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May 14, 2015

IPG’s Cadreon Developing TV Buying Software With Video Ad Tech Firm TubeMogul

Wall Street Journal

Cadreon, a digital ad-buying specialty division of IPG Mediabrands, has partnered with the ad technology firm TubeMogul TUBE +1.74% to build tools and software for buying targeted TV ads.

According to Cadreon’s global president, Arun Kumar, the new set of proprietary tools will be aimed at helping IPG’s clients blend data from numerous sources to reach more specific and valuable audiences with TV ads across multiple TV networks.

TubeMogul allows ad buyers to use Web-based software to purchase inventory on various Web sites, local TV stations and, increasingly, national cable networks viapartnerships with companies such as Cox Media Partners.

While the amount of national, prime-time network TV inventory available to advertisers “programmatically,” or on an automated basis, may be fairly limited at the moment, Cadreon wants to get out of ahead of the growing interest among advertisers to buy TV in a similar fashion to online advertising, where precision targeting is common. The agency division says it will be able to meld data from its own proprietary Audience Measurement Platform, as well as data from set top boxes as well as some data from various consumer shopping sources.

Various broadcast networks like NBC are talking about offering more data-driven ad options this year as they look to match the Web’s capabilities in this area. Yet Mr. Kumar said a major part of the appeal of this deal is that it doesn’t limit Cadreon’s programmatic TV efforts to any single network or vendor.

“This enables us to take our data, sync it with other data sources, and do it far more efficiently than we have to date,” he said.

Mr. Kumar was adamant that Cadreon was not building the equivalent of a TV trading desk–a model that has received much scrutiny in the digital ad world. Critics contend that some agencies buy ad inventory at bulk programmatically and sell it to their clients at a markup. “We take no positions on inventory,” he said. “We don’t do arbitrage.”

TubeMogul Chief Executive Brett Wilson said the Cadreon deal didn’t limit the company from inking similar deals with other agencies. But he emphasized that this partnership wouldn’t be easily replicated.

“We’ve never done a deal like this before,” he said. “We are building out software together, and putting a dedicated team on this project.”