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The SpotXchange's Denver team
The mid-term elections are tomorrow and candidates, political parties and PACs (political action committee) are doing everything they can to sway voters. But beyond showing up at your front door or getting people on their increasingly rare home phone lines, candidates have trouble with specialized targeting. With an influx of cash, especially from PACs, there’s more money than advertising spots.
“There’s not enough inventory from television to satisfy the number of dollars that have flowed into this category,” said SpotXchange’s VP of demand platform Kevin Gianatiempo.
That’s what makes the new partnership between Denver-based SpotXchange and Audience Partners so interesting; the two are able to target internet users based on things like political affiliation and voting habits and offer politicians a chance to advertise to them directly.
500 Milliseconds
SpotXchange is an online market for pre-roll advertisements – the kinds shown before a YouTube video plays. SpotXchange matches supply (think online publishers) with demand (anyone selling something). When a user goes to a website and clicks on a video, third party vendors send out information about that user – what websites she’s been looking at recently, where she’s located, her age group, among other things – and advertisers can bid on buying that video space. SpotXchange then grabs the winning ad and delivers it to the user.
That whole process takes just 500 milliseconds, according to Gianatiempo. This is why you’re likely to see a car advertisement on YouTube after checking out Kelly bluebook or searching for car reviews.
Political Ads Go Digital
For politicians, knowing whether a user looks at certain websites gives them clues to their behavior, but Audience Partners is able to give them one better. The company’s software matches publically available information – voter registration, party affiliation and political contributions – to certain locations, bundles it with other tracking data and strips out identifying information. That information is now available to political advertisers, who can better target their advertising budgets to likely supporters.
The data collected by Audience Partners and other third party vendors gives political advertisers over 7,000 variations or audience segments to go after. Gianatiempo says that’s the “secret sauce” allowing “voter registration targeting” to work on a large-scale. In the lead up to the mid-term election, SpotXchange had 190 campaigns running across the country.
While it may be a new market, “this was built specifically to address the demand from the political vertical,” said Gianatiempo. According to him, there was more money on ad spots than spaces on television or radio, especially towards the end of an election. That money was bound to find a place to land. Political video advertising has increased 700 percent since 2008, according to SpotXchange.
Finding Growth
The company isn’t just growing through political channels alone. The company sold a 65 percent stake to European based RTL back in July, opening up more European market opportunities. They are also driving business toward mobile videos. When the company started back in 2007, the entire focus was on desktop devices. Now, the company has 2 billion monthly pre-roll videos, compared to 3 billion on desktop devices. Gianatiempo says that connected TV – the Netflix model and what HBO is now offering – is an interesting and growing area the company is exploring.
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The company is expanding, with open positions across “every department” in their Denver office and other opportunities in the US and Europe. Gianatiempo says one of the best parts of the company is its dot com culture and laid-back atmosphere.
