Introduction and Mark McEachran's career in ad tech

Alex Gluz: Hey, Mark, nice to have you here. Can you do a brief intro of who you are and what you do?

Mark McEachran: Nice to be here, Alex. I am the senior vice president at Yieldmo. I’m a product manager. I oversee the platform and, more specifically, the ad exchange.

Alex Gluz: How did you get started? What did you go to school for?

Mark McEachran: I went to school for computer science, way back. I met a future colleague there named Frank Addante, and he hired me on in 1997 to work at a little company called Starting Point. That website was stpt.com, and at the time it was the third most trafficked website on the internet, behind something like Microsoft and maybe Yahoo. It was literally run out of a closet inside a boutique creative agency in downtown Chicago. I worked on the little ad server, sitting there with Frank day in and day out. That really planted the seeds of my career in advertising and specifically in product management, because I knew I didn’t want to be writing code for the entirety of my career.

Alex Gluz: What was the website about? Was it a search website?

Mark McEachran: It was a search website, manually curated. You’d submit URLs to it, and then the system would try to index those. Then you would sell banner ads on top. It wasn’t the keyword driven Google search marketplace that we have today. It was very primitive.

Alex Gluz: You’ve pretty much been close to 30 years. How long have you been at Yieldmo?

Mark McEachran: A little more than two and a half years. I was brought on to manage the exchange. I built my career on ad tech and advertising exchanges. This is reminiscent of some of my early days at Rubicon Project, where we built the first supply side platform exchange.

How ad exchanges connect publishers and advertisers

Alex Gluz: Can you break down how an ad exchange like Yieldmo facilitates transactions between publishers and advertisers?

Mark McEachran: Yieldmo operates as a marketplace between sellers, the publishers and media owners, and the buyers. If you imagine 1,000 publishers out there and 1,000 advertisers that want to advertise on them, putting both groups together directly would be a million distinct contracts. So you have SSPs, like Yieldmo, and DSPs, like The Trade Desk or DV360. The SSPs manage the publisher contracts, the DSPs manage the advertiser contracts, and then you have a manageable number of contracts between SSPs and DSPs, because maybe there are 30 or 60 on each side.

That business relationship is really just a reflection of the technology relationship. Publishers have a website, or CTV or mobile app properties, and they send ad requests to their supply side platforms. Those platforms validate the request and distribute it to 10 to 30 DSPs. Each DSP filters through the ad campaigns, picks the right one for that request, that user, that device, that media type, and sends in a bid. The SSPs run an auction and return a bid to the publisher. The publisher runs a second auction to choose the winning ad, and that ad gets served. It became a big business starting back in 2009, when things really took off with the real time bidding protocol.

What cookies do and why cross site tracking raises concerns

Alex Gluz: Let’s talk about cookies. Maybe you can explain as simply as possible what a cookie is and what’s going on right now.

Mark McEachran: The cookie was invented in 1994, very early days of the web browser. The purpose was to maintain state between the browser and the web server the user was interacting with. It was really built for a shopping cart. If you didn’t have that cookie, all that information would have to be stored in the browser’s query string, and that gets unmanageable quickly.

But advertising took that cookie. Its capability allowed servers to maintain state with a user’s browser as they travelled across the web, so long as the server had some asset on each of those pages. That created a place where you could serve ads to that user across several websites and still make sure you didn’t serve them too many. That evolved again into cross site tracking, which is the crux of the argument today. Ad tech companies could understand which pages a user went to and start building a user profile, then create more targeted advertising.

In its purest form that use case is still something most people think is okay. But it can get a little nefarious. You build those profiles, you have that cross site tracking, and then a government agency can come in and start buying data from ad tech companies, building user profiles for more nefarious purposes. They’re saying, “This is a political activist, and I’m running a dictatorship, so I’m going to stamp down on that.” And if you can link a profile to an individual, get their name, address, phone number, now you have this bridging of personal information and user behavior. That goes beyond the scope of what advertising should be doing.

Alex Gluz: At this point, is the cookie really an advertising thing, or does it also affect other things?

Mark McEachran: Absolutely it affects other things. Financial institutions with different domains have used the cookie’s cross site ability to keep someone logged in across different divisions of a bank. There are lots of use cases outside advertising. And let’s be clear, we’re not talking about Google disabling all cookie activity, just the ability for a single entity to track a user across different sites. It’s a reasonable goal. It really is. But it’s a real challenge, because the cookie is wide open and there are probably more uses than we can enumerate.

