Los Angeles-based Spot Runner, which for the past year has been privately previewing a Web-based system for buying and selling ads, has officially unveiled the system, the Malibu Media Platform.
Spot Runner says that Malibu, which it describes as a “technology platform,” makes the media buying process more efficient for advertisers and should let programmers sell their inventory to a bigger pool of advertisers. The company’s goal is to automate and digitize much of what is still a paper- and phone-call-intensive transaction process by integrating with existing systems to produce a Web-based dashboard that gives a comprehensive view of an advertising campaign.
“Today, it’s a true mess, a cacophony of different means,” says Spot Runner VP of technology Marco DeMello, a Microsoft veteran who has designed much of the Malibu system.
While it doesn’t replace existing advertising technology such as sales software or traffic and billing systems, Malibu is designed to provide end-to-end support for all aspects of the buying and selling process, including controlling inventory and pricing; creating campaigns and orders; submitting and clearing creative; generating and confirming traffic instructions; delivering on-demand campaign reports; and managing credit and pricing.
The system is based on the premise that programmers and other advertising sellers will preserve control over inventory, pricing and buyer relationships while buyers preserve their buying power on behalf of their clients. As such, it uses sophisticated algorithms to match buyers and sellers at a price they both find acceptable.
“It’s not an auction, but a double-blind allocation engine,” says DeMello, who adds that Malibu borrows from algorithms used to help value perishable goods and wireless spectrum.
Spot Runner has tweaked the system over the past year to meet the requirements of prospective customers, says president John Gentry, with the core goal of simplifying what has become an incredibly complex process in the digital age. Gentry notes in 1980 there were only 11 national networks and 18 million national and local TV spots, while today there over 125 national networks and over 12 billion TV spots. The base of national TV advertisers has also grown exponentially, going from roughly 600 in 1980 to over 3,000 today.
There has been a similar increase in the amount of measurement data, including set-top data from millions of pay-TV households, though making sense of it has somewhat eluded the industry. Malibu will aim to simplify analytics by interfacing with various providers of set-top data, such as Nielsen, TNS and Rentrak, to provide aggregate reporting.
“Most people have a whole bunch of data,” says Gentry. “What they need is management of that data.”