MarTech Interview with Doug Huntington, CEO at FatTail

Doug Huntington, CEO at FatTail chats about the evolution of SSPs and the changing media planning game in this quick-chat:

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Welcome to this MarTech Series chat, Doug. Take us through your time in B2B tech and tell us more about your role at FatTail.

We at FatTail have been involved in digital advertising technology since 2001, before there was any real tech in the space. Back then, publishers were just starting to figure out if digital advertising was a new trend or if it would have legs — not to mention if it would adversely impact their longstanding print and broadcast business models.

My co-founders and I were fresh out of building software companies in the financial trading space and thought some of the lessons from that landscape might be applicable to digital advertising as well.

It turned out we were way ahead of what publishers really wanted, which in the beginning was just the most basic solutions to the most fundamental problems. In most cases, the focus was getting deal logs off of spreadsheets so they could be centrally managed.

Beating backed walled gardens, privacy concerns, inventory commoditization, carbon footprints, cookie deprecation — all of these would have been beyond publishers’ wildest imaginations back then. A lot has changed.

Today I’m focused on scaling the company while providing the first marketplace for automated direct deals. We believe this is crucial to the future of publishing, which cannot rest on the open programmatic market. We understand that there have been efforts in the past to do this — but never from the position of the publisher system of record for inventory management.

Our twenty years of experience in the OMS business positions us to help publishers navigate the shift to automated direct.

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We’d love to hear more on FatTail latest enhancements and how it can impact end users.

Our investment thesis is that direct deals really do matter, particularly for delivering more value to premium publishers and brand advertisers. Beyond that, we believe the status quo of manual direct advertising is too onerous to execute and doesn’t scale well.

Taking stock of these conditions, it became clear to us that the industry needed an easy button for automated direct. So, we built a marketplace purposely designed to automate direct deals between any supply and demand partners, while still ensuring buyers and sellers maintain full control of their transactions.

How are you seeing the evolution of SSPs change the digital ad game in today’s market?

SSPs could choose to get better at supporting direct deals, and given the industry’s trends, they probably should make that move. The open market is pegged at just 20% of overall ad spend, while programmatic guaranteed volume is rapidly growing. This highlights the hunger for more convenient direct deal types.

For premium publishers, the opportunities of automating direct deals are even more pronounced. Our clients receive less than 5% of total ad revenue from open market transactions, and they take in more than 85% of revenue from “traditional” direct deals. Given this dependence on manual deals, our clients are very interested in automating direct deals to increase efficiency and transaction volume.

Looking at the entire industry, DSPs and even media planning systems could also choose to bypass traditional SSPs entirely and connect directly with publishers’ inventory systems to power a new level of deal directness.

Our marketplace is designed to support either case — programmatic or direct — and the infrastructure is open to any supply or demand partner.

What are some thoughts you have on the future of the adtech segment and impact of AI within it?

AI has the potential to play an important role in deal automation, which is always one of our areas of focus. AI technology could reinvent media planning as well, especially when it comes to optimizing creative formats and ad slots.

AI also has a lot of potential to help connect disparate workflow processes that may be lacking standardization. AI can bridge that gap, bringing buyers and sellers onto the same page with common language.

A few common adtech misconceptions you’d like to dispel before we wrap up?

Advertising should not be about the tech. The tech should drive trust between publishers, advertisers and consumers — not get in the way of it.

The idea of disintermediating the natural state of the publisher-advertiser-consumer relationship to take a 50% fee is unfair. It is also harmful to the long-term preservation and advancement of professional journalism and other forms of premium content.

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