Full service or service based? The importance of retaining control

I was speaking to a publisher the other day who was considering a transition from their current outsourced adops vendor and as I dug deeper into their business with qualifying questions, it became apparent how painful such a decision would be. Years ago, they selected a vendor that essentially owns the entire ad stack technology and every relationship with their programmatic demand sources. Because of this, changing vendors (or building an in-house team) would basically require them to start over from scratch. They are at the mercy of this vendor for adserving, programmatic revenue and historical data on direct-sold campaigns. Over time, this compounds to make the thought of any significant change to resources or workflow - which is often required for continued growth - so overwhelming that it becomes abandoned before it even grows legs.

Despite the attractiveness of reselling software and establishing preferred (paid) relationships with demand sources and other platforms, we have chosen to remain independent of these for one simple reason: we put the needs of our customers ahead of our own (see our principles). In many ways, this decision puts us at a disadvantage, especially when it comes to publishers looking for “full service” solutions. They want a firm that will implement and manage everything end-to-end, from adserver selection to ad tag implementation to choosing demand partners to collecting payments. All these publishers want to see is ad revenue hit their bank account on a monthly basis. At least this is what they think they want. But what happens two, three, or five years later, when they have grown to the point where they are investing in their future and place a greater emphasis on controlling their own destiny? If they own the relationships, they have a much greater selection of options in front of them, regardless of where they choose to go.

With software, you can charge the customer while you are sleeping. What a great model! SaaS companies have the multiples they do for a reason. With a service business, you have to hustle, plain and simple. Its hard work. If you can’t deliver what you say you’re going to deliver, you won’t have a business for very long. On the other hand, this allows us to recommend whatever software, services, platforms and partners are most appropriate for our clients’ businesses. We have no incentive to recommend one solution over another unless they are best in class and best-suited for the situation. This also allows us to focus all of our energy and attention on the needs of our clients and not spend time supporting software and platforms that we ultimately did not build ourselves.

This decision has also allowed us to remain small. Modern business culture has indoctrinated us to revere growth and scale and almost scoff at businesses that are smaller, either by necessity or by choice. As I’ve written about before, remaining lean has its advantages. It allows us to live our values without compromise. We move quickly and adjust to rapid fluctuations in our business and the industry. Over time, I have learned to filter out the noise and focusing on what is really important: adding value for our clients. If we can do that, everything else will take care of itself. They will retain us over long periods of time, refer us to other publishers and allow us to innovate as the market evolves. These things will result in more business, and more business means the opportunity to be selective about the projects and clients we work with. If we do that, just like our clients, we will be able to control our own destiny.