A Paradigm Shift in Transparency and Collaboration | Eric Nelson
3.12.24
David McBee: Hello and welcome to Simpli.fi TV, the web series and podcast for agencies, brands, marketers, and media buyers. I'm David McBee. Our guest today is Eric Nelson, co-founder of Fraction Media Group. Eric has led strategic media and engagement planning across all media channels from influencers and CTV, to retail media, to product placement integrations and lead generation, ranging from network television to local outdoor. Eric's experience crosses from traditional to digital, online and offline, and everything in between. He was a co-founder of 314 Digital in St. Louis, and was an adjunct professor at the University of Missouri, St. Louis teaching digital marketing strategies. Eric, welcome to Simpli.fi TV. Eric Nelson: Thank you. I'm really excited to be here. David McBee: I'm excited to have you. Eric, I understand that Fraction Media Group takes an independent and new approach to the media agency brand-vendor relationship. Can you tell me more about that? Eric Nelson: Yeah, definitely independent. How new is in the eye of the beholder, but what we're really after is the true transparency that a lot of the industry talks about but doesn't always come through. What I mean by that is that we really take the foundational element of we don't own anything. We're not a cashflow organization, so we're not looking to extend billing terms and those types of things. We're not chasing hours or large scopes of work and things like that. We just want to do the work and have fun, but we want to have the vendors just as much a seat at the table as we do. When we're working with brands and clients, we don't want to own anything. None of that data, none of the information, and even the relationship between Simpli.fi and our clients, we bring Simpli.fi to the table, a lot of our status meetings will include our Simpli.fi reps because everybody really needs to know what's going on and what's happening and things like that. Everything from what the clients are actually paying for, where those ads are actually going, we want true transparency in anything and everything that we do. The clients have been really receptive to it. They really enjoy the fact that we as an agency don't own anything, that they as the brand own it. Even in terms of even billing, so the billing doesn't actually go through us as an agency. Simpli.fi, and those brands actually work together on the financial part of it, as much as we do on the planning and the execution side. It's really a true transparency, soup to nuts, all the way through. It's been really helpful and allows us to get approvals faster, get campaigns started faster, get creative coded and in the systems faster, and new ideas and things like that because we're allowing partners like Simpli.fi to come in and do things deeper than the traditional agency model where there's a kind of middleman or go-between. It's made things a lot faster, a lot easier, and quite frankly, a lot better. David McBee: Instead of taking a Google AdWords campaign and then marking up the cost of the clicks, you set up Google AdWords and they pay them directly, and then pay you a fee to manage it. Same thing with Simpli.fi. I assume you're not marking up the CPM, you're giving them the actual CPM and then charging a fee for the role that you play. Tell me about that role. How do you not lose clients to go direct to the vendors? What do you bring to the table and how do you position that? Eric Nelson: What we bring and where we fit in really is the overall strategy, and then the data on the backend, of really being able to interpret the data. Not just of what we're doing with an individual partner, but really a much more holistic view. We're able to connect a lot of the dots between the online and the offline, what's happening with PR, what's happening with influencers, and bringing that all together. It just allows us to do it faster and easier. The way we get paid is we negotiate with our clients a fair fee, but they should know exactly where their money is going. That's why there isn't necessarily a markup. There are other ways to do it, this isn't the only way to do it. But, we also don't want to be commission-based in those types of things where we might have a preference to say, "Well, we have a larger commission, or we can charge a larger fee to work with Google than we can with Simpli.fi," so we might lean towards Google. We don't ever want to do that. We want to do it because it's the right place to do it and the right tactic or the right environment for the brand and for the campaign, not based on how much money we'll make. We also never want our clients to have to make a business decision every time they pick up the phone to call us. They don't have to worry about our hours, or are we burning through too many hours too fast? Are we going to come back in six weeks and go, "Well, we did all that work and now we're out of time. We've got to redo our scope of work," and all those types of things. We find we'll have those conversations, but those conversations are a lot easier to have when everything is open and transparent. We have partners at the table like Simpli.fi that actually rely on us also to kind of help sell in things because we see more of the global strategy and more of the things that our Simpli.fi reps may not always be privy to. David McBee: I assume that because transparency is such a staple for your company, not only do you pass that along to your clients, but you must insist on it from your vendors as well. Eric Nelson: We try to. I mean, there's always room for improvement in things like that. But, we do lean on the partners that are good for us but also believe in that transparency, and that are open and willing to be as transparent as we need them to be and want them to be. That's on the front end and the back end. The front end being at the table with the client, understanding that there's no markups, understanding how our fees work versus their fees and those types of things. There's that piece of it. But also, on the data side. Understanding how deep we want to get. Not every