The classic agency model continues to shift and today’s news out of AOL is just the latest example. Recode is reporting a drastic reorganization and layoffs of ad sales staff.
Why do you care about this latest round of musical chairs at AOL? Because it clearly represents what a content-and-advertising focused company — in the same boat as rivals like Yahoo — must do as the advertising landscape changes quickly, moving from a business of premium display sales to “programmatic” advertising.
Simply put, rather than people, negotiations and insertion orders, programmatic is the use of machines to buy ads using big data. It is obviously more efficient, especially as the targeting technology improves.
You simply don’t need as many layers of sales staff in the new era of advertising. This creates more access to smaller advertisers and just as importantly eliminates needless overhead costs. Ad driven media companies need to stand on their own performance, not the sales skills of a bloated staff.
At Matchnode we welcome the change.