Brenda Hetrick, President of Matrix Solutions, joins Cross Screen Media CEO Michael Beach to share the challenges facing media sellers in a convergent TV environment and how technology can bridge the gap for buyers and sellers. Watch our latest Screen Wars Thought Leader Interview here and read the full transcript below!
Michael Beach: All right, Brenda, welcome to Screen Wars.
Brenda Hetrick: Hi, nice to be here. Thanks for having me.
MB: Would you mind giving our audience some background on Matrix Solutions and the problem you solve?
BH: Sure. Matrix is a media technology company focused exclusively on the media industry. We have one core product, and we are building another one. Our core product, Monarch, has evolved over time. The most current version is an open architected revenue management platform with components of CRM. It features advanced reporting, native integrations with your traffic and billing system, pipeline management, account and contact management, agency workflows.
It has all a media seller would need to forecast their business if they work directly with agencies. If they work with an individual advertiser at the local level, we also have workflows that fit those needs as well. And as the industry changes, Monarch, being an open platform SaaS solution, has changed with it. Whatever you’re selling, whether it is cross-platform or multimedia, we have the ability to capture that pending forecast and revenue, wherever you’re selling, with the CRM component included. That’s our core product.
Our CEO Mark Gorman believes that the industry needs a converged workflow. That a linear spot is not necessary, except for live events, such as sports, that will always need a linear spot. Most ads are going to be delivered in some type of converged workflow, and we’re building that product for the future.
So, whether it’s digital, whether you’re sending it to an ad server, whether you’re sending it to a linear traffic system or to multiple places, we’ll have the ability to push that order into the appropriate execution layers. Admiral will be tracking from the sales side what the proposal is, and also offer ways to optimize the inventory and the advertising. Potentially, it will even package them up some AI, to suggest “This ad should go with this ad,” to give the advertiser and our company, the best ROI.
We are testing that product in a few markets, and we’re really excited about it. We had investment from media companies, including Hearst Broadcasting, Gray Television, Graham Media and CoxReps. And one of our core beliefs is that the industry needs to change. If we all can work together to move the marketplace, change becomes easier, as opposed to a single technology company trying to force that change.
MB: It sounds like those groups are very interested in video ads, or does that extend to all types of ads?
BH: All types of ads. Many local broadcasters have their local spots. I don’t know about any of our clients not using some type of OTT, CTV, or streaming service of their own. Typically, I think more aligned with local-type content. However, I know a lot of our clients also got the network part, and their FAST channels are becoming more and more popular. There are multiple ways to monetize their inventory, but I would say that most media companies have some component of linear spot streaming, addressable, OTT, CTV inventory.
”If we all can work together to move the marketplace, change becomes easier, as opposed to a single technology company trying to force that change.
MB: Interesting. This is a broad question, but what do you think are the top issues media sellers are facing today?
BH: One of the top issues they have is that they have a lot of inventory to sell, what we would call a product catalog. They have to understand what the advertiser is looking for as far as the results, and the attribution. Where do they want that ad to be seen?
There are a lot of moving parts. You used to be able to go to your local auto dealer and say, “I can put you on the six o’clock news. This is what you’re going to get, and these are our demographics.” But those days are long gone.
Now, you have to put a media mix together. The sales organization has to understand data, and they need to understand that media mix. They have to understand what combination or inventory is going to provide the buyer the outcomes that they’re looking for, as well as maximizing the yield for their organization.
The industry is making sure that they capitalize on all of those changes. The prediction is that we are not necessarily cord cutting, but people are not loyal to a single streaming service. Someone that got Apple TV to watch a show is going to move to Disney Plus the next month for another show. So I think there are some concerns there on how to ultimately make money. How do we keep monetizing the inventory?
Content really is the king. If you’ve got good content, you can monetize it. You have to make sure that there is always good content, and creating good content can be expensive. Local information, whether it’s news or whether it’s local shows, are still very, very popular in the local sphere. I think there will always be space for that.
We were talking earlier about sports, so if you’ve got the Sunday Night Football game, and the Pittsburgh Steelers happen to be on that game, and you’re going to have news on after the game, that’s probably a huge draw too for advertising dollars, because live sports lead into that.
I think the worry, from a publisher’s perspective, is probably, “How do we capitalize on all the multi streams the way we can, and what’s that cost going to be?”
