Permutive was founded by Joe Root and Tim Spratt in 2014 and is Y Combinator, Octopus Ventures and EQT backed. The company is headquartered in London, with a fast-growing office in New York, and aims to double its headcount to 80 by the close of 2019.
WNIP met with Permutive’s Joe Root in Farringdon to find out more – a timely meeting as the company had just picked up an award for Best Sell Side Innovation at The Drum’s Digital Advertising Awards the previous evening for its work with Immediate Media.
What business problem is your company addressing?
One of the biggest changes for publishers over the last 10 years is moving from a directly-sold advertising business to a programmatic advertising business. This change should have given publishers more control and power to generate higher revenues. However, it did the opposite and placed most of the control in the advertisers’ hands.
Advertisers now use their own data to make decisions on what ads to buy and are less loyal to publishers. Technology and algorithms are now making decisions and are being driven by efficiency rather than effectiveness. Over the past 5 years, this challenge has become an issue for every media outlet due to Facebook and Google.
Publishers however still have premium content and environment – over the past two years, we have seen many of them taking back control by understanding their audience better (using data) and turning this into value rather than a commodity. This is where we come in.
What is your core product?
Permutive is the first data platform designed exclusively for the challenges that publishers face. Built on edge computing, we don’t need to send data back-and-forth to cloud servers for processing. We process data where it is collected, on the user’s device. This delivers significant speed, scale and privacy benefits to publishers. The result is a sizeable increase in the quality and scale of data collected, so that publishers can drive more data-driven revenue.
A large proportion of publishers’ audiences come from Google and Facebook, and from browsers such as Safari and Firefox that block third-party cookies by default – we call this the hidden web. This means that today around half (48%) of publishers’ audiences are effectively hidden from the advertising ecosystem. There is no data behind these users at all.
Permutive’s technology does not rely on third-party cookies to work and therefore is able to provide 100% visibility of a publisher’s audience. This can result in a 3 – 9x increase in audience visibility for some publishers. By unlocking this audience a publisher will naturally have more impressions they are able to use for targeting. We have seen this result in a 4x increase in data-driven advertising revenue.
Can you give some examples of publishers successfully using your solution?
Publishers using Permutive include Condé Nast International, BuzzFeed, The Economist, Hubert Burda Media and Immediate Media.
Working with Permutive, Immediate Media has increased its targetable inventory by over 60%, enabling it to serve personalized advertising to over 80% of its entire audience. The move, which enables it to compete more effectively against the scale of media giants like Facebook and Google, has generated a month-on-month growth in data traded revenues of 135% (Q4 2018).
We are a SaaS business. Our customers will sign 2 to 3-year contracts to use Permutive’s technology.
What are other people doing in the space and why?
There are a number of other DMPs in the market. However, these are designed for marketers and rely on third party cookies. Permutive is the first and only data platform designed exclusively for the challenges that publishers face.
How you do view the future?
Today’s advertising technology isn’t working for publishers – and that’s a challenge not just for them but every advertiser today. Even society: in an era of so-called fake news, we’d all be a little poorer without the democratic checks and balances that premium publishers provide.
It’s time to change that and help publishers get the value they deserve out of the data they have and do more with it – be that through advertising or, increasingly, subscription models and ecommerce ventures.
We believe that ‘now’ is the best time for publishers to reassert their authority in the advertising ecosystem. The technology is already here to allow it, but the ecosystem has flaws. A focus on third-party data is skewing the system. The tools people have been using are designed with advertisers in mind – simply put, they are not fit for purpose. In such a system it is all but impossible for publishers to maximize the commercial potential of their data.
Permutive has been built from the ground up as a cookie-less solution dedicated to publishers, giving them full control over their first party data and putting the power back in their hands.