q: Will programmatic trading be efficient on computers, iPads, mobile platforms and across all digitally connected screens?

A: Yes, absolutely. From our perspective, programmatic trading is generally agnostic to the screen. In other words, programmatic trading comes down to connecting buyers and sellers, so the screen type – be it desktop, mobile, tablet or connected TV – is irrelevant. That being said, there are certainly nuances associated with various platforms that buyers, sellers, and the partners that they leverage for programmatic trading need to contemplate such as the lack of cookies on mobile apps.

Q: If publishers don’t want to cordon off inventory from potential buyers, would Supply-Side Platforms (SSPs) be a good solution for publishers because they market their services to provide strong yield management across many buyers?

A: Ultimately, no. In our view, publishers benefit most when they allow all demand channels to compete simultaneously for all impressions. That scenario makes no distinction between inventory as designated for guaranteed buyers vs. non-guaranteed buyers. Obviously, the publishers need to have controls with respect to participation, particularly in terms of price floors and the ability to block buyers they don’t want to access their inventory through a particular channel. Bu, in an effort to drive up holistic yield, publishers need to allow all demand to compete simultaneously for their inventory.

The SSPs only work with a publisher’s non-direct sold or non-guaranteed inventory; they don’t have access to inventory that’s sold by the publisher’s direct sales force. These kinds of silos are sub-optimal for maximizing overall yield.

Q; Right of First Refusal was implemented as a daisy chain before Real-Time Bidding (RTB). Since the advent of RTB there is no daisy chaining. How is OpenX implying that it will be implemented within RTB?

A: Right of First Refusal is actually one of the first executions of Programmatic Premium, and it’s one we provide publishers today through something we call Deal ID. The way that works is rather simple. The publisher and buyer enter into a private deal, and once it’s consummated, OpenX will send the RTB request to the buyer – along with the Deal ID. If the buyer opts to bid on the impression based on the agreed upon terms of the private deal, that buyer wins the impression. If the buyer passes, the impression is sent to OpenX Market.

Q: Programmatic Premium is ultimately about mapping the data models of buyers with that of the sellers, and building inter-ad server pipes. Is OpenX delivering these services now?

A: This question is addressing an element of programmatic trading that enables buyers and sellers to create direct relationships, and the publisher giving its buyers the control to identify the impressions they want from within the publisher’s ad server. RTB has allowed publishers and buyers to consummate this kind of relationship today.

Historically, this kind of trading has been done in a spot market, but when we shift gears to Programmatic Premium, we’re talking about moving it to a forward market that tends to have more premium inventory. OpenX is delivering the ability for buyers and sellers to consummate deals in the forward market now, where the buyers are able to influence the impressions that are delivered to them.

Q: When do you believe the online world will be mature enough that publishers can purchase all of their tools from a single provider, and will OpenX be the first to provide tools beyond ad serving?

A: Actually, we’re in that world today. At OpenX, we see our mission as helping publishers maximize all of their digital advertising revenue. Let’s break that down a little to see how that applies to the tools we offer publishers.

Publishers have direct sales teams that go out and sell packages of premium inventory to advertisers. The publisher uses our ad server, OpenX Enterprise, to schedule, forecast and execute those campaigns.

All of the inventory that’s not sold by the direct sales force usually gets sent off to ad networks or other non-guaranteed providers. We have a yield management solution – integrated into the OpenX Enterprise ad server – that optimizes non-guaranteed, non-direct sold inventory.

The third slice of indirect demand stems from the exchange environment. OpenX Market, one of the world’s largest and most vibrant exchanges – is also directly integrated into OpenX Enterprise.

So from our perspective, we provide publishers with all the tools they need to sell, manage and optimize 100% of their non-search digital ad inventory.

Be sure to download our white paper Programmatic + Premium to learn more.

If you have a question that I didn’t answer, please share it with us on Twitter #ProgPremium or email me at progpremium@openx.com and I’ll be answering those next week.