The other problem in the industry is that there are a lot of legacy technology systems, and it is not inexpensive to move to a current system. So I think one of the tops issues is also understanding when we need to move the technology, so that we’re ready for the market when the market gets there.
”Local information, whether it's news or whether it's local shows, are still very, very popular in the local sphere. I think there will always be space for that.
MB: This is very hard to recreate. And it is substantial that local broadcasters figure out a way to do it profitably. We got to figure out a way to capitalize on it.
Coming back to your point about Netflix and Disney Plus, about 9.8% of all TV viewing happens on those two platforms, according to the Nielsen numbers for December. These two platforms are coming in with an ad model, and of course, not all of their users will be on the ad supported plan, but that move is like two major networks, like ABC and Fox, appearing out of nowhere in terms of viewership time. It’s a huge inventory, so it’s definitely time to get your defenses up with that local contents now.
BH: Sure. A couple of years ago, our CEO, said that, in the US, the advertising revenue from the top five media companies is equal to Amazon’s. When you think about that, it’s just amazing where the advertising revenue is.
They should be able to say, “An advertisement running on my broadcast is more valuable because it’s seen here, and I can guarantee you this audience and this who’s seeing it.” There has to be a way for broadcast companies to get their inventory sold as easily as on newer digital platforms. Everyone understands that, and these companies are working towards getting there. Not only technology has to be there, they have to be able to morph into that.
It’s also hard to always get to every market in the US. Coming back to your point with Nielsen, they don’t rate every market. They don’t necessarily have the ratings of some smaller markets. However, a particular advertisement running in that market might be more valuable, because the 10 people that see that might all be buying Ford trucks, versus a thousand views in another market where no one’s going to be buying a Ford truck. You got to be able to buy that inventory easily.
”A lot of companies are carrying a lot of make good inventory or make good numbers for months and sometimes years, and that's just not efficient. We need to address that.
MB: Absolutely. What do you see as the biggest disconnect between buyer and seller?
BH: We actually have founded a media ad sales council, with our clients and other media companies, and we talk a lot about buyer and seller’s perspective. From the sales perspective, we see that they want to sell their inventory a certain way, and they want the buying side to buy it.
On the other side, the buyer potentially has a digital agency that buys the digital, and different agencies that might buy the OTT, and the programmatic, and the linear. And these agencies don’t always talk to each other. So there are five different components that you have to put together to get to the same budget.
We want to automate that process, with the RFPs coming in, negotiating through that process automatically. When there’s less paper, there’s less opportunity for people to make inputs and create mistakes.
They want to be able to do transactions in the same system, and they also want to be able to have a common measurement. I don’t think Nielsen is going to go away, but there needs to be alternative measurement components, and the potential to normalize against the benchmark. Something has to happen, because they want to have a more consistent measurement for their inventory. A lot of companies are carrying a lot of make good inventory or make good numbers for months and sometimes years, and that’s just not efficient. We need to address that.
I always say that there is still a lot of money being made in advertising. This is still a multi-billion dollar industry. And when companies are making a lot of money, it’s hard to get people to make a change. Because while the system might be inefficient, and somewhat laborious, we’re still making money. But we need to take out those inefficiencies and friction.
I always think about when monster.com came around in classified ads. And almost overnight, that whole business went away for newspapers’ classified ads. And I don’t think the advertisement industry is there yet, but I do think we have to get the friction out. We need to solve that agreement on measurement, and how the transactions are going to work.
And technology plays a big, big part of that. You have to agree on a technology that works for both sides. And that’s an area where the sell side might want to have their own, and the buy side wants something to support their needs, and we’ve got to be able to work together.
But again, things cost money. If you are the predominant source of a certain part of the transaction, it’s working, and you don’t have competition, spending to upgrade your technology might not be top of mind for you.
You have to get people to agree that this is the right thing for the industry, and then start to show. We strongly believe that rising tides lift all boats. And we believe that the industry should share this to make the process more efficient.
”Someday there's going to be a converged buyer and seller, and we are seeing the movement to a holistic view of their product catalog.
MB: I’m a recovering agency founder, and before starting CrossScreen, we always had a lot of trouble buying the local sellers’ digital inventory. And then we got into TV, and we really had trouble understanding gross rating points, and spots, and everything. But it’s interesting. Now we work with so many linear buyers, and they have the same problem on the digital side.
