Ad Tech Analogies: Simple is the New Smart (Concert Ticket Analogy)

Next up in our ad tech analogies series: The Concert Ticket Analogy, which explains the difference between preferred deals, private marketplaces, and the open marketplace.

For the purposes of this analogy, let’s pretend I have tickets to a Rolling Stones concert and, it turns out, I’m not able to go and I need to figure out a way to sell my tickets.

The first person I ask before anyone else is my friend at work, and I ask if she wants to buy the tickets from me at their fixed rate value. I’m giving her the privilege of a first look or first right to refuse to buy, and I’m offering the tickets for the amount I paid. If she wants to buy them? Great, we’re done, and we just negotiated a preferred deal. If she doesn’t? I need to reach out to other people and find another way to monetize these tickets.

So, I send an email to the company’s all-employee distribution list – which functions like a private marketplace, because it’s a private environment of select people (or, in programmatic terms, select buyers and sellers). I ask who wants to buy the tickets. First-come, first-serve, and I’ll give them to the highest bidder. If someone offers to buy them? Great, sold. If not, then I try again to monetize through another avenue.

I could post the tickets on sites like StubHub, Craigslist, or eBay – which are open to all buyers. This is like an open marketplace, because it allows a larger pool of users to access it and it’s more likely to be sold this way.

Next week we’ll dive into The Black Shoe Analogy, which explains the benefit of buying from a DSP in real-time.

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