Ratko Vidakovic
AdProfs / Founder
Ratko Vidakovic reflects on why some industry veterans feel ad tech isn’t as fun as it used to be, attributing it to economic challenges, regulatory pressures, and ongoing issues in the field. However, he argues that the industry’s current phase of transformation presents new opportunities and that the cyclical nature of the industry means that while the landscape is changing, it is also ripe for innovation and future growth.
I was originally going to write about my observations from Cannes, specifically around ad tech.
As far as ad tech topics go, Cannes was nothing exceptional. It was more or less a reflection of
the topics we encounter every other week of the year, except with some added hype around AI.
However, I stumbled upon a thought-provoking LinkedIn post from an industry veteran:
This sentiment about how ad tech isn’t fun anymore struck me as an interesting topic to
explore, particularly in the context of Cannes.
Why do People Think AdTech is not Fun Anymore?
It’s understandable why some people, particularly industry veterans, might feel like ad tech
isn’t fun anymore. We are no longer in a low-interest rate environment. Money is no longer
cheap. Ad tech companies are no longer going public like in 2021. Ad tech entrepreneurs will
also tell you about the dismal environment for raising capital. Valuations are not what they
once were. Profitability and survival are paramount, so we see increasing layoffs from across
the tech industry.
In addition to these economic conditions, we have growing regulatory pressure in Europe and
beyond regarding data protection and privacy. Big tech platforms like Apple and Google are also
making the technical environment more challenging: Apple with its scorched-earth approach
and Google with its Chinese water-torture approach. As a result of these privacy-driven forces,
we are seeing the rise of walled gardens, large and small, fueled by first-party data, clean
rooms, and various forms of identity solutions.
At the same time, the industry is still wrestling with many unresolved issues, such as brand
safety, misrepresentations in bid requests, convoluted supply chains, low-quality inventory
(e.g., MFA), dubious metrics, misaligned incentives, and so on. Many of these issues have been
talked about for over a decade, which can be demoralizing for those who have worked in the
industry for a long time.
Some of these negative issues were discussed at Cannes on the odd panel, but from my
perspective, they were rare. This is probably because they are somewhat of a buzzkill to discuss
in a place where people are trying to have a good time, stay positive, make deals, and build
relationships. No one wants to be a Debbie Downer or bearer of bad news.
It’s understandable if the zeitgeist feels depressing or devoid of fun when you add up all the
challenges and changes the industry faces. The industry is at a point right now where there’s a
lot of change happening, not unlike the changes that happen in one’s body during adolescence.
It can feel weird, awkward, and even scary. One could argue that ad tech is currently going
through adolescence as it matures. Old ways of doing things are going away. But with that
comes new opportunities, business models, and solutions.
Reasons to be Optimistic
Yes, money isn’t as easy as it once was. Things are more stressful and uncertain, and systemic
issues continue to plague the market. However, many of these challenges are simply a function
of the current moment. If we take a step back and look at everything with a little perspective,
there are just as many reasons, if not more, to be optimistic.
Things may not be fun right now, but there are so many things that have yet to be resolved.
For example, we are still dealing with legacy ad verification and brand safety vendors, and their
associated business models. The whole category is currently in the middle of a reckoning and
ripe for innovation, particularly from upstarts in the space. The entire space around identity
solutions will likewise have its own reckoning as the industry searches for durable solutions to
targeting, measurement, frequency, etc. I believe many of these current headaches will be
solved in the next 3-5 years. If we step back and zoom out, new solutions with new
technologies will be applied. Hype aside, I believe there is still tons of untapped potential with
AI and machine learning applied to ad tech.
Another plotline that remains unfinished is about Google. It’s not a given that Google will
continue to lord over the industry in the coming years. There are various ongoing antitrust
cases against Google. Competition authorities worldwide are focused on Google, its ad
business, Chrome, and its impact on the rest of the industry. The consequences of these cases
could completely change the industry’s trajectory and open up the market. It could open up
new ad-serving opportunities that could add much-needed oxygen to the space.
Some Personal Perspective
I was on the fence about whether or not I should attend Cannes this year. I had some business
reasons to attend, but a dinner invitation from an old colleague finally pushed me over the
edge, and I booked my flight. Shortly after arriving, I realized how foolish I was to consider not
attending.
Fate could have had us in an industry where events take place in a stuffy conference room at a
suburban Holiday Inn. Instead, we have the opportunity to congregate at Cannes. Granted, not
everyone has the same opportunity or desire to attend, but it’s hard not to feel some degree of
gratitude around this fact.
Furthermore, whether you work on the industry’s tech, marketing, or commercial side, it’s not
like we are mining for lithium in the Congo. Working in ad tech is like riding a jet ski in
comparison. To complain about the lack of fun in ad tech from the French Riviera is rich.
A Different Kind of Fun
Ad tech is also a different kind of fun. When everything was new and exciting, as it was over the
last 15 years, and things were on Easy Mode in comparison, sure, that’s fun. But we are also on
the precipice of a new frontier. As programmatic and RTB disrupted the ad network era, privacy
and regulation are ushering in the beginning of a new epoch. As a result of all the changes and
disruptions taking place — like the rise of walled gardens, CTV, and retail media networks (and
the resulting fragmentation) — marketers are starting to question and reevaluate their
fundamental methodologies for measurement and attribution.
By the time everything shakes out over the next 3-5 years, chances are high that the economic
cycle will be back on the upswing. This kind of stuff is just cyclical. The reason people might not
feel like ad tech is fun anymore is just a combination of different forces — part economic, part
systemic — at a single point in time. It’s easy to get caught up in the zeitgeist. But it’s all just
part of being in a maturing industry.
The industry is going through adolescence, which can feel weird and unsettling. People felt the
same way in 2001 when the dotcom bubble crashed and in 2008 when ad networks were dying,
and programmatic was the shiny new thing. If you were an ad network at the time, it probably
felt very awkward and apocalyptic. But in retrospect, it was all just part of the ongoing cycle, and a new era emerged.
If your idea of fun is late-stage ad tech from the previous era, then, yeah, that ride is probably
over. As we transition to the next era, it’s going to be fun and exciting for some people but not
for others. In many ways, it boils down to one’s attitude toward change.
As much as I hate to reference corny management books, the 1988 book “Who Moved My
Cheese?” perfectly encapsulates the state of the ad tech industry in 2024. The characters in the
fable, a group of mice, face an unexpected change when their cheese is moved. Two mice adapt
to the new reality and search for new cheese, while the other two struggle to accept and adapt
to the new reality. The story’s moral is that change is an inevitable part of life, so it’s best to
embrace it, adapt as necessary, and enjoy the adventure that the process brings. Also, the
sooner you let go of the old cheese, the sooner you can find new cheese, so to speak.
The Human Element
This point is trite but worth ending on: relationships make all the difference in one’s attitude
towards the industry. They also happen to be the primary reason for attending Cannes. One of
the most common truisms about Cannes is that if you’re coming for the content, you’re doing it
wrong. Like most in-person industry events, Cannes is about connecting with people and
building or strengthening relationships. The atmosphere and setting of being on the French
Riviera add something memorable to the encounters — a shared experience in a special place.
These memorable encounters and relationships have the potential to endure beyond the
inevitable ups and downs that the industry experiences over time.