To your point, it really depends on where your worldview is. You have trouble seeing beyond that. And there’s probably an equal opportunity on both sides. One day, there’s going to be a converged buyer and a converged seller. It’s an equal opportunity, even from the digital platforms that have not been able to crack into the TV buyer, who still has over 65% of the budget for video.
BH: Right. We agree with you. Someday there’s going to be a converged buyer and seller, and we are seeing the movement to a holistic view of their product catalog. Whether it’s their O&O digital, whether it’s their linear spot, whether they have some component of a network, or they have national inventory that’s purchased in an upfront model, across the board everybody needs to be aware of what’s available and what’s being sold.
As that happens, that will force the agencies to also come at it from a consistent perspective. I remember one of our clients said to me that they had an RFP come through, and they needed to supply a thousand impressions. And she didn’t get back in time to the RFP, because she had to go market by market to figure out what everything was, as opposed to just saying, “I can give you a thousand impressions. Let me worry about where you’re getting it. I’ll guarantee you’ll get that.” And I think we have to be able to do more of that.
I think they understand that, and I think it’s coming, but there’s a lot of moving parts to accomplish that. And higher rated markets are probably doing way better than other markets, because they just have to be able to buy that market that way.
And I know the publishers are working to make it very easy as well, trying to get the ability to purchase all of our inventory by coming to one person, versus going to every market and getting the six o’clock news in 10 different markets. It’s happening. We thought it would happen years ago, but it’s still happening, slowly.
MB: I just have a couple more questions. If you could wave a magic wand and change one thing about the local video space specifically, what would it be?
BH: The ability to transact more seamlessly. There’s always programmatic opportunities, but being able to buy that market seamlessly is what I would say.
I would also say that some of their business practices. It all ties together, but there needs to be an evolution of understanding the current value of transacting, and making sure we’re all on that same page. There’s a lot of legacy in the industry, and it’s not just technology. I would like to see everyone getting to that same point.
The reason why we did Admiral was because we sit clearly in the sell side. We believe strongly in creating a product that does serve the sell side with the ability to answer an RFP, or an upfront, with one transaction, as far as what you’re able to offer, and to push it to the appropriate execution layers.
And also to cleanse and normalize that data, so that if I’m the Chief Revenue Officer, and I want to know what McDonald’s is spending with me, I can easily see the total, and I can drill down into all the inventory that McDonald’s has purchased. And then I can, from an agency perspective, see who owns it from the agency, how did the buys come in, and have all of that holistically.
I think we need to get there, but we have to get there working all together. It just can’t be one offs here and there. The whole industry needs to do it collectively.
MB: Awesome. I know our audience is going to love this conversation, and I’m grateful for your time.
BH: Thanks for having us. And Matrix is very appreciative to Cross Screen Media. Thank you very much.
See the rest of the Screen Wars Thought Leader Interviews here!
Brenda Hetrick, President for Matrix Solutions, believes that growing a company to greatness is fueled by organizational passion for strategic and innovative solutions that drive revenue and align with overall business goals.
Brenda founded and hosts the Matrix Means Media podcast, co-founded the Media Ad Sales Council (MASC) as well as the Media Ad Sales Summit and its online Candid Conversation series – all of which are forward-thinking efforts that bring together top leaders from across the media industry to collaborate, promote, and advance the future of buying and selling media advertising. She is committed to and an advocate for empowering women in the media industry. She has served as a Gracies Judge for the Alliance for Women in Media (AWM) for many years and in 2019 she joined their Board to expand her commitment and support of the organization. She currently serves as the Treasurer-Elect of the (AWM/F) Board.
A Pittsburgh native and sports enthusiast, Brenda is very dedicated and passionate when it comes to her hometown teams including the Steelers, Penguins and of course the Pitt Panthers. Brenda holds a B.A. in Economics and Political Science from the University of Pittsburgh and an MBA from Robert Morris University.
Cross Screen Media is a marketing analytics and software company empowering marketers to plan, activate, and measure Connected TV and audience-driven Linear TV advertising at the local level. Our closed-loop solutions help brands, agencies, and networks succeed in the Convergent TV space. For more information, visit CrossScreenMedia.com.