Scott Switzer is the co-founder of open source ad serving company OpenAds. Launched several years ago as the tech arm of Unanimis, it has long been billed as a threat to online ad networks by giving publishers more power to pick the ads they display. Twenty five thousand of them are now using the site.
Here, Scott talks about OpenAds’ upcoming move into new formats, as well as its recent funding by a group of well-known VCs.
What will the funding round mean for the publishers and ad networks that use your platform?
We’re now really focused on building the best product possible. There are a lot of features that people in the community have been requesting for years, and we are in the process of implementing them.
From a commercial standpoint, we’re starting by offering support and consultancy as a service, and going forward we will be working with ad networks that want to reach publishers, since they couldn’t in the past. We can ask publishers if they would like to participate for ad networks’ programmes.
Writing on his blog at the time of the funding,
First Round Capital’s
Josh Kopelman said OpenAds was in a position to shrink the ad serving market. What does he mean?
Talking on an abstract level, there’s going to be more and more efficiency in the marketplace. By the end of this year, if you’re paying for ad serving you shouldn’t be.
On the ad network side, the goal of an advertiser is to reach users but there are a lot of people in the middle taking out margin. What is going to happen is the amount of revenue that publishers see will rise. With tools to compare advertisers and ad networks, publishers will be able to make smarter decisions and create more margin.
That doesn’t mean ad networks will go away – they can still create value by introducing their advertisers. The people that will suffer will be the arbitrage specialists. The top ten networks have really strong, direct advertiser and agency relationships, while the others buy from one network and sell to another.
Where we are really focusing our energies is to provide publishers with tools that they need to evaluate agencies, advertisers and ad networks. We want to integrate ourselves with all of these players. It’s our intention to be the ad platform that all publishers use.
Can you give some examples of the other features you are planning to add to the platform?
One of the features we have added is a way of integrating with Google AdSense, so you can see the performance of a Google AdSense campaign within OpenAds.
Our publishers generally want the biggest cheque possible at the end of the month and they are willing to rotate ad networks like AdSense, Tribalfusion or Advertising.com to see which makes them the most. The trouble is that going into Google, Tribalfusion or Advertising.com individually and trying to compare effective CPMs and how many ads they have served is very time consuming, so we are working those into a single platform.
Another example is we are building out more sophisticated delivery algorithms so you can do smarter yield management, things like that.
What expectations and plans do you have for online video ads and other new forms of internet advertising?
I think that video will be seen as the growth sector in online advertising in the next year or two.
There’s a lot of video on the net that hasn’t been monetised yet. I’ve seen a few technologies recently that are attempting to do that – there’s a company called Castfire in the US that automatically inserts ads into a video stream, and that kind of thing will really help.
We’re starting to work with some people on the video side of things. OpenAds has a plug-in system for different ad formats so today, if you know what HTML to spit out then OpenAds can be used for video. But we want to obviously make it as simple as any other type of ad serving.
The other thing is widgets, and the ability to be a lot smarter about what advertising really is. You can put shopping carts on sites now, and that’s a form of advertising that people use OpenAds for. One company serves 3m widgets a day using OpenAds.
What are your expectations for uptake by publishers of new formats?
Going forward, banner and search advertising are not going to go away, but there will not just be two types of advertising. There will be a lot of ways to make money from your website.
Up till now, publishers have really been screwed. Not only have they only had access to AdSense or a few display networks, they have also not had any leverage to set the price for their inventory. A lot of the programmes they have access to are performance based, whereas a few years ago it was all CPM based.
What publishers are really looking for is a number of options they can choose from to optimise their sites. Some companies have told me they would rather have users produce the ads on their sites. Going forward, there is going to a lot more of an integrated experience where publishers can choose the types of advertising they display.
How does your publishing base break down geographically, and what plans have you for the UK?
On the geographical side, we are in more than 140 countries around the world. The number one country is the US with 30%. All of Europe adds up to 35% to 40%. There is a very dispersed community.
We have a medium-sized publisher base in the UK – despite being our backyard, it’s country number nine for us, so not as widely adopted as the Netherlands or Sweden. For the last three years or so, we have been focusing on working with Unanimis and haven’t been focused on acquiring other publishers.
Also see our Ad Serving Buyers’ Guide for more information on OpenAds and the ad serving sector in the UK.