Now to the questions:

1. What is programmatic buying, and does it apply to Real-Time Bidding (RTB) only? 
2. What does “first look” mean? 
3. Now that publishers are getting more sophisticated with yield management, how do you see Programmatic Premium working in concert with those new strategies? 
4. How can publishers bridge this data divide and be better equipped to get the full value of their impressions? 
5. Can we use OpenX Market with our non-OpenX ad server, or do we need to use OpenX ad serving technology? 
6. What’s future of programmatic trading, where will it go next? 

Q: What is programmatic buying, and does it apply to Real-Time Bidding RTB only?
A: First, let’s begin with defining programmatic trading, which to us includes both the buy side and the sell side. Programmatic trading provides an automated way for buyers and sellers to connect, eliminating the time-consuming, highly manual and error-prone insertion order process used by sales teams. Let’s face it, the I/O process relies too much on spreadsheets and fax machines and is extremely inefficient. So automation is the defining element of programmatic trading. Programmatic buying, then, is a highly efficient and automated way to connect with programmatic sellers by automating and improving discovery, negotiation and workflow.

RTB is one way of implementing programmatic trading, but it’s not the only one. RTB is simply a protocol that enables real-time discovery (in the sense that the buyer is made aware of a buying opportunity), negotiation (in the sense that buyers can submit bids for an auction), and workflow (in the sense that the creative to be delivered is part of the buyer’s bid response). That being said, there are other platforms, such as isocket and Adslot, which also connect buyers and sellers in an automated fashion.

Q: What does “first look” mean?
A: First-look essentially means the publisher gives a specific buyer the right of first refusal. In other words, a buyer can decide whether or not to purchase an individual impression before it’s offered to other any other buyers.

First-look resonates with buyers who are interested in obtaining exclusive inventory for their campaigns, and they’re willing to pay premium rates for the privilege. First-look allows them to ensure they get 100% share of voice for the particular impressions they value most.

There’s another notion known as exclusive first-look. With exclusive first-look, buyers have right of first refusal for 100% of the publisher’s inventory.

Q: Now that publishers are getting more sophisticated with yield management, how do you see Programmatic Premium working in concert with those new strategies?
A: This gets at the heart of what we believe here at OpenX. In our view, publishers lose money when they make selling decisions in silos, which is the way they’ve made their decisions historically.

Publishers cordon off a portion of their inventory for their direct sales teams to sell, which means all other demand channels are barred from getting access to this so-called guaranteed-inventory. However, at OpenX we believe that it’s in both the publisher’s and the buyer’s best interest to allow all demand channels to compete for inventory simultaneously.

Here’s why: let’s say a publisher sells a direct campaign to an advertiser at a $15 CPM. The ad server sends impressions to that campaign automatically. But what if an RTB buyer is willing to pay a $30 CPM for a particular impression? Should the publisher make an exception for those high bidders?

We think there are certain situations in which the publisher would be better off taking the $30 bid now with the full knowledge that they’ll be able to meet the commitment that they made to the direct-sold advertiser later.

When publishers bifurcate the demand between guaranteed and non-guaranteed, overall yield decreases, which is why we believe publishers should centralize all of their demand channels within one platform, allowing all demand to compete simultaneously for inventory.

The single platform environment allows publishers to increase their level of sophistication they apply to managing yield by identifying which buyer values its inventory the most on an impression-by-impression basis. And it ultimately benefits the buyers by ensuring they get broader access to the impressions they desire for their campaigns.

Q: How can publishers bridge this data divide and be better equipped to get the full value of their impressions?
A: This is a pretty important question. Buyers leverage first-party and third-party data they’ve gathered about users and publishers in order to inform their bidding decisions. As a result, they may bid $10 for a particular impression, $4 for the next impression and nothing for the third impression.

