Story released yesterday:  Mediamath Acquires Adroit, Combines DSP with Dynamic Ads

Analysis: At first blush, this deal makes sense.  I haven’t seen performance data for MM, but assume their optimization algorithms are up to snuff, and will dovetail nicely with the dynamic creative and self-service UI chops of Adroit.

As with the Adobe/Omniture move into Level 2, the question will now be – can they execute?

Zooming up a level, the pace of consolidation seems to be accelerating.  In this case, Level 1 (media optimizer) acquires Level 2 (creative optimizer).  However, if you look at each of the three levels of media optimization, there are multiple recent examples of consolidation/integration:

1.    X+1 venturing into landing pages (level 1 to level 3)
2.    Adobe/Omniture announcing creative optimization (level 3 to level 2)
3.    MediaMath purchasing Adroit (level 1 to level 2)
4.    Adchemy (building levels 1, 2, and 3 from scratch)
5.    Aggregate Knowledge (building levels 1, 2, and 3 from scratch)
6.    Dapper (building levels 1 and 2 from scratch)
7.    Choicestream / MyBuys / other recommendation engines moving into advertising/creative (level 3 to level 2)
8.    … and more that are only rumors and/or under NDA at this point

There’s an interesting dynamic (no pun intended) evident in the quotes by CEO Zawadzki. On one hand, he stumps for the simplicity of a unified solution:

“Even agencies that recognize the value [...] are deterred by the complexity of navigating multiple technologies and making sense of the results. The combined Mediamath and Adroit systems could remove some of those obstacles, said Zawadzki.”

Yet in the same article he leaves the door open for working with other (now competing) creative technologies:

“‘We will and do continue to support other dynamic creative solutions,’ like Tumri and Teracent, stressed Zawadzki.”

The reason why such seeming double-talk is necessary is because it has not yet become clear whether integration via partnership or consolidation/unification via acquisition (or internal build) will become the dominant trend among the various participants in the display optimization landscape.  Consolidation yields simplicity and likely, in my humble opinion, better performance.  Integration allows flexibility of partner choice – enabling the mixing and matching of participants from each of the individual optimization tiers.

My bet, and apparently the bet of companies like MediaMath and others mentioned above, is that simplicity and performance will eventually carry the day over flexibility.  It will be interesting to see how this plays out.

Ok, enough ad tech talk – back to vacation!

(PS – on a more personal note, congratulations to Dan Faga and Vivianna Padilla on their impending nuptials!)

“The Path Forward” of the Postal Service

The money quote:

“The Postmaster General warned that if the Postal Service continues to operate as it is, it will run a cumulative debt of $238 billion over the next 10 years. Even if the Postal Service institutes every conceivable control within management control – product and service actions, productivity improvements, workforce flexibility improvements and purchasing savings – it can only shrink the debt to $115 billion.”

Omniture Announces Display Advertising Solutions for Increased Return on Ad Spend

Interesting on a number of levels:

1. As discussed, we see a continuing trend of optimization companies migrating into adjacent segments.  In this case, a L3 player has migrated into L2.  (Did ADBE just become a potential buyer of DSP technologies? That would complete their stack.)  Strategically, I like it – execution will now be the key.

2. Adobe/Omniture is much larger than most other participants in this space, the principal exception being Teracent/Google.   Though they’re new in the space, expect them to leverage existing relationships to sell these additional services through.

3. The potential impact this may have on Flash as the de facto standard for dynamically generated ads.

USPS to propose 5-day mail schedule, major cuts

The most important quote:

“USPS posted a $3.8 billion loss in its 2009 fiscal year, the latest in a multiyear string of whopping losses. Mail volume was down 12.7% for the year, a trend the agency expects to continue over the next decade as more consumers opt for online bill payments and message delivery.  The Post Office was $10 billion in debt as of Sept. 30 — not far off from its $15 billion debt limit, which the agency expects to hit in its 2011 fiscal year.”

The USPS will require a bailout, count on it.   Is that a good idea?

Reasons that support a bailout:

1. The USPS is the second largest employer in the United States (behind Wal-mart) – a bailout would preserve much-needed jobs in an economy that is still on less-than-solid footing.

2.  ? (I’m sure there are other reasons that I’m missing..)

Reasons against a bailout:

1. Bailout money will be used to hold down postage prices for junk mailers – some of the largest companies in the world.  (Over 50% of mail volume is junk mail.)

2. Bailout money will increase and prolong the environmental impacts of junk mail.  (I’m not a dyed-in-the-wool green, but even I know that printing credit card offers on felled trees, and flying them all over the country is bad for the environment.)

We should also note the difference between a bailout and a permanent subsidy.  It’s probably a good idea to use government funds to cushion and ease the exit of an information distribution medium that, in the words of the Postmaster General, represents a “macro shift in society.”  It’s a terrible idea to use governments funds to artificially prop up a failing industry ad infinitum.

Could Longer Lines Be Coming to Your Local Post Office…Lottery Lines?

I don’t know about you, but the phrase “grasping at straws” seems somehow appropriate…

Since its inaugural event in 2005, Philly Fight Night has become one of the biggest events of the year for Wharton students. Rather than describe the event in even more detail, I’ll just link to this year’s promo video instead. You’ll get the picture.

Credit where it’s due: This event was the brainchild of David Birnbaum, Schuyler Coppedge, and R.T. Arnold, with the inimitable Greg Battle serving as the evening’s MC . I’m proud to say that all of these fine gentlemen were my classmates in the Wharton MBA Class of 2005. Five years later, and still going strong. Nice work, guys!