Contextual targeting and advertising performance

Alex Gluz: Contextual targeting is gaining renewed interest in the post cookie world. How does Yieldmo’s technology enable advertisers to reach the right audiences based on context?

Mark McEachran: Contextual is really just a proxy for audience. Advertisers buying contextual aren’t so much interested in what’s going on the page, but more who is consuming that content. If you’re looking for car buyers, you can target automotive websites, apps and streaming shows.

At Yieldmo we have two definitions for context. The first is what most people think of: the topical content of the media, the sentiment, the keywords. The second is what’s going on with the user interacting with that page and that ad placement. What device are they on? Is the mouse hovering over the ad? How long is the ad showing? What’s the tilt of the device? You can take that as situational or behavioral context and tie it to that part of that page.

Put them together and you can really focus on an advertiser’s KPI. Do you want ad units that are in view a lot? High attention ads that people are mousing over? Something more clicky? Something that renders above the fold? Something with a high video completion rate? Everybody wins. The more performance you deliver for the advertiser, the more they’re willing to pay the publisher, and the user gets a richer experience with more relevant advertising.

First party data, email addresses and alternative identifiers

Alex Gluz: With cookies out of the picture, first party data feels like the MVP. What advice would you give companies looking to up their game in collecting and using it?

Mark McEachran: There are two players in the first party data game. There are publishers, and there are advertisers. Advertisers have been playing a successful game in that area for a long time. They have a long history and a lot of industry tools and vendors to choose from.

For the sellers, the publishers and streaming media companies, it’s becoming more and more important to identify their user base. What they have to offer is the media, and they need to compensate users for that identity. It used to be just newsletters. But now, with the post cookie world approaching, having that email address or phone number becomes a new currency, almost replacing the cookie. You have a deterministic identifier based on a hashed email address that you can pass to the bidstream.

It’s a bit of an unfortunate situation. You used to read the article and get a cookie tagged to your browser, and you had freedom to read that article semi anonymously, because the cookie didn’t contain your personal information. You got targeted ads as a result, and that was the value exchange. But now publishers are asking for your email address before you can read the rest. That email address becomes the token that goes to the bidstream and now becomes the identifier instead of the cookie’s ID.

My advice to publishers would be, right now, just do your best to collect it, because your business might depend on it. As an internet citizen I wish that weren’t the case. But if you’re a clever publisher you’re always looking to do more with data, and there are a growing number of vendors helping publishers not only monetize their user base better but improve the user experience with personalization.

Alex Gluz: So pretty much wherever we go, we would need to log in and use the email.

Mark McEachran: The irony is that these efforts are being driven to improve privacy. But then the countermeasures, in order for publishers to continue to make money, are to kind of reduce privacy. Now you’re giving your email address, which is more easily tied to personal information with offline databases.

Alex Gluz: Is it better for advertisers to have an email or to still have a cookie, as far as efficiency and profitability?

Mark McEachran: There are a handful of companies collectively called alternative identifier companies, folks like ID5 or LiveIntent. These can give you cookie like identifiers on your user base. Sometimes they’re tied to an email address and sometimes they’re not, using what we call probabilistic matching across different publisher sets.

By and large the deterministic identifiers have a more robust signal because they’re tied to an email address. However, collecting an email address from every user who visits your site is very challenging. A publisher probably wouldn’t want to put all their eggs in that one basket. They want what the industry calls the portfolio approach. Figure out where the gaps are and how you want to fill them. Sometimes that’s probabilistic identifiers, but it could also be a more robust contextual offering.

Anonymous email addresses and the risks of personal profiling

Alex Gluz: Back in the day people created emails with some weird name. Now the address is often just your name. Are we going in the opposite direction, where people use some sort of anonymous email?

Mark McEachran: That is a thing. Apple has their email anonymizer. When a publisher asks for an email address you can tap a button on your phone and it puts in a fake address that forwards to your real one. If you ever want to break that connection it’s a click of a button. This is not great for advertisers. It doesn’t function well for deterministic identifiers, because effectively that email is only used once. It diminishes cross site targeting because it’s unique everywhere you go. You can’t even frequency cap against it, except on that one publisher.

Alex Gluz: People were broadly fine with being shown an ad for a cat if they like cats. But if you know someone’s political affiliation, or anything more personal, that becomes an issue.