To the publisher, these buying decisions are a mystery, and that needs to change. Publishers need insight into historical bidding behavior of buyers so they can better understand who buys their impressions and under what conditions. Moreover, insight into buying behavior can serve as a lead-generation tool for publishers in that they’ll know which advertisers to pursue for direct relationships. Of course, this benefits buyers as well because it encourages premium publishers to make more of their inventory available to those buyers.

The second piece of this is how publishers can apply that information. Once publishers know who values each segment of their inventory, they can negotiate more custom deals with those buyers, such as first-look or custom price floors. The buy-side also benefits, because they have access to more of the impressions they value most.

Q: Can we use OpenX Market with our non-OpenX ad server, or do we need to use OpenX ad serving technology?
A: You can access OpenX Market, OpenX’s global ad exchange, using any ad server. Our goal is to help every publisher increase yield – regardless of their ad-serving environment.

That said, we do believe there are advantages to our end-to-end platform because we’ve seen the value of centralizing all of your demand in one place. Yield goes up, and inefficiencies go down.

Q: What’s the future of programmatic trading, where will it go next?
A: We’re just scratching the surface of programmatic trading, and believe that the vast majority of ad spend will ultimately be traded via automated means, rather than the highly manual I/O process that accounts for most ad spend today.

Programmatic trading unlocks demand, which is a good thing for publishers seeking to increase yield, which is why we see a future in which most media is traded programmatically.

Now that doesn’t mean your sales force goes away. Sales teams are very important for crafting relationships with buyers, and working with buyers to identify packages that are most attractive to buyers. But, ultimately, the execution of that needs to be more automated. It’s hard to argue against the value and efficiency of automated workflows, automated discovery, and automated negotiation.

Revenue Intelligence, which we introduced last week at our Napa customer retreat, is a groundbreaking, holistic approach to revenue management that solves this problem by combining content optimization and ad monetization for the first time in the industry. This new service provides publishers with a precise understanding of the actual value of their content, their audience and their ad space. Through the JumpTime acquisition, OpenX gained patented technology including specialized algorithms that measure the total value a page generates based on a net present value calculation of all engagement on a website by analyzing traffic and ad revenue in real-time. By improving content valuation beyond simply counting page views or clicks, and by increasing their understanding of their traffic flow and audiences, publishers using Revenue Intelligence are able to achieve significantly greater revenue by guiding audiences to the most valuable content throughout their websites. And, in fact, early users of Revenue Intelligence – including major newspaper chains and national magazines – have experienced revenue lifts of 30% to 90% depending on the specific implementation.

What makes Revenue Intelligence unique – and so helpful – to publishers is that it not only helps them value engagement with their content, but does so within the context of how they monetize that content. We do this in part by blending OpenX’s massive ad monetization and content optimization pools of Big Data to provide a potent approach to revenue maximization. In addition, Revenue Intelligence analysis is further enhanced by insights provided by OpenX Revenue Intelligence experts.

We think this fundamentally new approach to helping publishers maximize their revenue is important for the industry and we’re excited that the launch of Revenue Intelligence has been met with such enthusiasm.

To learn more about Revenue Intelligence, follow us throughout this week on our blog and on Twitter: #RevIntel. Also check out our Revenue Intelligence infographic for how this approach bridges the gap between advertising and content just below. And, for more information, please check out our launch press release and the great initial coverage on TechCrunch.

Historically, “premium” was considered highly valued ad space that was only sold directly by the publisher through traditional means. Meanwhile, new technologies like Real-Time Bidding (RTB) were developing that enticed publishers and advertisers with an opportunity to buy and sell premium ad space in a more efficient and effective way.

Although publishers have traditionally been reluctant to place their premium inventory into exchanges, the old assumptions surrounding automated trading are no longer valid and this reluctance is fading. The digital advertising space has fundamentally changed with programmatic trading cementing its role and an increasing appetite for programmatic trading of premium inventory. For both advertisers and publishers, this phenomenon can no longer be ignored.

