1. FTI Journal • 1FTI Journal • 1
Death of the Travelling Salesman?
A decade ago, selling digital advertising was an anachronistic affair. A salesperson would enter a room and tout a network of websites,
often highlighting certain publishers and their presumed audience. The parties would negotiate a custom insertion order and
then pass it on to ad ops for trafficking. Despite the Internet’s established self-serve efficiency, ad sales remained high-touch and
Fast forward to today and witness how much digital ad sales have changed.
“Programmatic” ads — whereby automated platforms match ad buyers with
ad sellers in real-time — currently serve over 70% of the $65B U.S. digital
media market (including search, social, display, video). Programmatic now
accounts for roughly 60% of display and 40% of digital video sales. In search
and social, the proportion is closer to 100%1
. Even programmatic ad spending
outside search (the early pioneer) has boomed; from almost zero in 2010 it
has grown to $22B, with forecasts predicting continued growth to 2020.
How much of the total U.S. advertising market will ultimately be sold
programmatically? We’ll gain greater insight over the next few years as
programmatic ad sales continue to grow share due to increased adoption
within digital media, particularly as traffic migrates to mobile platforms.
Longer term, however, such sales are poised to absorb a significant portion of the total $200B+ U.S. ad market because of the
continued share shift into digital media, and eventually, penetration into the $70B+ television, radio, and outdoor markets.2
The growth of programmatic ad sales has the potential to displace, but
not obliterate, sales organizations. Adapting to the new reality is the key
By Daniel Punt
2. 2 • FTI Journal
DEATH OF THE TRAVELLING SALESMAN?
When applied to digital ad campaigns today, data targeting
typically produces a 50–100% uplift in CPM. Furthermore,
recent FTI research indicates that over 80% of digital
advertisers now demand data-driven audience targeting while
less than 50% demand specific brand, placement, or content.
Preferences for data imply a shift in the relative value of data
versus more traditional media assets such as content and
brand. Data-driven ad sales also require salespeople who can
develop and interpret analytics (a “science”) in addition to
communicating brand and content value (an “art”).
Programmatic ad sales also provide new tools to the sales
team. One example is the private marketplace, which allows
these trends, we predict that more than 50% of the entire U.S.
ad market will be sold programmatically by 2024.
How will this dramatic shift impact sales organizations? While
we do not foresee the end of hands-on, human selling, we do
expect that the size of sales teams will decline, and that selling
skills will evolve. Rather than generating revenue merely on
volume metrics such as sellout and CPM, the sales force of the
future will build revenue based on solution-based sales that
deliver targeted audiences based on evolving ad products, in
many cases across a portfolio of media that includes both
traditional and digital. This will require live sales people to
define and position premium inventory, to engineer integrated
media bundles, to structure upfront commitments and to
customize on-demand options.
According to FTI’s advertising forecast, programmatic ad sales will
account for over half of total U.S. advertising sales by 2024 with
approximately 85% of digital ad dollars sold programmatically.
Growth will be driven by video, which will comprise “most of
what people consume online… within five years,” as Mark
Zuckerberg commented in his Q1 2016 earnings call.
The Impact on the Sales Organization
Programmatic ad sales will certainly change the ad sales
organization — but not obliterate it. While the organization will
no longer require the same number of bodies, it will still need
to create and grow relationships with ad accounts using real,
live salespeople. The sales organization will still need to define
ad products, including premium offerings, and communicate
benefits to buyers. It will also need to support ad buyers in
navigating complex options and in using self-serve tools (as well
as prioritizing how such tools evolve).
A prime example of change in the selling process is how sales
teams define premium ad inventory. The term premium implies
differentiation and scarcity. Traditionally, when creating such
inventory, media companies have considered three tactics:
1) brand environment, 2) placement (for example, ads run in
primetime), and 3) content association (for example, ads run
during the Super Bowl). Now, however, programmatic has
introduced a fourth tactic: data targeting.
Principles of the Future Sales Organization
• Treating advertisers as “clients” rather than simply
• Understanding and aligning client marketing goals with
specific ad products.
• Building trust by promoting transparency.
• Investing in CRM tools that track client needs.
• Educating clients at agencies and small businesses,
possibly even embedding technical resources at larger
2. Solutions-based sales
• Developing solutions experts who understand
marketing and data analytics.
• Constructing distinctive premium offerings that
motivate sales commitments.
• Creating compelling business cases and success
metrics for advertising solutions vis-à-vis major digital
competitors such as Google and Facebook.
• Investing in data assets, such as via a data
management platform (DMPs).
3. Product roadmaps
• Treating ad products as the “tools” used to serve clients.
• Developing product teams who can manage roadmap
• Prioritizing ad products to address client needs – but
• Addressing “self-service”, including integration with
priority media planning and buying tools.