client really understands some of the complexity and some of the depth of the data that's actually there and available to them. That's where, again, we come in and we sift through that with your teams and with the Simpli.fi team to go, "Okay, what's really relevant? What really matters? How do we improve upon that?" Then bringing that to the client together to say, "Yeah, and here's where the improvements are." Maybe it's a new tech, maybe it's a new way as Simpli.fi continues to grow, a few years ago, it was the purchase of Advantage and some of the access now to linear inventory. As those things grow, it's been really helpful to have everybody together at once. David McBee: Yeah. Let's talk about CTV for a minute. I mean, it's been around for several years now, and nearly everyone is streaming TV these days. I think I saw a stat the other day says 84% of households regularly stream television. The technology is really still in its infancy. Wouldn't you agree? Eric Nelson: Yeah. I think there's a lot of maturity left in the market. Where not only from a technological standpoint, but I think 84% even feels, as large a number as that is, and if you look at, I'm an old linear guy, so if you look at old Nielsen data and things like that, 84%, you think, wow, that's a big number. But, I almost feel like that's low these days, especially with the availability of so many different platforms and people jumping from platform to platform. Some of the bundling deals that are out there between you have an AT&T and Max, you have Verizon and T-Mobile with Peacock or Netflix or one of the other providers. I think we're going to see a lot more of that start to happen. I think 84% is probably less. I think the challenge for us too, not only is the tech, we look at it from a tech standpoint, but I think from a consumer standpoint, they don't view it as connected TV. I think we get caught up in that sometimes as marketers. The average person is just kind of going, "I just want to watch TV in my living room." That's where I take CTV and this is where we start to look at it and go, "What environment are we trying to reach that audience in?" Because the audience still matters, but where are we actually talking to them? Is it on their phone? Is it on their desktop? Is it in the big square box in the living room with some co-viewing and those types of stuff? I think there's still a lot of advancements to go where we align on the metrics of what CTV is, but also on the technology itself of what's streaming from where and how, and programmatic versus direct, and all those types of things. There's a lot of maturity, I think, that's still yet to come. David McBee: Yeah. Well, how about these linear buyers that were really, really used to buying their advertising based on programming. I want to be on the news, I want to be on The Tonight Show. In the world of streaming TV, we really try to sell audience-based targeting and less program-based targeting. What do you say to them? Eric Nelson: It's a different model. I think the two aren't as different as some people may think. This is where I've talked a lot over the last couple of years about show-level reporting, but not show-level buying. Even as a buyer, somebody with a linear background, I don't necessarily want to buy program by program because I want the audience. I'm really not as concerned where they're watching or what they're watching, as long as I'm getting to that right viewer. But, where the show-level information really starts to coexist is it brings some of that comfort level to the linear buyer to go, "Okay, I understand that's where my spot actually ran." But, it also brings some clarity to, yes, my viewer, that makes sense that my audience I'm trying to reach is actually the one watching that show. That's a show that they would watch based on whether we're looking at MRI data or other platforms, other kind of third-party research and those types of things. We can start to really align those. I think that will start to ease the comfort of linear buyers. I think conversely, the digital buyers, CTV buyers that are so used to programmatic environments don't understand, I mean, they couldn't tell you what a Nielsen GRP is. Kind of mixing those two things, I think there's knowledge that needs to go both ways. I think that the CTV style buyers and the digital native buyers need a better understanding of what that linear model was. I think there's a lot of evolving there. I think that's, like we were talking before, it's where the industry, we need to convalesce over a single metric, a single number way to evaluate some of these things. As silly, or we can have whatever argument you want over the classic Nielsen numbers and Nielsen ratings. I mean, I've got the Nielsen DMA map over my shoulder. We can argue about what that was, but it was an industry standard. If it was bad numbers, it was the same bad numbers for all of us. I think right now there's a little bit of a challenge of we're all using different evaluation models and different ways to get there. I think that's part of the challenge and part of the hesitation from a linear buyer who has a very distinct, I know what it is, I know how to evaluate, I know how to buy it, and there's a clear distinct schedule, versus what we do in the CTV space where my prime time is not 8:00 P.M. to 11:00. My prime time starts at 10:00 P.M. when my kids go to bed and I can sit down and start to absorb the content that I want. That's really what's changed here. I think that's where there's some struggle of differentiation of understanding that an audience is when and where they want to be, versus buying the day part in a leader model to say, no, that's when my spot is going to air. David McBee: I love that you want to target based on data and the audience, and then there's just that linear soul that you have wants to see the shows that your ads delivered on. But, I want to challenge that for a minute. I probably fall into the males over 50 outdoorsy audience. I love to travel, I love to hike, take my Jeep out in the mountains. But, if you were to target me with those kinds of ads, hiking boots, jeeps, whatever, you might