In fact, our new research confirmed what we had suspected about programmatic trading at-large: more than 70% of the respondents surveyed are currently trading programmatically and predict double-digit revenue growth this coming year. And many publishers believe programmatic trading provides solutions to the common inefficiencies found in the traditional direct sales process, including: replacing the insertion order workflow, billing and reconciliation, optimization and trafficking.

As I’ve said before, “premium” is in the eye of the beholder, but publishers and buyers are eager to take real control of it programmatically. So, as the industry shifts, it’s necessary for digital media companies to provide fully integrated programmatic trading platforms that can service the entirety of a publisher’s inventory. In our survey, publishers indicated that they are looking for an ad technology solution that provides comprehensive yield optimization, granular controls, and reporting insights. Approximately 70 percent of publishers that currently don’t use an ad server with integrated exchange capabilities are likely or highly likely to convert to one in the coming year. OpenX’s unified monetization platform is an example of such a platform: OpenX manages all sources of a publisher’s demand and maximizes yield, giving appropriate access to inventory to each demand channel.

For publishers interested in learning more, please join our Programmatic Premium webinar: Wednesday, April 17, 2013 at 11:00 AM (Pacific) or download the white paper here.

Programmatic Premium is still a new concept in the space and the variety of definitions for it that we received from the survey made clear that further education on the concept is necessary as it continues to evolve. Additionally, the majority of respondents believed that buyers are benefited more by Programmatic Premium primarily because, as one respondent observed, “[the]sell side still doesn’t have the insight, controls and automation to really optimize yield and manage an integrated direct/indirect strategy.”

We agree. To maximize digital ad revenue, publishers must have access to the data and tools that can help them better understand the value of their ad inventory in order to increase yield. At OpenX, our approach is to provide one unified platform to manage all sources of a publisher’s demand – directly sold inventory, RTB and ad networks – enabling all demand channels to compete simultaneously for each impression, thereby maximizing yield for the publisher and giving appropriate access to inventory to each demand channel. OpenX partners are subsequently well-positioned to dramatically increase their revenue.

OpenX believes that Programmatic Premium is simple:  preserving the direct relationships between buyers and sellers but facilitated through programmatic (automated) means. ‘Premium’ is in the eye of the beholder. But to make the most of it, you need to take control of it.

At OpenX, we have a singular focus behind our work: to maximize ad revenue for digital media companies on any connected screen. Since 2008 we’ve been building the most comprehensive monetization platform to make this a reality for publishers. We’ve executed on a big vision: to enable digital media companies to maximize all their ad revenue sources – exclusive, guaranteed, programmatic and ad network – in one place, because we understand a diversity of revenue sources is our customers’ reality.

Last year, we more than doubled the company’s headcount, building out the team with even more exceptionally talented folks. To accommodate everyone, we opened four new office spaces – London, New York, Tokyo and our new 45,000 square feet Los Angeles headquarters. We acquired two great start-ups – JumpTime and LiftDNA - to further accelerate our vision of helping digital media companies unleash their full economic potential. We also opened our fifth global datacenter in Chicago, stacked with the second-generation of our proprietary servers, enabling us to increase the volume of ad transactions we process by 300%, from one trillion to four trillion. Fueling all this was our customer growth in 2012, adding new customers across all sectors of OpenX’s businesses.

But our work is far from done and there is still a huge amount of innovation to come. In 2013, we’re deepening the platform to more natively support all screens, especially smartphone and tablet. (If you’re attending the Mobile World Congress this week, be sure to see Mike Downey, VP Mobile Solutions, in a panel discussion on Thursday with Samsung and Nokia with the Application Developers Alliance). We’re also extending the platform to shape the next generation of RTB: programmatic premium. And now with our JumpTime content optimization platform we have expanded beyond ad yield maximization and now offer the ability to help publishers improve the economics of their audience’s content experiences as well the yield of the ads they see. We believe the patented data algorithms that power the JumpTime engine and the broader fusion of all these technologies provide our customers with unique advantages as they work to increase their revenue.

