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Atul Patel

Atul Patel Co-Founder and COO

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How AT&T's Acquisition of AppNexus Affects Auto Dealers

Auto dealerships have been known to buy most of their media from the large platforms, namely Google and Facebook. According to the aggregate data of all our current active clients under our analytics program in May 2018, Google paid traffic accounted for 52.56% and Facebook paid traffic for 18.16%. At Orbee Auto, we’ve spent a significant amount of time with our customers educating them on the importance of broadening their reach – especially for retargeting their shoppers – to all available inventory on the web. If you have marked someone as interested with a cookie, why does it matter where they are when you want to show them an advertisement to come back to your website?

AT&T’s confirmed acquisition and planned integration of AppNexus into their advertising and analytics division signifies the telecommunication company’s plan to challenge Google and Facebook for digital ad dominance. The automotive industry is leading the way with digital and TV advertising, and with AT&T acquiring AppNexus, who was under fire for ad fraud last year, what will be the automotive industry’s implications in the digital advertising market?

Dealerships need to put real efforts to reach beyond Google and Facebook

While we see some traffic from outside the common walled gardens, these efforts are usually by third-party agencies or service providers, with the auto dealership themselves not actively seeking this inventory. Dealerships are uneducated about the potential, and with 43% of inventory available outside of Google and Facebook, that’s a big opportunity loss. For instance, we see traffic from Yahoo and Inktomi (a platform acquired by Yahoo in 2003), which is now Verizon Wireless. We see traffic from Bing. However, it’s not enough.

The “Open Internet” and the risks of buying media there

Many of our clients will recognize the relevance of this transaction because for months now, Orbee has been educating them about the “open internet” by using AT&T and Verizon as examples of the vastness of inventory available. It’s debatable if it is even “open” given the recent acquisitions of AppNexus by AT&T, AOL and Yahoo by Verizon Wireless, and even FreeWheel by Comcast and so on. In fact, some of these transactions are allowing these companies to become walled gardens themselves, especially since the Justice Department recently approved AT&T’s acquisition of Time Warner, making it a behemoth of a telecom and media company.

The key point though is that the “open internet” is still immature in terms of tools for brand safety, verification and data management. AppNexus has been known to be riddled with bots, and it’s important to use filters, whitelists and blacklists and every other feature available in real-time auctions. Heck, I don’t even see people using dayparting and that’s ad serving 101. You must control what domains and apps you show ads in; you must optimize on impressions and clicks and actions depending on your goals; and you must watch this like a hawk.

Far too many times, we have calls with dealers red-flagging the very inventory managed by the exchange that AT&T just acquired. In May 2018, we have seen bot traffic as high as 86% for AppNexus IP addresses. To be clear, our reports show the bot traffic for the visitors that actually arrived from traffic sourced within this exchange. This only makes me wonder about the quality of the impressions behind these campaigns.

This is a boon for automotive dealerships who have the right tools

We have encouraged dealerships to gain more transparency over the traffic that their partners are generating and to own and almost hoard the first-party data that their websites are producing from this traffic. This is more important than ever before with the move by AT&T.

Dealerships can’t keep turning the blind eye and just wonder “did I sell more cars?” Your money is being wasted, your brand is being exposed and you’re not spending energy focused on the long-term cultivation of your shoppers whether they are in the market today or if they’ll buy a car in 3 months. It matters now.

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