discover that you're delivering all your shows on rom-coms because I'm a hopeless romantic, and that's my favorite go-to is watching old '80s and '90s rom-coms. When you get that report that says, "Oh, well, we're delivering these Jeep ads on these shows Pretty Woman and Overboard," and whatever silliness I'm watching, then what do you do with that information? Do you just start to understand, "Oh, my audience is watching something other than what I thought they were watching," or do you say, "I think the targeting is all wrong," and you kind of freak out about it? Eric Nelson: No, I think there's a little bit of both. Right? There's a little from column A, little from column B on that one. When I start to look at that and I see, wow, a lot of those rom-coms, so a lot of unexpected things. Then that makes me start to question and kind of go through and go, "What else am I missing in my other platforms?" What am I missing maybe if I'm doing some display or retargeting, can I match that back and go, "Well, what kind of websites am I seeing across there? What's the buying patterns?" Those types of things. I can start to match that and start to maybe find a storyline to go, "Wow, that is the type of content that I want," and now I can change maybe some of my socials, my influences, those types of things so I can model around that. It's not necessarily a bad thing. It doesn't automatically say, "Well, I can't be here." But, it might tell me a different story that I've got a wider segment of audience than what I thought. It doesn't have to be to that target, you're taking your Jeep out, so I've got to have football and I've got to have the sports and the hardcore stuff, that I can actually move away from that in some other platforms as well. The second part of that is, again, it's that opposite thing where I start to go, "Okay, well, does that make sense? Does that not make sense?" Is there a way that I can start to optimize off of that to go, "Okay, well do I need to," and then I can bring that also back to the creative teams to say, "Hey, we're seeing a little bit of this. Is there a message there that we can bring in?" Again, this is the media guy saying let's customize our message a little bit and can we twist that a little bit to kind of meet an audience that maybe we didn't think was there? Then part of that, too, will be device-based. Right? We talk about, again, the environment that I like to chase is a lot of that viewing of the rom-coms, things like that, in the big square box in the living room. When we start to see large stream formats, that tells me maybe there's a lot of co-viewing going on as well. Again, now maybe I'm spilling into, and this is again an old linear term, spill. Now I'm not only getting the audience that I want, but I'm also spilling to an influential audience where maybe your wife or girlfriend or everybody's sitting on the couch with you or your kids, where they're now getting influenced and seeing those spots and those types of things. Again, I can start to adjust creatively or I can adjust. It doesn't necessarily mean, and this is where I go back to, I don't want to buy show by show in a CTV environment. I still want the audience. But, I also want to recognize where that spot is going. It's more of a verification than it's a plan, so to speak. David McBee: This is why you can be transparent and charge a fee for your consultations, because I think most advertisers would get that information and immediately jump to the conclusion that the targeting is wrong. That's just my opinion. But, you did make me think of something kind of funny. My favorite Jeep commercial of all time is about this young couple growing older and then buying new Jeeps as they get older, so that's so weird, that's like a rom-com Jeep commercial. Anyway, we're way over on time, so let me ask you my closing questions. Starting with, do you have a favorite podcast or a book that you feel has helped you become successful? Eric Nelson: I don't know if I have necessarily a favorite, and I've just started getting into a little bit more the podcasts. Neil Patel is somebody that I listen to quite often. There's a new podcast, I don't know if it's new, but it's new to me, the Marketing Architects. I think they're fascinating, and I love listening. Obviously Simpli.fi TV, I like to check out anytime there's something new. But, there's an old TED Talk, Simon Sinek. I think a lot of us know it, of The Power of Why. This is something, it's old, it's been out there forever. I know he's moved on to very different things. But, that was something in my career that really, it was probably one of the first big things that really started to twist my brain and go, think differently about things and think about why. That's where I get to some of these audience types of things, where understanding why that's effective or why that's there and how it can benefit us in the long way. Those are the things that I lean on. David McBee: You might be the 10th or 15th person to bring up Simon Sinek. I should really get a sponsorship deal going with him. Eric Nelson: You should. Yeah, we got to get him on here and kick in a little bit. David McBee: What's the best way for people to learn more about you or stay in touch? Eric Nelson: It's really, we do everything really pretty much through LinkedIn. You can find Fraction Media Group or myself or my partner, James Hacker, we're on LinkedIn. Fractionmediagroup.com will link back to our LinkedIn. Again, when you get a couple of media guys trying to build a website, we kind of went, "Yeah, let's not do that." David McBee: Well, thank you so much for being on the show today, Eric. Eric Nelson: No, I appreciate you having me involved and doing what you're doing, and excited to see more episodes. David McBee: Thanks. Thank you guys for watching. Simpli.fi TV is sponsored by Simpli.fi, helping you to maximize relevance and multiply results with our industry leading media buying and workflow solutions. For more information, visit Simply.fi. Thanks for joining us today. I'm David McBee. Be awesome, and we'll see you next time.
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