In short, the OpenX monetization platform is now uniquely positioned to help a digital publisher tackle their overall revenue strategy by optimizing the interplay of price (ad yield) and quantity (audience & content optimization).

To help us continue to execute this strategy, we recently closed a strategic round, which was led by new investor Samsung Venture Investment Corporation and included new investor Dentsu/cci. Both new investors speak to key strands of our strategy: a deep focus on mobile and our growing strength in Asia. Both also highlight our ability to build strong partnerships with major global corporations: in each case we started the relationship with a commercial partnership.

To have both the world’s largest mobile device and electronics manufacturer and the world’s largest (by revenue) agency group invest in OpenX is a great honor for us. They join our existing world-class investors, global enterprise software leaders SAP Ventures and our top tier VCs like Accel and Index. We aim to step up with sustained innovation to provide the best and most comprehensive monetization platform for digital media companies.

Last but not least, our work is gaining an increasing amount of recognition. Every year Forbes runs an exhaustive process to identify the top 100 most promising companies in America across all sectors. That list was released a couple of weeks ago – and we are delighted to have been recognized, breaking the Top 10 at #7.

We’re looking forward to an exciting 2013 as we accelerate our push to help digital media companies grow.

These are the tough questions that OpenX will be tackling at Digiday’s Publishing Summit this March, as we attempt to define what ‘programmatic premium’ means for the publishing industry at large. But we need your help.

In order to create as comprehensive a review as possible, we are asking the publishing industry for their opinions and thoughts as to how ‘programmatic premium’ is defined, and who is successfully applying it to their own publishing business. Our quick survey takes just a couple of minutes to complete. To say thank you, you’ll receive:

* Full, unfiltered results of our survey when published.
* An opportunity to be considered for a VIP invitation to DPS in Scottsdale, AZ, and
* A chance to win one of two $500 American Express gift cards, courtesy of OpenX.

The survey is targeted specifically to industry insiders, so please share with your industry colleagues. Take the survey here.

To start with, the efficiency that is inherent in RTB-based buying means that buyers are able to value each impression differently by leveraging all the available attributes, essentially being able to ‘cherry pick’ only those impressions valuable to them. Add to this the sophisticated targeting data and measurement capabilities that RTB affords, actionable through the use of desktop cookie data, and you have the all the capabilities to action incredibly accurate and targeted online ad campaigns. For the sell-side too, RTB helps sellers of inventory price more accurately and execute more efficient ways of selling to scale.

At OpenX we have experienced the power of Real-Time Bidding (RTB) first hand. Our RTB-enabled exchange platform OpenX Market currently serves in excess of 140 Billion impressions per month. Over the past few years we have been helping buyers and sellers of online inventory scale their campaigns in efficient and highly accurate ways. Yet even with the accelerating pace that we’re seeing in OpenX Market, mobile advertising has failed to reach its potential in exchange-based buying environments. The reason? The lack of cookie data available in connection to mobile inventory. While there has been a great deal of excitement around mobile – and particularly mobile RTB – the absence of an effective and privacy-compliant approach to audience recognition has hampered adoption.

OpenX and AdTruth have today announced a partnership that will seek to help provide a path forward for programmatic buying in the mobile world that provides the results marketers need and the privacy protection consumers demand. From the second quarter of 2013, mobile (smartphone and tablet) inventory within OpenX Market will be able to be bought and sold with the use of AdTruth’s DeviceInsight ID. AdTruth’s patented device recognition technology anonymously identifies consumers whether they are using their device for apps or to browse the mobile Web. Essentially, AdTruth will fill the gap where cookies do not perform, ultimately resulting in increased ROI for the marketer.

I’ll be discussing this in more detail at today’s Mobile Marketing Alliance event in San Francisco, together with James Lamberti from AdTruth. Be sure to connect with me there, and take a look at my presentation slides below.