A few weeks after its IPO and even fewer weeks after announcing that it was switching to an all-in-stream, all the time model, Tremor Video is set to announce today that it will launch its own DSP, called VideoHub Connect, a bidding and buying feature that will incorporate proprietary ad technology much like that seen at programmatic buying platforms like Rocket Fuel, which made headlines last week by knocking the ceiling out of its initial IPO prices (the stock was priced at $29 and broke $62 on its first day of trading).
The technology, said Tremor CEO Bill Day, is important. "We want to make a distinction between real-time bidding and programmatic," Day told Adweek. "Buying inventory cheaply at scale is not a recipe for success," the exec said in a press release sent to reporters today, and while that's certainly true, it's a sea change in the thinking both at Tremor and across the Web. "Most people see programmatic as a race to the bottom—how do I pay less? how do I pay less? You want to decide whether you want a luxury car or an economy car before you can decide on the kind of price you want."
The new tools on VideoHub will allow buyers to define their proposed outlay, the goal for their campaign, and a few other variables, but the point is to decrease, not increase, the level of tinkering a buyer needs to do to optimize a campaign. "Our goal isn't to create another layer, it's to create a better layer," said Day.
The new services are a serious bid to get television money into the Web video game—part of the reason Web inventory has been so cheap by comparison is that it's quite difficult to buy. There are hundreds, not a few dozen, desirable publishers to choose from, and millions of hours of content between them with demographic choices as multifarious as the programs themselves.
"Premium programmatic—it comes up again and again," Day said with a laugh. "It takes two of the biggest buzzwords and combines them into a single uber-buzzword." But that's what Tremor hopes to capitalize on. It remains to be seen exactly how premium the inventory is—inventory on exchanges has historically been characterized in less than flattering terms ("remnant;" "leftover"). But Day says there's a value proposition here for the publishers, too. "The rationale for any publisher to work with DSP or a network is that they're getting something they can't get on their own," he said—access to the parts of Tremor's client base, that won't show up unless they can buy across multiple publishers in a TV-like way, presumably. "And we have too strong a history of working with these publishers exclusively."
Along with YuMe, Tremor had a rough start to its IPO, but (if the quality of the ad tech is as good as its competitors') this move could greatly improve its fortunes on the stock market. Andrew Pancer, COO of Dstillery (an ad targeting/data firm) said the success of the Rocket Fuel IPO was a good indicator of where the market is headed. "I think [that] is a total validation of move toward programmatic buying. It shows that the investment in ad tech and particularly data targeting is starting to pay off," he said. "Unlike recent IPOs…I wouldn't really consider Tremor and Yume ad tech companies"
Tremor is hoping to change that perception today. "The future of video is going to be driven by television—[by the moment when the agencies] take their TV budgets and start to merge them from a planning and buying standpoint with online video." So Tremor is trying to make sure agencies are able to clearly see the effect of their buys—in terms of reach, "brand lift," to use Day's term, and other non-smoke, non-mirrors metrics. "The whole point of programmatic is to make digital easier."