Mark McEachran: Cambridge Analytica, that scandal with Facebook, really was eye opening for the industry. Being able to collect and understand a person’s political leanings, or even that they were on the fence or in a fringe group and could rally other people to take action, really got folks thinking. There’s the data collection, and then there’s the analysis of it, and a remarkable amount of insight can now be gained out of machine learning.

Preparing B2B marketing for changes in identity and targeting

Alex Gluz: We specialize in B2B. What’s your take on B2B marketing, to understand this and plan ahead?

Mark McEachran: Understand that there’s no one solution that’s going to fix everything or handle all of your use cases. We like to use the word fix, as though something is broken, but it is just expanding on the opportunity and taking advantage of the tools at hand.

One thing: look for things that are ID independent, that work with or without IDs. Those are going to be more future proofed. Then find media that works for your target audience. It might be on LinkedIn. Your user cohort might bop around Business Insider or Forbes. Do the research. Find the audience.

The big piece of advice is test. Test your market tactics, and once you’re done, start over and do it again. Your audience moves, the media changes, their preferences change. You might be interested in a new cohort. You can’t count on them repeating the same patterns. Let the data guide you and test. Always have a little bit of budget set aside to test and find new areas that are working. Make sure that flywheel is going, and don’t let it stop.

Advertising budgets, connected television and the open web

Alex Gluz: What is your prediction for the next few years?

Mark McEachran: To some extent, the die has been cast. Markets, buyers of any type, shy away from uncertainty. We draw a lot of parallels between programmatic advertising and the stock market. Right now, the open web is sitting in a place of massive uncertainty. This was triggered by Google’s signal to deprecate cookies years ago. That started the ball rolling. You’ve seen dollars move from the open web to social media, walled gardens and connected television.

Whether or not the technical mechanics of cookies go away, I don’t know that it changes those dollars moving to more certain areas at this point. Marketers are going to work to discover the certainty of connected television as more media is brought on with advertising enabled, and the walled gardens are going to continue to grow. Facebook has got it dialled in. YouTube is also very good at what it does, and the dollars are reliable.

So I think the open web is going to struggle. You also have the walling up of individual publishers asking for email addresses, which makes the web less anonymous and creates friction for the user. With dollars shifting out of the open web you’re probably going to see some decline in media quality, because media owners will say, “I’m going to put my efforts in CTV land, because that’s where the dollars are becoming more reliable.” You’ve already seen companies like Vice Media pull out of their own website properties in favour of contract distribution. There’s probably going to be consolidation, and some of the smaller players will die off.

Opportunities for privacy focused businesses

Alex Gluz: Do you feel there will be more companies and startups focusing on privacy as we move along?

Mark McEachran: Perhaps. I think a lot of privacy focused companies have a lot of opportunity now, especially with legislation. Being privacy compliant, especially in the United States, is a real challenge. There are new laws coming from states every few months. Oregon and Nevada recently lit up. Washington has a new medical privacy law. You have to really pay attention.

Because of that, complexity becomes a barrier to entry on the business side. But on the privacy side there’s opportunity for someone to come in. Consent management platforms are probably well positioned to manage the complexity of these laws. If you can take complexity and simplify it, that’s a valid business in any arena.

Mentors, personal advice and closing remarks

Alex Gluz: Who were your mentors, and the best advice they gave you?

Mark McEachran: I have three that come to mind. One guy, Craig Roah. I’ve worked with him since 1999. Level headed in the face of adversity, a guy who can buckle down and get the job done. He also helped kick start one of my businesses after the bubble burst. Quite simply, his advice was, “Get it done.”

My second mentor would be my wife, Sina. She taught me self exploration, among a myriad of other things. Her advice, in summary, would be, “Know your why.” Knowing yourself helps you understand your reactions to situations and gives you clarity to see the best way through them.

Finally, my father, who always involved himself with his family whenever he could. His advice is probably too extensive to enumerate, but I can attempt to summarize it with, “Lead with your heart.”

Alex Gluz: Where can people learn more about you?

Mark McEachran: You can go to markmceachran.com. I maintain a blog there. I write a lot about ad tech and a little about travelling.

Alex Gluz: We’ve been talking to Mark McEachran, senior vice president of product management at Yieldmo. Mark, thanks so much.

Mark McEachran: Thank you, Alex.